Invitation Homes Inc. (NYSE: INVH) (“Invitation Homes” or the “Company”) announced today that it has entered into a new $725 million seven-year unsecured term loan maturing in June 2029.
The sustainability-linked term loan bears interest at rates based on the Company’s senior unsecured credit rating, which equated to an interest rate of Adjusted Term SOFR plus 125 basis points at the time of closing based on the Company’s current credit ratings. Pricing of the term loan can further improve if the Company meets certain ESG performance targets as determined via an independent third-party evaluation, similar to its existing five-year unsecured credit facility.
The new seven-year delayed draw term loan allows the Company to elect to receive a portion of the proceeds at closing, with the opportunity to receive the remaining proceeds in up to three additional draws over a six month period. The Company received proceeds of $150 million in its initial draw at closing, and used these initial proceeds, along with cash on hand, as part of a series of transactions to fully repay its IH 2018-2 securitization. The repayment of IH 2018-2 increased the Company’s unencumbered pool to approximately 78 percent of its wholly-owned properties.
“We’re pleased to have received such a strong commitment from established and new banking partners at attractive rates,” said Ernie Freedman, the Company’s Chief Financial Officer. “We believe the new term loan further strengthens our capital structure and offers us additional flexibility to effectively extend our debt maturities and fund other corporate needs on favorable terms.”
The loan was funded through a group of banks led by Capital One, National Association, as Administrative Agent. Capital One, National Association, The Huntington National Bank, KeyBanc Capital Markets, Inc., M&T Bank, PNC Capital Markets LLC, Regions Capital Markets, and U.S. Bank National Association acted as Joint Lead Arrangers and Joint Bookrunners. BMO Capital Markets Corp. and Raymond James Bank acted as Passive Joint Lead Arrangers.