Hersha Hospitality Trust refinanced its $300 million senior unsecured term loan and entered into new swap contracts to fix the interest rates on the remaining $400.9 million of senior unsecured term loans.
The hotel real estate investment trust fixed the interest rate on the $300 million term loan at 3.31% with a five-year maturity, from the London interbank offered rate plus 185 basis points. It also fixed the interest rate on certain term loans due 2021 and 2022 at 3.53% and 4.02%, respectively.
Following the transactions, 90% of Hersha's outstanding debt is either fixed or hedged through various derivative instruments. The REIT said it has a weighted average interest rate of 3.9% across all borrowings with a weighted average life-to-maturity of about four years.
Citibank NA and Wells Fargo Securities LLC were the joint lead arrangers and joint book-running managers for the term loan refinancing, with Citibank serving as administrative agent and Wells Fargo Bank NA as syndication agent. Bank of America NA, BMO Harris Bank NA, BBVA USA, Fifth Third Bank, Goldman Sachs Bank USA, Manufacturers and Trading Trust Co., Raymond James Bank NA and TD Bank NA were co-documentation agents.
First Commercial Bank Ltd. and The Huntington National Bank were senior managing agents. Wilmington Savings Fund Society, FSB and The Provident Bank were among the other participating lenders.
