Kennedy Wilson Europe issues further €150m of bonds

Kennedy Wilson Europe Real Estate (KWE), Kennedy Wilson’s listed investment vehicle, has issued a further €150 million of 3.25 percent bonds through a second draw-down on its Euro Medium Term Note (EMTN) programme.

Kennedy Wilson Europe Real Estate (KWE), Kennedy Wilson’s listed investment vehicle, has issued a further €150 million of 3.25 percent bonds through a second draw-down on its Euro Medium Term Note (EMTN) programme.

The notes will be issued at a yield of 3.039 percent and will mature on 12 November 2025. The notes are rated BBB (outlook stable) by Standard & Poor’s.

The firm said that the proceeds from the issue will be used to refinance existing secured debt and for general corporate purposes.

KWE issued an initial €400 million of senior unsecured 3.25 percent fixed coupon notes due 2025 under the programme in November 2015. The firm upsized last November’s draw-down by €100 million. The new notes will be consolidated and form a single series with the initial notes.

Mary Ricks
Mary Ricks

“This successful bond tap delivers on our intention to move to a more flexible debt structure and increases the notes to benchmark size, improving liquidity for bondholders,” said Mary Ricks, president and CEO of KWE.

“Our mix of fixed rate debt improves to 59 percent, fixed rate or hedged debt improves to 87 percent, and our overall debt term to maturity extends to 6.4 years, whilst maintaining an attractive cost of debt at 2.85 percent, which remains accretive to our running yields,” Ricks added.

The issue and settlement date for the notes is expected to be 19 April 2016. The notes will be listed on the London Stock Exchange and will rank pari passu with KWE’s existing £300 million senior unsecured bonds due 30 June 2022, which were launched last June.

KWE was established in 2014. It invests in direct real estate and real estate loans in Europe. Its existing portfolio stands at more than £2.5 billion and is primarily invested across office and retail in the UK and Ireland.

Bank of America Merrill Lynch, JP Morgan Cazenove and Morgan Stanley acted as joint book-runners.

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