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Essex Property Announces Pricing of Senior Unsecured Notes

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Essex Property Trust Inc. (ESS - Free Report) announced that its operating partnership, Essex Portfolio, L.P. has priced $450 million senior unsecured notes. The pricing of notes will add to the liquidity strength of this San Mateo, CA-based residential real estate investment trust (“REIT”).

The rate of interest decided on the unsecured notes is 3.375% per annum. It is payable on a semi-annual basis in April and October. The first interest payment on these senior notes, slated to mature on Apr 15, 2016, is due on Oct 15, 2016. Subject to the fulfillment of certain customary closing conditions, the notes offering is likely to close on Apr 11, 2016. The company intends to utilize the net proceeds generated from this offering for debt repayment under an unsecured credit facility, meeting working capital requirements and for other general corporate purposes.

Essex Property is engaged in the acquisition, development, redevelopment and management of multifamily residential properties in supply-constrained markets. The company reported fourth-quarter 2015 earnings on Feb 04, 2016. It reported fourth-quarter 2015 core funds from operations (“FFO”) of $2.63 per share, beating the Zacks Consensus Estimate of $2.55. Core FFO per share also increased 17.4% from the year-ago quarter figure of $2.24. Results were driven by solid growth in net operating income (“NOI”).

Essex Property currently has a Zacks Rank #2 (Buy). Investors interested in the REIT industry may consider stocks such as Mid-America Apartment Communities Inc. (MAA - Free Report) , Post Properties Inc. and Select Income REIT (SIR - Free Report) . Each of these stocks holds the same Zacks Rank as Essex Property.

Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

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