iStar gets new $850 million unsecured revolver

By Sara Rosenberg

New York, April 22 - iStar Financial Inc. closed on a new $850 million unsecured revolving credit facility. J.P. Morgan and Bank of America acted as joint lead arrangers on the deal, according to a company news release.

The revolver, which carries an initial interest rate of Libor plus 100 basis points, has a three-year term but contains a one-year extension option.

This new facility replaces the company's existing $300 million credit facility maturing July 2004.

"We are pleased to have completed this new unsecured credit facility with the support of 19 leading banks and financial institutions, of which 14 are new to our unsecured credit. We intend to use this facility as our primary source of working capital and to fund new investment activity going forward," said Catherine D. Rice, chief financial officer, in the release.

"In addition to bearing a more attractive interest rate than our secured credit facilities, this facility will enable the company to more efficiently fund, on an unsecured basis, our new investment volume. This new facility will also allow us to protect proprietary information about our investments that we formerly had to share with our secured lenders, with whom we compete in certain business lines.

"Over time, we intend to reduce capacity on our secured credit facilities, yet maintain a prudent level of availability in the event there are disruptions in the unsecured corporate credit markets. Last month we reduced the capacity under one of our secured credit facilities from $700 million to $250 million and extended the final maturity date under this facility to March 2005."

iStar is a New York finance company focused on the commercial real estate industry.

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