News Column

RAIT Financial Trust Completes a $196 Million Non-Recourse, Floating-Rate CMBS Transaction

May 16, 2014



By a News Reporter-Staff News Editor at Real Estate Weekly News -- RAIT Financial Trust (NYSE: RAS) ("RAIT") announced the completion of a non-recourse, floating-rate CMBS transaction collateralized by floating rate commercial real estate first lien mortgage loans and participations originated by RAIT totaling approximately $196.0 million. The transaction involved the issuance and sale by a RAIT subsidiary of investment grade notes totaling approximately $155.9 million with a weighted average cost of LIBOR plus 1.79%, which provide an advance rate to the RAIT subsidiary of approximately 79.5%. RAIT affiliates retained all of the issuer's un-rated subordinated interests totaling approximately $40.2 million. RAIT entered into the transaction to obtain non-recourse, matched-term financing for the loans and participations serving as collateral. RAIT expects to earn a double-digit yield on its retained interest in the affiliated issuing entity, inclusive of fees less transaction expenses, assuming all of the underlying loans and participations are repaid at their stated maturity and not prepaid, in default or sold. Credit Suisse Securities (USA) LLC and UBS Securities LLC acted as co-lead and joint book-running managers. Citigroup Global Markets Inc. acted as co-manager.

The bonds were offered inside the United States to (1) qualified institutional buyers within the meaning of Rule 144A under the Securities Act of 1933, as amended (the "Securities Act") and (2) to other institutional investors that are accredited investors within the meaning of rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act, and outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act. The bonds have not been registered under the Securities Act or applicable state or foreign securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws. This announcement shall not constitute an offer to sell or the solicitation of an offer to buy the bonds. About RAIT Financial Trust RAIT Financial Trust is an internally-managed real estate investment trust that provides debt financing options to owners of commercial real estate and invests directly into commercial real estate properties located throughout the United States. In addition, RAIT is an asset and property manager of real estate-related assets. For more information, please visit www.raitft.com or call Investor Relations at 215.243.9000.

Keywords for this news article include: Real Estate, Legal Issues, RAIT Financial Trust.

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Source: Real Estate Weekly News


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