Fleet Bank and Deutsche Banc Alex. Brown snagged a $300 million credit replacing Wachovia Corp. for JDN Realty Corp. The banks are looking for 10-12 lenders to round out the syndicate. PNC Bank, which also participated in the previous line, has already committed $25 million. Commerzbank will act as documentation agent, and is holding $50 million, one banker said. SouthTrust Bank, Key Bank and First Tennessee National Bank will be participating in this deal as well, he added. Charles Talbert, director of investor relations at the REIT, confirmed the REIT was in the process of renewing its credit line but declined to elaborate or comment on the lead banks. Wachovia did not bid on the deal, officials at the bank said, declining to elaborate.
The credit is comprised of a $150 million term loan and a $150 million revolver. Pricing is based on a grid tied to the REIT's leverage levels, one banker said. Pricing starts at LIBOR plus 2 1/8% but can go as low as 13/4 % and as high as 21/4 %. Bank of Nova Scotia, which participated in the previous line, also will not be participating in this deal. Bank of Nova Scotia officials declined to comment.
Proceeds of the loan will be used to refinance the bank's $275 million credit facility, which matures in June. The previous line was originally priced at LIBOR plus 115 basis points. But pricing ballooned to LIBOR plus 21/2 % when news broke that two officials routed proceeds from a land sale to two other officials.