Dundee International REIT has closed its previously announced equity offering of units at a price of USD10.90 per unit.
The syndicate of underwriters, led by TD Securities, elected to exercise its over-allotment option in full, resulting in the issuance of 23,230,000 units for total gross proceeds of USD253.2m.
Dundee International REIT will use the net proceeds from the offering to partially fund the previously announced acquisition of a 1.5 million square foot portfolio of office properties in Germany from investment funds managed by SEB Asset Management and for general trust purposes.
Dundee International REIT intends on closing groups of properties in stages throughout March 2013, subject to the satisfaction or waiver of closing conditions. The REIT has obtained competition clearance from the German Federal Cartel Office and formal waivers of municipal pre-emptive rights from all but two cities. Dundee International REIT has secured USD275.4m (EUR205.6m) of new mortgage financing for the portfolio from three lenders at an average interest rate of 2.34 per cent and an average term to maturity of 6.0 years. In addition, the REIT is in the process of finalising the loan documentation with one additional lender for USD68.9m (EUR51.4m) of new mortgage financing at an interest rate equal to 160 basis points over the applicable six-month Euribor swap rate and a term to maturity of 10 years.