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In conjunction with the finalization of this previously announced financing, the individual project loans were increased to $209,700,000 from $209,340,000 and to $46,800,000 from $46,735,000 for the Post Office and Garage, respectively. The $256.5 million of aggregate proceeds has been funded by the underlying lenders and has been deposited along with our gross forward commitment fee of approximately $17.7 million into an escrow account to be administered by The Bank of New York Mellon, as trustee. Upon investment of the escrow account in a portfolio of US Treasury securities, the forward commitment fee will be reduced to approximately $16.2 million which will be used together with the interest earned on the escrow account to pay the interest costs of the loans through August 26, 2010, the anticipated completion date of the projects and the date on which the then remaining escrow balance of $256.5 million is expected to be released to us. We plan to use the $256.5 million of aggregate proceeds to reduce borrowings under our credit facility and for general corporate purposes.
The loans bear interest at 5.93% (versus the initial indication of 5.95%) with interest-only through September 10, 2010 following which they will amortize monthly over a twenty-year period beginning with the October 10, 2010 debt service payment. The loans will be non-recourse and will be secured by mortgages on the Post Office and Garage and by the leases of space at those facilities upon completion of the projects by us and their acceptance by the IRS for occupancy along with other customary conditions, all expected to occur on or about August 26, 2010.
"We are extremely pleased to finalize the terms of the forward financings and have the full loan proceeds of $256.5 million escrowed and available to be disbursed in August 2010 upon delivery of the projects," stated Howard Sipzner, Executive Vice President and Chief Financial Officer of Brandywine Realty Trust. "These financings reflect the high quality of the Post Office and Garage projects along with the attractiveness of the Internal Revenue Service tenancy, and upon funding in 2010, will provide significant liquidity for Brandywine and become key components of our long-term capital structure."
Brandywine was advised on the structuring and placement of the forward financing commitments by CTL Capital, LLC which was advised by the law firm of Duane Morris LLP, and by FBR Capital Markets & Co. The law firm of DLA Piper and the accounting firm of Reznick Group, P.C. provided additional transaction support to Brandywine.
About Brandywine Realty Trust
Brandywine Realty Trust is one of the largest, publicly traded, full-service, integrated real estate companies in the United States. Organized as a real estate investment trust and operating in select markets, Brandywine owns, develops and manages a primarily Class A, suburban and urban office portfolio aggregating approximately 37.3 million square feet, including 26.1 million square feet which it owns on a consolidated basis.
Forward-Looking Statements
Estimates of future earnings per share, FFO per share, common share dividend distributions and certain other statements in this release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our and our affiliates' actual results, performance, achievements or transactions to be materially different from any future results, performance, achievements or transactions expressed or implied by such forward-looking statements. Such risks, uncertainties and other factors relate to, among others: our ability to lease vacant space and to renew or relet space under expiring leases at expected levels; competition with other real estate companies for tenants; the potential loss or bankruptcy of major tenants; interest rate levels; the availability of debt, equity or other financing; risks of acquisitions, dispositions and developments, including the cost of construction delays and cost overruns; unanticipated operating and capital costs; our ability to obtain adequate insurance, including coverage for terrorist acts; dependence upon certain geographic markets; and general and local economic and real estate conditions, including the extent and duration of adverse changes that affect the industries in which our tenants operate. Additional information on factors which could impact us and the forward-looking statements contained herein are included in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2008.
SOURCE Brandywine Realty Trust
http://www.brandywinerealty.com
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