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Charter Hall WALE Limited as responsible entity of the Charter Hall Long WALE REIT (ASX:CLW) (the REIT), announces that the Charter Hall Exchange Investment Trust (CHEIT) (rated A3 (stable) by Moody’s), in which CLW owns a 50% interest, has today confirmed A$300 million 10 year Medium Term Notes (Notes) which will mature in September 20301.
CHEIT owns a 49% interest in The Exchange Trust, which owns a portfolio of 36 telecommunication exchange properties (Telco Exchange Portfolio). The Telco Exchange Portfolio is 100% leased to Telstra Corporation Limited on NNN lease terms with a WALE of 20.1 years as at 30 June 2020.
The Notes will be issued with a fixed coupon of 2.32%, representing a spread of 1.55% over the relevant swap rate. The issuance is due to settle on 25 September 2020, subject to customary closing conditions. The proceeds from the issuance are to be utilised to retire an equivalent amount of CHEIT’s existing senior debt facility. Commonwealth Bank of Australia was the sole lead manager for the transaction.
The issue of the Notes and the retirement of an equivalent amount of CHEIT’s existing senior debt facility has no impact on the FY21 Operating EPS guidance provided to the market at CLW’s results on 7 August 2020.
CLW Fund Manager, Avi Anger commented,
“The issuance of these 10 year Notes increases CLW’s weighted average look through debt maturity from 3.7 years to 4.2 years at the time of settlement. The Notes also further diversifies debt sourcing for CLW and capitalises on the underlying strength, tenant quality and credit profile of the Telco Exchange Portfolio.”
Announcement Authorised by the Board
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1 Represents CLW look through debt of $150 million.