UPDATE–as noted by nhcoast Moodys posted a Baa3 (low investment grade) on this issue last night–I have updated the chart below.
Net lease REIT Agree Realty (ADC) has priced their previously announced preferred issue.
The issue prices with a coupon of 4.25% for 7 million shares.
As typical for a REIT preferred the issue is cumulative and non qualified and optionally redeemable in about 5 years.
This is a monthly payor which investors tend to like–although admittedly the monthly dividend is meager.
The issue will trade immediately under OTC ticker ADCDV (look for the ticker to change in a day or two.
The pricing term sheet can be read here.
ADCDV on the OTC on 09/09/2021 at 15:41:18 $25.18
HeHeHe…what are those buyers thinking…
Like Rob in Vegas said…
“…getting the same competitive rates on a new preferred as PSA obtains is a bit ridiculous.
Pass on this one (for now). Will jump all over it if and when it trades well below $25.”
Cheers
KJN
From Moody’s:
New York, September 08, 2021 — Moody’s Investors Service (“Moody’s”) assigned a (P)Baa3 to Agree Realty Corporation’s preferred stock shelf and Baa3 to its new offering of $175 million Series A cumulative perpetual preferred stock. The outlook is positive. The REIT intends to use net proceeds from the offering for general corporate purposes, including to fund acquisitions and its development activities. In the same rating action, Moody’s affirmed the Baa2 senior unsecured rating for Agree Limited Partnership, the parent company’s operating subsidiary (collectively “Agree Realty” or “ADC”). The outlook remains positive, incorporating our expectation that ADC will maintain discipline over its leverage and liquidity profile, while continuing its accretive growth plans on a leverage-neutral basis.
Thanks nhcoast–guess I looked too soon before they posted this. Have changed.
Happy to be of service. Thanks again for all your efforts.
This has to be the lowest interest rate ever received on a straight preferred from a shopping center and/or net lease REIT.
ADC has a quality portfolio and good balance sheet, but to be getting the same competitive rates on a new preferred as PSA obtains is a bit ridiculous.
Pass on this one (for now). Will jump all over it if and when it trades well below $25.