Thomas Properties Group Announces Refinancing of City National Plaza
LOS ANGELES – Thomas Properties Group, Inc. (NASDAQ: TPGI) announced today that on July 6, 2010 TPG/CalSTRS, its joint venture with the California State Teachers’ Retirement System (CalSTRS), closed a new non-recourse first mortgage loan for City National Plaza, its landmark office property in downtown Los Angeles.
The new mortgage loan in the amount of $350 million was made jointly by Metropolitan Life Insurance Company and the New York State Teachers’ Retirement System. The loan bears interest at a fixed rate of 5.9% and is for a term of ten years, to mature in July 2020.
The new mortgage loan refinances the prior first mortgage loan of $348.9 million that was scheduled to mature on July 9, 2010. The prior mezzanine loans totaling approximately $219.1 million, which were also scheduled to mature on July 9, 2010, were purchased by an affiliate of CalSTRS in March, 2010. Concurrent with the closing of the new first mortgage loan, these mezzanine loans were retired and converted into additional equity in City National Plaza through CalSTRS’ interest in TPG/CalSTRS. As a result of this equity infusion, the interest of CalSTRS in City National Plaza was increased from 75% to approximately 92%, and the interest of TPGI in City National Plaza was reduced from 25% to approximately 8%, effective as of the date the mezzanine loans were purchased by CalSTRS’ affiliate. Negotiations between TPGI and CalSTRS continue with regard to a right by TPGI to increase its ownership interest in City National Plaza to its original 25% interest.
“This refinancing is indicative of a recovering debt capital market that is seeking to finance high quality assets with well capitalized sponsors at low loan to value,” stated John Sischo, Co-Chief Operating Officer. “The refinancing and deleveraging of this property positions TPG/CalSTRS to maximize the benefits of owning the premier downtown Los Angeles office property.”
About Thomas Properties Group, Inc.
Thomas Properties Group, Inc., with headquarters in Los Angeles, is a full-service real estate company that owns, acquires, develops and manages primarily office, as well as mixed-use and residential properties on a nationwide basis. The company's primary areas of focus are the acquisition and ownership of premier properties, property development and redevelopment, and property and investment management activities. For more information on Thomas Properties Group, Inc., visit www.tpgre.com.
Forward Looking Statements
Statements made in this press release that are not historical may contain forward-looking statements. Although TPGI believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, these statements are subject to numerous risks and uncertainties. Factors that could cause actual results to differ materially from TPGI’s expectations include actual and perceived trends in various national and economic conditions that affect global and regional markets for commercial real estate services (including interest rates), the availability of credit and equity investors to finance commercial real estate transactions, our ability to enter into or renew leases at favorable rates, which can be impacted by the financial condition of our tenants, risks associated with the success of our development and property redevelopment projects, general volatility in the securities and credit markets, and the impact of tax laws affecting real estate. For a discussion of some of the factors that may cause our results to differ from management’s expectations, see the information under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Factors That May Influence Future Results of Operations” in our Form 10-K for the year ended December 31, 2009 and our quarterly reports on Form 10-Q for 2010, which are filed with the SEC. TPGI disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Thomas Properties Group, Inc.
Diana Laing, 213-613-1900