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Parkway Life Real Estate Investment Trust (PLife REIT) has issued 5 billion yen (S$60 million) worth of 5.5-year senior unsecured fixed rate notes due 2023.
Issued by Parkway Life MTN Pte. Ltd., the notes were issued under its $500 million multicurrency debt issuance programme, with Barclays Bank PLC and DBS Bank Ltd as joint lead managers and joint book runners.
“This successful notes issue will allow PLife REIT to diversify its funding sources and enable us to achieve a further reduction in our overall interest costs. We are pleased to add that the Notes Issue received strong interest and was fully subscribed by Japanese institutional investors, reflecting a vote of confidence in PLife REIT’s investment strategy in Japan,” said Yong Yean Chau, the chief executive officer of the REIT’s manager.
Tapping on the capital market for the notes issue enable PLife REIT to eliminate near-term refinancing as well as interest rate risks.
Denominated in Japanese yen, the notes issue also serves as a natural hedge for the trust’s Japanese assets while mitigating any foreign exchange risk.
The proceeds of the notes issue will be on-lent to PLife REIT to pre-emptively refinance around 32 percent of its long-term loans due in 2019.
“The exercise will also lengthen the REIT’s debt maturity profile to avoid the “bunching” effect of loans expiring in a single year,” added the trust’s manager.
This article was edited by Keshia Faculin.
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