Klépierre raises €500m through bond issue

The 15-year notes carry a coupon of 1.625%.

The French real estate investment trust Klépierre has raised €500 million through a bond issue.

The firm, which specialises in shopping centre development and investment, issued a 15-year bond, priced at a 50 basis points margin above the swap rate, the tightest spread ever for a European REIT for a 15-year maturity or longer. It translates into a coupon of 1.625 percent.

The bond was 2.4 times oversubscribed, the company said. The notes were placed after launch with “high-quality, long-term” global investors, notably from Germany, which made up 41 percent of the allocated book. Demand from France accounted for 33 percent, followed by the UK with 18 percent.

BNP Paribas, Crédit Agricole, HSBC, ING, Mizuho International and NatWest Markets acted as active bookrunners for the new issue.

Klépierre has also launched a cash tender offer for four outstanding bonds:

– A €500 million bond issued by Klépierre, maturing in September 2019 and offering a 2.75 percent coupon;

– A €500 million bond issued by Corio, maturing in February 2021 and offering a 3.25 percent coupon;

– A €600 million bond issued by Klépierre, maturing in March 2021 and offering a 4.75 percent coupon;

– An €85 million bond issued by Corio, maturing in December 2022 and offering a 3.516 percent coupon.

The offer period for the tendered bonds is expected to end on 6 December. Natixis, NatWest Markets and Société Générale are acting as dealer managers in the tender offer.

Klépierre said the transactions support the firm’s financing strategy, which aims to reduce funding costs while extending the average maturity of its debt.