 |
| Cindy Teo |
The new agreement has an aggregate principal amount of $550 million, comprising a $400 million term loan facility and a $150 million committed revolving credit facility.
Prime US REIT trades on the Singapore Exchange Securities Trading Limited ticker as: OXMU. KBS serves as the U.S.-based asset manager for the portfolio, which includes helping to negotiate the credit facility. Prime US REIT’s portfolio consists of extremely well-located Class A assets with highly desirable amenities.
Rahul Rana
“The completion of this
refinancing further strengthens our capital position, allowing us to make
significant capital improvements across our portfolio, ensuring our
buildings meet the highest standards of quality, sustainability, and tenant
satisfaction," says Rahul Rana, CEO and Co-Sponsor of Prime US
REIT.
"We are committed to
providing exceptional spaces for our tenants and ensuring continued value for
our investors. We are now better equipped to seize new opportunities and
reinforce our commitment to long-term success.”
The Prime US REIT
refinance highlights the strength of Class A office as tenants reimagine how
they use office space, shining a positive light on the sector, according to Marc
DeLuca, CEO and Eastern regional president of KBS.
“KBS assisted Prime US
REIT with the financing in 2019 in conjunction with the initial listing on the
Singapore Stock Exchange,” says DeLuca.
“This refinancing marks another strategic
move by Prime US REIT and demonstrates the ongoing appeal of premier office
assets. While Class B and C office properties may be struggling due to shifting
trends in office use, companies are continuing to gravitate toward well-located
Class A office buildings with state-of-the-art amenities in key U.S. markets –
the essence of the Prime US REIT portfolio.
"Employers are
utilizing this space to attract their teams to the office in an increasingly
competitive business environment.”
As the U.S.-based asset
manager for the portfolio, KBS’ active asset management strategies are focused
on leasing. Leasing volume in the Prime US REIT portfolio more than doubled
year-over-year in the first half of 2024, increasing from 131.2k sf to 268.6k
sf.
Marc DeLuca
The increase in leases
executed in the first half of 2024 highlights improving tenant confidence in
executing leases. The weighted average lease was 4.2 years as of June 2024.
While the recovery of the office sector remains bifurcated across markets, new
leasing demand is encouraging.
One Washingtonian Center in Gaithersburg, MD
is a 14-story office building with a lakefront view,
adjacent to Rio Shopping Center.
The portfolio secured renewals and new signings at several assets including Reston Square, Promenade, 171 17th Street, Tower 909, 101 South Hanley, and One Washingtonian Center.
“Prime US REIT is in a
strong financial position, bolstered by this refinancing,” says Cindy Teo,
CFO of Prime US REIT.
“The additional liquidity
allows us to invest in critical capital improvements across our properties,
enhancing the quality and longevity of our assets. By focusing these
resources on upgrades and modernizations, we are positioning our portfolio for
continued growth and ensuring sustained value for both our tenants and
investors.”
KBS is also assisting
Prime US REIT in an asset enhancement initiative at One Washingtonian Center
in Gaithersburg, Maryland. The iconic 14-story office building with a lakefront
view, adjacent to Rio Shopping Center, offers a diverse and eclectic mix of
restaurants, shops, cinema and entertainment options.
The repositioning is
slated for completion in the fourth quarter of 2024 and will feature a fully
renovated lobby entrance, renewed tenant lounges, conference center, new
full-service gym, and Grab & Go Café with banquette seating and direct
water views.
Despite the high cost of
debt creating challenges in the capital markets, and many lenders pulling back
on office financing, KBS has worked successfully with its lending relationships
to refinance multiple loans for Class A office properties in 2023 and 2024.
Robert Durand
KBS’ ability to work with
all stakeholders to reach mutually acceptable terms and complete complex
transactions in a challenging capital markets environment was instrumental in
the original Prime US REIT bank facility loan and in the successful refinancing
of this facility on Prime US REIT’s behalf, according to Robert Durand,
executive vice president of finance at KBS.
“Our firm worked with
Prime US REIT to establish the original credit facility as well as its
refinancing, demonstrating our experience and the depth of our long-lasting
lending relationships,” says Durand.
“Our in-house financing
team has deep expertise in commercial real estate and the capital markets.
After 32 years in the industry, we recognize how economic and real estate
cycles run, and we know what financial institutions require in a qualified
borrower and operator.
"Our long-standing
relationships with lenders and a solid track record of success in office
properties and operating integrity helped bring this transaction across the
finish line.”
CONTACTS:
vivian
Liu
vliu@thesmartagency.com
Ginny Walker
KBS Senior Public
Relations Director
949-417-6535
Lexi Astfalk or Sophia
Reznicek
The Smart Agency
949-438-6262
Prime US REIT Investor
Relations
T: (65) 6951 8095
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