WPC
W P Carey INC
NYSE
8-K: W. P. Carey Inc. Issues $400 Million in Senior Notes Due 2034
Sentiment:
Debt Issuance Announcement
28 June 2024 4:15 PM
W. P. Carey Inc. has successfully completed a public offering of $400 million in 5.375% Senior Notes due in 2034, with the proceeds intended for general corporate purposes.
Capital raise
W. P. Carey Inc. has raised $400 million through the issuance of 5.375% Senior Notes due 2034.
The proceeds from this offering will be used for general corporate purposes, including potential investments and debt repayment.
Summary
- W. P. Carey Inc. has issued $400 million in Senior Notes with a 5.375% interest rate, maturing in 2034.
- The offering was completed on June 28, 2024, and the notes were issued under an existing shelf registration statement.
- The company plans to use the net proceeds for general corporate purposes, including potential investments and debt repayment.
- Interest on the notes will be paid semi-annually on June 30 and December 30, starting December 30, 2024.
- The notes are unsecured and rank equally with the company's other unsecured debt.
- W. P. Carey has the option to redeem the notes at a make-whole price before March 30, 2034, or at 100% of the principal amount plus accrued interest after that date.
- The indenture includes covenants that require the company to maintain a specific ratio of unencumbered assets to unsecured debt and limits secured and unsecured debt incurrence.
Sentiment
Score: 7
Explanation: The sentiment is moderately positive as the company has successfully raised capital, but it also increases their debt load. The terms are standard for this type of transaction.
Positives
- The successful issuance of $400 million in senior notes provides W. P. Carey with additional capital.
- The funds can be used for general corporate purposes, including investments and debt repayment, offering flexibility.
- The notes have a fixed interest rate of 5.375%, providing predictable interest expenses.
- The notes are unsecured, which may be attractive to some investors.
- The company has the option to redeem the notes, providing flexibility in managing its debt.
Negatives
- The company is taking on additional debt, which increases its financial leverage.
- The indenture includes covenants that could restrict the company's financial flexibility.
- The company will incur interest expenses of 5.375% per annum on the $400 million in notes.
Risks
- The company's ability to meet its debt obligations depends on its future financial performance.
- The covenants in the indenture could limit the company's ability to take on additional debt or make certain investments.
- Changes in interest rates could impact the company's cost of borrowing in the future.
- The company's credit rating could be affected by the issuance of new debt.
Future Outlook
The company intends to use the net proceeds from this offering for general corporate purposes, including to fund potential future investments and to repay certain indebtedness.
Industry Context
This debt issuance is a common practice for REITs like W. P. Carey to raise capital for acquisitions, development, and general operations. The interest rate and terms are typical for senior unsecured notes in the current market.
Comparison to Industry Standards
- Other REITs such as Realty Income (O) and Simon Property Group (SPG) also frequently issue debt to fund their operations and growth.
- The 5.375% interest rate is within the typical range for investment-grade REIT debt issuances, although specific rates vary based on market conditions and the issuer's credit rating.
- The maturity date of 2034 is a common term for senior notes, providing a balance between long-term funding and investor preferences.
- The make-whole redemption provision is a standard feature in corporate debt issuances, allowing the company to redeem the notes early while compensating investors for lost interest.
Stakeholder Impact
- Shareholders may see a potential increase in investment activity and growth due to the raised capital.
- Creditors will have a new debt instrument to consider in their analysis of the company.
- Employees may benefit from the company's increased financial flexibility and potential for growth.
Next Steps
- The company will use the proceeds for general corporate purposes, including potential investments and debt repayment.
- Interest payments will commence on December 30, 2024.
- The company will need to comply with the covenants outlined in the indenture.
Key Dates
- 2014-03-14: Date of the Base Indenture between W. P. Carey Inc. and U.S. Bank Trust Company, National Association.
- 2022-05-02: Date the company's automatic shelf registration statement on Form S-3 was filed with the Securities and Exchange Commission.
- 2024-06-18: Date of the final prospectus supplement relating to the Senior Notes.
- 2024-06-28: Date of the consummation of the public offering and the Tenth Supplemental Indenture.
- 2024-12-30: First interest payment date for the Senior Notes.
- 2034-03-30: Par Call Date, three months prior to the maturity date, after which the notes can be redeemed at 100% of principal.
- 2034-06-30: Maturity date of the Senior Notes.
Keywords
Senior Notes, Debt Financing, Public Offering, Corporate Debt, Indenture, Unsecured Debt, W. P. Carey, Real Estate Investment Trust, REIT
WPC
W P Carey INC
NYSE
Sector: Real Estate
Filings with Classifications
Capital raise
1 May 2025 5:22 PM
Capital Raising Announcement
- W. P. Carey Inc. has entered into an Equity Sales Agreement to offer and sell shares of its common stock, with an aggregate offering price of up to $1,250,000,000.
- The shares may be offered and sold from time to time through various agents.
- W. P. Carey may also sell shares to an agent as principal for its own account.
Worse than expected
30 April 2025 4:08 PM
Quarterly Report
- Net income attributable to W. P. Carey decreased due to higher losses from foreign debt remeasurement and increased allowance for credit losses.
Better than expected
1 April 2025 5:10 PM
Credit Agreement Amendment
- The amendment extends the maturity of a significant €500 million term loan by three years, improving the company's debt maturity profile.
- It introduces the potential for lower borrowing costs through a new pricing tier linked to higher credit ratings.
- The removal of specific spread adjustments on USD SOFR and CAD CORRA borrowings offers potential interest savings.
