ARLINGTON, Va., Feb. 5 /PRNewswire/ -- Charles E. Smith Residential
Realty, Inc., (NYSE: SRW), one of the country's leading apartment REIT's,
announced two new financing transactions providing additional capital sources
for the Company's continuing growth. The Company raised $50 million of
perpetual preferred stock from an investment fund managed by CGA Investment
Management, Inc. In a separate transaction, the Company has negotiated an
increase in its line of credit from $100 to $250 million along with conversion
of the line from a secured to an unsecured facility.
"These actions greatly increase our competitiveness in acquiring and
developing quality assets," said Denny Minami, the company's Chief Financial
Officer. "The perpetual preferred stock strengthens our balance sheet and
provides an attractive new source of equity capital. The large increase in
our credit facility, now on an unsecured basis, shows the strong confidence of
our lenders in the Company's growth strategy."
The $50 million of perpetual preferred stock will pay a fixed dividend
rate of 7.91% per annum, and at such time as the securities obtain an
investment grade rating the dividend rate will be reduced by 25 bp.
Prudential Securities, Incorporated represented Charles E. Smith in the
private placement of the perpetual preferred stock. Net proceeds to the
Company are estimated to be approximately $48.9 million, which will be used to
retire existing debt.
The Company's $250 million bank credit facility, expanded from its current
$100 million, is expected to be completed this month and will have a three-
year term with a two-year extension provision. The interest rate will range
from 75 to 110 bp over LIBOR initially, in accordance with a formula based on
the Company's leverage ratio, and will be adjusted to 60 to 90 bp over LIBOR
upon receipt of an investment grade rating. PNC Bank will act as lead agent
for the bank group providing the credit, which will also include NationsBank
and First Bank-Minneapolis as co-leads.
Charles E. Smith Residential Realty, Inc. is a self-managed real estate
investment trust listed on the New York Stock Exchange (SRW). The Company and
its subsidiaries and affiliates own, acquire, develop, and manage multi-family
residential properties; and also provide a full range of real estate services
to other property owners. The Company owns a portfolio of over 18,500
apartment units, has over 2,000 units under construction, and manages an
additional 4,000+ units for other owners. The total market capitalization of
the Company -- Charles E. Smith Residential Realty, including its Operating
Partnership -- is approximately $1.7 billion. Investor information including
press releases about Charles E. Smith Residential Realty is available on the
Company's Web site at: http://www.smithreit.com.
SOURCE Charles E. Smith Residential Realty, Inc.
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Related links:
http://www.smithreit.com
CONTACT:
Investors: Denny Minami, 703-769-1123; Media:
John Kurtz, 703-769-1153, both of Charles E. Smith Residential
Realty
CNOC: http://www.prnewswire.com or fax, 800-758-5804, ext.
101271
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