Back to top

Image: Bigstock

Life Storage Taps Debt Market With Senior Notes Offering

Read MoreHide Full Article

Life Storage, Inc. (LSI - Free Report) announced the pricing of a public offering of $400 million aggregate principal amount of 2.200% senior unsecured notes through its operating partnership, Life Storage LP.

The notes will mature on Oct 15, 2030, and will be issued at 99.524% of par value. The offering is anticipated to close on Sep 23, 2020, subject to the satisfaction of customary closing norms.

The debt obligations will pay a coupon of 2.200% semi-annually on Apr 15 and Oct 15 of each year, starting from 2021.

The company intends to use the proceeds from the offering to address near-term debt maturities and future growth endeavors. Specifically, it is likely to allocate net proceeds to repay its $100-million unsecured term note due Aug 5, 2021, in full, along with accrued interest and prepayment fees related thereto.

Moreover, the company will pay down any balance outstanding under its unsecured line of credit. Any remaining proceeds will be used for future buyouts of self-storage properties and general corporate needs.

Notably, the company’s efforts to strengthen its liquidity in these testing times and tap the debt market amid a low interest-rate environment are strategic fits. Additionally, the self-storage industry continues to benefit from favorable demographic changes. Specifically, migration and downsizing trends, and an increase in the number of people renting homes have escalated the needs of consumers to rent space at a storage facility to park their possessions. Hence, the company’s focus to benefit from these factors on the back of acquisitions is a strategic fit.

However, the note offering increases the company’s long-term financial obligation.

Shares of this Zacks Rank #3 (Hold) company have rallied 14.7% over the past three months against the industry’s 4% decline.



Stocks to Consider

Duke Realty Corporation’s (DRE - Free Report) Zacks Consensus Estimate for 2020 funds from operations (FFO) per share has been revised 3.5% upward to $1.49 over the past month. The company currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Alpine Income Property Trust, Inc.’s (PINE - Free Report) FFO per share estimates for 2020 have been revised 14.4% upward to $1.19 over the past 30 days. It currently carries a Zacks Rank of 2.

Sabra Healthcare REIT, Inc.’s (SBRA - Free Report) FFO per share estimates for the ongoing year have been revised marginally upward to $1.72 over the past week. The company currently carries a Zacks Rank of 2.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

These Stocks Are Poised to Soar Past the Pandemic

The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.

Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.

See the 5 high-tech stocks now>>