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Agree Realty (ADC) Issues Notes Worth $125M, Boosts Liquidity

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Agree Realty Corporation (ADC - Free Report) recently concluded the private placement of $125 million of senior unsecured notes to various institutional investors. These notes carry a fixed interest rate of 4.32% and will mature on Sep 26, 2030.

Agree Realty has planned to use the proceeds from this issuance to pay for its unsecured revolving credit facility and general corporate needs. Excluding the unsecured revolving credit facility, the company’s weighted-average debt maturity is now 8.1 years.

Agree Realty has obtained $475 million of long-term unsecured debt or common equity in the year so far. The amount includes proceeds from the above placement as well. This will also enable the company to fund its pipeline of net lease investment opportunities.

Notably, Agree Realty is engaged in the acquisition and development of properties for leasing to retail clients. The latest transaction will boost the company’s financial flexibility in order to invest in its solid pipeline of net lease properties.

Of late, the retail real estate industry has been witnessing a decline in demand for properties, owing to exponential growth in the e-retail industry. This has affected Agree Realty, as well as other retail real estate investment trusts (REIT), like Simon Property Group, Inc. (SPG - Free Report) , Kimco Realty Group (KIM - Free Report) and Taubman Centers, Inc. (TCO - Free Report) . The retail real estate landlords have been countering the lackluster market by overhauling their portfolios. This will help them create demand for their properties, which, in turn, will boost growth over the long run.

With a portfolio of 508 properties, which comprises 9.8 million square feet of gross leasable space, Agree Realty looks poised to grow, backed by its acquisition efforts amid choppy retail real estate environment. Notably, the company has invested $207.1 million in 63 retail net lease properties in first-half 2018.

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