Apple Hospitality REIT has completed a series of refinancing transactions that increased its borrowing capacity and extended its debt maturities.
The hotel real estate investment trust increased its main unsecured credit facility from $1.2 billion to approximately $1.3 billion.
Apple Hospitality also expanded a separate term loan from $130 million to $160 million and extended its maturity to July 2033.
The main credit facility now includes a $275 million term loan maturing in July 2031, a $300 million term loan maturing in January 2032 and a $700 million revolving facility initially maturing in July 2030.
The revolving facility can be extended for up to one additional year if certain conditions are met.
An accordion feature allows the main facility to be increased to as much as $1.75 billion. The separate seven-year term loan can be expanded from $160 million to $300 million.
Pricing on the main facility ranges from the Secured Overnight Financing Rate plus 1.35% to 2.30%, depending on the company’s leverage and the applicable loan.
Pricing on the seven-year term loan ranges from SOFR plus 1.70% to 2.65%.
Apple Hospitality used the additional $30 million from the term loan to reduce its revolving balance and address secured debt maturities.
The company also updated pricing on two other unsecured facilities totaling $470 million.
Following the refinancing, Apple Hospitality has no significant debt maturities until 2029. The weighted average maturity of its consolidated debt has been extended to nearly five years, and the company has no outstanding revolver borrowings.
Apple Hospitality owns 216 hotels with approximately 29,500 rooms across 37 states and the District of Columbia.
Support: BofA Securities, Wells Fargo Securities, KeyBanc Capital Markets and U.S. Bank served as joint lead arrangers and bookrunners for the main facility. PNC Capital Markets and Truist Securities also served as lead arrangers. PNC Capital Markets and Huntington National Bank arranged the seven-year term loan.
KEY QUOTE:
“With their support, we improved pricing and more favorably laddered and extended our debt maturity schedule, providing the company with additional financial flexibility and liquidity to pursue strategic growth opportunities and capital allocation priorities in the coming years.”
Liz Perkins, Senior Vice President and CFO of Apple Hospitality REIT
