UDR Inc. (UDR), a leading multifamily real estate investment trust (REIT), has recently repaid its term loan maturing in 2010 by utilizing proceeds from a new term loan and by drawing down its unsecured bank credit facility.
The repayment of the $240 million term loan was made possible by a new term loan provided by a consortium of six banks, and by utilizing capacity of its $600 million unsecured bank credit facility. The new term loan carries a floating rate of 350 basis points over LIBOR, and is scheduled to mature in July 2012.
UDR had earlier repaid all of its 2010 secured debt by utilizing a $200 million 10-year secured credit facility from Fannie Mae (FNM) at a blended interest rate of 5.28%. In addition, the multifamily apartment company has $3.2 billion of unencumbered assets, which provide additional flexibility to address further capital requirements.
UDR is among the best-positioned multifamily apartment REITs in the U.S., with the majority of its portfolio located in California, Florida and on the Atlantic Coast. These are areas where housing costs have soared in the past few years, and despite the drop in home values, the rent vs. own spread remains high.
For over 37 years, UDR has delivered long-term value to shareholders by increasing its presence in markets where favorable job conditions, low housing affordability and favorable demand/supply ratio for multifamily housing prevail.
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