NEW YORK--(BUSINESS WIRE)--
Empire State Realty Trust, Inc. (NYSE:ESRT) (the “Company”) today
announced that its operating partnership Empire State Realty OP, L.P.
(the “Operating Partnership”) has priced a private offering of $250
million aggregate principal amount of the Operating Partnership’s 2.625%
Exchangeable Senior Notes due 2019, which will be sold only to qualified
institutional buyers in accordance with Rule 144A under the Securities
Act of 1933, as amended (the “Securities Act”).
The notes will be senior unsecured obligations of the Operating
Partnership. The Operating Partnership also granted the initial
purchaser a 30-day option to purchase up to an additional $37.5 million
aggregate principal amount of the notes. The closing of the sale of the
notes is expected to occur on August 12, 2014, subject to the
satisfaction of customary closing conditions.
The notes will pay interest semi-annually at a rate of 2.625% per annum
and will mature on August 15, 2019, unless redeemed, repurchased or
exchanged in accordance with their terms prior to such date. The notes
will have an initial exchange rate, subject to adjustment, of 51.4059
shares of the Company’s Class A common stock per $1,000 principal amount
of the notes, representing an exchange price of approximately $19.45 per
share of the Company’s Class A common stock and an exchange premium of
approximately 22.5% based on the last reported sale price of $15.88 per
share of the Company’s Class A common stock on August 6, 2014.
Prior to May 15, 2019, the notes will be exchangeable at the option of
holders of the notes only upon the satisfaction of certain conditions
and during certain periods, and, thereafter, at any time until the close
of business on the second scheduled trading day immediately preceding
the maturity date. Upon exchange, the notes will be exchangeable into
cash, shares of the Company’s Class A common stock or a combination of
cash and shares of the Company’s Class A common stock, at the Operating
The Operating Partnership may not redeem the notes pursuant to the terms
of the indenture that will govern the notes prior to the maturity date
except to the extent necessary to preserve the Company’s status as a
real estate investment trust for U.S. federal income tax purposes.
The Operating Partnership estimates that the net proceeds from the
offering of the notes will be approximately $247.0 million (or
approximately $284.1 million if the initial purchaser exercises its
option to purchase additional notes in full), after deducting fees and
estimated expenses payable by the Operating Partnership. The Operating
Partnership expects to use the net proceeds from the offering to reduce
amounts outstanding under its revolving credit facility, including
amounts used to finance its recent property acquisitions and to repay
The notes and any shares of the Company’s Class A common stock that may
be issued upon exchange of the notes have not been registered under the
Securities Act or any state securities laws and, unless so registered,
may not be offered or sold in the United States, except pursuant to an
exemption from the registration requirements of the Securities Act and
applicable state laws.
This release does not constitute an offer to sell or a solicitation of
an offer to buy any of the notes or shares of the Company’s common
stock, nor shall there be any sale in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to the registration
or qualification thereof under the securities laws of any such
jurisdiction. Any offers of the securities will be made only by means of
a private offering circular.
About Empire State Realty Trust
Empire State Realty Trust, Inc. owns, manages, operates, acquires and
repositions office and retail properties in Manhattan and the greater
New York metropolitan area, including the Empire State Building.
Empire State Realty Trust Investor Relations
Source: Empire State Realty Trust, Inc.