Granite REIT announces C$500 million green bond offering

TORONTO: Granite Real Estate Investment Trust’s wholly owned subsidiary Granite REIT Holdings Limited Partnership (Granite LP) has priced an offering  of C$500 million aggregate principal amount of 3.062% Series 4 senior unsecured debentures due June 4, 2027.

The Debentures will be guaranteed by Granite and Granite REIT Inc. The Offering of the Debentures is expected to close on or about June 4, 2020, subject to the satisfaction of certain customary closing conditions. The Debentures are being issued as Green Bonds under the Framework.

The Debentures are Granite’s inaugural Green Bond issuance. “Granite is committed to intelligently incorporating environmental, social and governance principles into its portfolio and business practices,” said Kevan Gorrie, President and Chief Executive Officer of Granite. “Our first green bond offering supports Granite’s growing investment in sustainable properties and development.”

The Debentures are being offered on an agency basis by a syndicate of agents co-led by BMO Capital Markets and Scotia Capital Inc. It is a condition of closing that DBRS Morningstar and Moody’s Investor Service, Inc. assign credit ratings of “BBB” with a stable trend or higher, and “Baa2” with a stable outlook or higher, respectively, relating to the Debentures.

Granite is making the Offering in Canada pursuant to its base shelf prospectus dated September 12, 2019. The terms of the Offering will be described in a prospectus supplement to the base shelf prospectus to be filed with Canadian securities regulators in each province and territory of Canada and accessible at www.sedar.com.

Granite LP intends to use the net proceeds from the Offering to finance or refinance, in whole or in part, expenditures associated with Eligible Green Projects as described in the Granite Green Bond Framework.

Through a cross currency interest rate swap, Granite LP has exchanged the Canadian dollar denominated principal and interest payments for U.S. dollar denominated payments, resulting in an effective fixed interest rate of 2.964% for the seven-year term of the Debentures.

Granite is a Canadian-based REIT engaged in the acquisition, development, ownership and management of logistics, warehouse and industrial properties in North America and Europe. Granite owns over 90 investment properties representing approximately 40.3 million square feet of leasable area.