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sur Grand City Properties S.A., (isin : LU0775917882)

Grand City Properties Announces Successful Exchange and Tender Offer, Boosting Credit Metrics and FFO

Grand City Properties S.A. (GCP), a prominent real estate giant, declared the triumphant outcome of its voluntary exchange offer concerning two of the company's perpetual notes and the issuance of a new benchmark perpetual note. The strategic financial maneuver witnessed an impressive 82% of existing notes being tendered, amounting to €449 million, which are set to be exchanged for approximately €410 million in new perpetual notes. Additionally, the endeavor encompasses the buyback of €34 million worth of notes through the tender offer.

The company emphasized the positive implications of the exchange on its financial health, particularly spotlighting the bolstering of its credit metrics as per S&P’s methodology. The new perpetual notes are expected to retain a 50% equity content, aligning with S&P's credit rating framework, whilst maintaining a 100% equity status under IFRS and for bond covenants. This strategic move is poised to culminate in a reduction of coupon payments for perpetual notes, ultimately contributing to a FFO (Funds from Operations) accretive outcome.

In addition, the newly issued perpetual notes are noted for their nominal amount of €409.5 million with a 6.125% coupon, marking a notable financial restructure aimed at long-term stability and growth. Grand City Properties, renowned for its specialization in residential real estate and value-add opportunities across densely populated regions in Germany and London, continues to reinforce its financial framework while focusing on strategic property improvements and tenant management.

R. E.

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