Worse than expected
12 February 2025 4:27 PM
Annual Results
- Total revenues decreased in 2024 as compared to 2023, primarily due to lower lease revenues and lower operating property revenues.
- Net income attributable to W. P. Carey decreased in 2024 as compared to 2023, primarily due to lower gain on sale of real estate, non-cash unrealized losses recognized on investment in shares of Lineage, and the impact of the Spin-Off and the Office Sale Program.
- AFFO decreased in 2024 as compared to 2023, primarily due to the impact of the Spin-Off and Office Sale Program.
Capital raise
12 February 2025 4:27 PM
Annual Results
- The company may access the capital markets through additional debt (denominated in both U.S. dollars and euros) and equity offerings, as well as term loans and other bank debt.
- The company may use existing cash resources, available capacity under our Senior Unsecured Credit Facility, proceeds from term loans or other bank debt, proceeds from dispositions of properties (including the Office Sale Program), and the issuance of additional debt or equity securities, such as issuances of common stock through our ATM Program, in order to meet our short-term and long-term liquidity needs.
Worse than expected
11 February 2025 4:10 PM
Earnings Release
- Net income attributable to W. P. Carey decreased by 67.4% in the fourth quarter compared to the same period in 2023.
- Full year AFFO per diluted share decreased by 9.3% from $5.18 in 2023 to $4.70 in 2024.
- Dividends declared during 2024 decreased by 14.2% compared to 2023.
- Revenues, including reimbursable costs, for the 2024 full year totaled $1.58 billion, down 9.2% from $1.74 billion for the 2023 full year.
Capital raise
13 November 2024 4:28 PM
Debt Offering Announcement
- W. P. Carey Inc. is raising $600 million through the issuance of 3.700% Senior Notes due in 2034.
- The offering is being underwritten by Barclays Bank PLC, BNP PARIBAS, J.P. Morgan Securities plc, and Bank of Montreal, London Branch.
Worse than expected
30 October 2024 4:06 PM
Quarterly Report
- The company's revenue, net income, and AFFO all decreased compared to the same period last year, indicating worse than expected results.
Worse than expected
29 October 2024 4:10 PM
Quarterly Report
- The company's net income and AFFO per share decreased compared to the same quarter last year, indicating worse results.
Worse than expected
15 October 2024 6:10 AM
Current Report
- The bankruptcy filing of a major tenant is generally considered a negative event that could impact future revenue.
Worse than expected
31 July 2024 4:06 PM
Quarterly Report
- Total revenues decreased due to lower lease revenues and operating property revenue.
- Net income attributable to W. P. Carey decreased due to the impact of the spin-off, asset sales, and impairment charges.
- AFFO decreased due to the impact of the spin-off, asset sales, lease restructurings and property vacancies.
Worse than expected
30 July 2024 4:06 PM
Quarterly Report
- The company's AFFO per diluted share decreased by 14.0% compared to the same quarter last year.
- The company lowered its full-year AFFO guidance by two cents per diluted share.
- Revenues decreased by 13.9% compared to the same quarter last year.
Capital raise
28 June 2024 4:15 PM
Debt Issuance Announcement
- W. P. Carey Inc. has raised $400 million through the issuance of 5.375% Senior Notes due 2034.
- The proceeds from this offering will be used for general corporate purposes, including potential investments and debt repayment.
Capital raise
20 June 2024 4:32 PM
Debt Offering Announcement
- The document details a $400 million offering of 5.375% Senior Notes due 2034.
- The company intends to use the net proceeds for general corporate purposes, including funding potential future investments and repaying indebtedness.
Capital raise
16 May 2024 4:10 PM
Debt Offering Announcement
- W. P. Carey Inc. has raised €650 million through the issuance of 4.250% Senior Notes due 2032.
- The offering was made pursuant to the company's automatic shelf registration statement and a final prospectus supplement.
Capital raise
8 May 2024 5:25 PM
Debt Offering Announcement
- W. P. Carey Inc. is raising $650 million through the issuance of senior notes.
- The notes are being offered to the public through an underwritten offering.
- The proceeds will be used for general corporate purposes and to repay existing debt.
Capital raise
1 May 2024 4:09 PM
Quarterly Report
- The company may use the at-the-market program (ATM Program) to issue additional equity securities.
- The company may also access the capital markets through additional debt offerings.
Worse than expected
1 May 2024 4:09 PM
Quarterly Report
- The company's revenue and net income decreased year-over-year, indicating worse performance compared to the previous year.
- AFFO also decreased, which is a key metric for REIT performance, suggesting a decline in operational profitability.
Worse than expected
30 April 2024 4:04 PM
Quarterly Report
- Net income and AFFO per share were down compared to the same period last year, indicating worse results.
Capital raise
9 February 2024 4:56 PM
Annual Results
- The company may access the capital markets through additional debt and equity offerings, as well as term loans and other bank debt.
- The company may issue common stock through its ATM Program.
Worse than expected
9 February 2024 4:56 PM
Annual Results
- The company's net income from Investment Management decreased due to the cessation of fees from CPA:18 Global.
- The company's fourth quarter dividend of $0.860 per share reflects a lower payout ratio.
Worse than expected
9 February 2024 7:39 AM
Quarterly Report
- The company's AFFO per diluted share for the fourth quarter and full year 2023 decreased compared to the previous year.
- The company's 2024 AFFO guidance is lower than the 2023 full year AFFO.
- Net income attributable to W. P. Carey decreased by 31.1% in the fourth quarter of 2023 compared to the same period in 2022.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.