Parkway Life REIT gets 0.51% pricing for $41.3m debt

It will be used to repurchase notes due 2022 without penalty.

Parkway Life REIT has termed out its maturing debts with the pricing of $41.3m (¥3.3b) at 0.51% for six-year senior unsecured fixed rate notes.

The notes are due in 2027 and under Parkway Life REIT's $500m multicurrency debt issuance programme.

According to local media, the notes issue is slated to be completed on 29 March.

Its proceeds will be utilised for the repurchasing of the 29 March 2016 issuance of $41.3m (¥3.3b) at 0.58% for senior unsecured notes. This is due by 2022, set at the price of 100% of their principal amount, excluding the penalty.

CEO Yong Yean Chau said it is necessary for Parkway Life REIT to mitigate any potential refinancing risk by pre-emptively terming out maturing debts.

"The successful pricing of new notes for a further six years at an attractive rate, to repurchase the notes due 2022 at par and without penalty, validates the continual strong support of the growth strategy in Japan,” she said.

The proposed notes issue is aimed to mitigate foreign risk by being denominated in yen and will likewise serve as a natural hedge for its Japanese assets.

They appointed DBS Bank as its sole lead manager and bookrunner for the new issuance. The bank will also be the buyback agent for the repurchase of the maturing debt.

(SG$1 = ¥81.09)