WASHINGTON - Easterly Government Properties , Inc. (NYSE:DEA), a real estate investment trust that specializes in properties leased to U.S. Government agencies, has successfully entered into a master note purchase agreement. The company will issue $200 million in senior unsecured notes at a fixed rate of 6.56%, with a 210 basis point spread over ICUR9 for a term of nine years.
The agreement includes two series of notes: $150 million of Series A Senior Notes were issued by Easterly Government Properties LP, the company's operating partnership, on Tuesday, and an additional $50 million of Series B Senior Notes are expected to be issued on or about August 14, 2024, subject to customary closing conditions.
Allison Marino, Easterly’s Chief Financial and Chief Accounting Officer, remarked on the transaction, highlighting the strong investor support and the favorable pricing achieved. Marino attributed this success to the company's investment-grade balance sheet and the high credit quality of its tenant base.
The newly issued Senior Notes are not registered under the Securities Act of 1933 or any state securities laws and will not be offered or sold in the U.S. or to U.S. persons unless they are registered or exempt from registration requirements.
Easterly Government Properties, headquartered in Washington, D.C., focuses on acquiring, developing, and managing Class A commercial properties leased to the U.S. Government. The management team is known for its specialized expertise in meeting the strategic and operational needs of government agencies.
These latest financial movements by Easterly Government Properties are based on a press release statement and aim to extend the company’s average debt maturities, as well as to diversify its capital structure. The company has not provided any guidance on the anticipated use of the proceeds from the note issuance. As with all forward-looking statements, actual results could differ materially from those projected due to various known and unknown risks and uncertainties.
InvestingPro Insights
Easterly Government Properties, Inc. (NYSE:DEA) has recently taken significant steps to strengthen its financial position through the issuance of senior unsecured notes. As investors gauge the potential impact of these financial instruments on the company's future, key metrics and insights from InvestingPro provide a deeper understanding of Easterly's market standing and performance.
The company's market capitalization currently stands at $1.31 billion, reflecting its size and investor valuation within the market. Despite a challenging economic environment, Easterly presents a noteworthy dividend yield of 9.31%, signaling its commitment to returning value to shareholders. This dividend yield is particularly attractive for income-focused investors and stands out as a compelling aspect of the company's financial profile.
InvestingPro data also reveals that Easterly's price-to-earnings (P/E) ratio is at 58.31, which is considered high, indicating that the market has high expectations for the company's future earnings growth. However, the P/E ratio adjusted for the last twelve months as of Q1 2024 is slightly higher at 61.86, suggesting that investors are paying a premium for the company's earnings relative to its share price.
InvestingPro Tips reveal that analysts are optimistic about the company's profitability, predicting Easterly will be profitable this year. Additionally, the company has been profitable over the last twelve months, which may instill confidence in investors considering the company's ability to manage its financial obligations and continue its track record of performance.
For investors looking to delve further into Easterly Government Properties' financial health and future prospects, additional InvestingPro Tips are available, providing a comprehensive analysis of the company's financials, market position, and potential risks and opportunities. Interested readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which includes access to these valuable insights.
Overall, Easterly's strategic financial maneuvers and robust dividend yield, coupled with a positive outlook from analysts, position the company as an intriguing option for investors seeking exposure to real estate assets with government tenancy.
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