Developers Diversified Realty Corp. (DDR) announced Friday the successful closing of the securitization of a $400 million, five-year loan to DDR that was originated by an affiliate of Goldman, Sachs & Co. on Oct. 8.
The blended interest rate on the loan that DDR pays is 4.225%. The AAA-rated portion of the certificates in the securitization constituted eligible collateral under the New York Fed's Term Asset-Backed Securities Loan Facility.
The mortgage loan is secured by a pool of 28 assets. Proceeds from the initial loan were used primarily to repay secured debt with near-term maturities and reduce balances on the company's revolving credit facilities.
DDR has repaid over $270 million of mortgage debt with a weighted average duration of 1.2 years and an interest rate of approximately 6.2%. Additionally, since the end of the third quarter, the company has used retained cashflow and revolver availability to retire approximately $119 million of unsecured notes, with a weighted average duration of 1.6 years and a yield to maturity of approximately 6.6%.
‘We are very pleased to complete this transaction, which highlights the availability of attractive financing for quality assets with strong sponsorship," says David Oakes, DDR's chief investment officer. "This also reaffirms our continued strategy to access long-term capital to retire short-term debt.’