Highwoods Properties, Inc. (HIW) recently announced that it has signed an agreement for a new seven-year unsecured term loan for up to $200 million. The term loan is expected to mature in the first quarter of 2019.
The company expects to use the proceeds from the term loan to reduce the outstanding balance on the company’s $475 million unsecured revolving credit facility and for other general corporate purposes.
Through the new term loan, Highwoods intends to improve and extend its debt maturities, which in turn will enable it to seize potential acquisition opportunities and enhance long-term value for its shareholders.
At quarter end, Highwoods had $11.1 million in cash and cash equivalents.Highwoods reported FFO (fund from operations) of $42.7 million or 56 cents per share in the third quarter of 2011 compared with $43.2 million or 57 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Highwoods is one of the largest owners and operators of suburban office, industrial and retail properties in the Southeastern and Midwestern U.S., providing a complete line of real estate services to its customers and third parties through a fully-integrated organization.
Highwoods currently retains a Zacks #2 Rank, which translates into a short-term Buy rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Cousins Properties Inc (CUZ) has a Zacks #3 Rank, implying a Hold rating over the short term.
