MI-REIT – BT

MI-Reit meets terms for loan extension

MACARTHURCOOK Industrial Reit (MI-Reit) yesterday said that it has satisfied all conditions to get a 60-day extension for its $220.8 million loan facility, which was originally due to expire today.

With the extension, the loans will instead be due on June 16 this year. MI-Reit’s manager remains in advanced negotiations with its lenders in relation to the refinance of the facility, the Reit said.

MI-Reit first said on March 31 that its lenders, National Australia Bank and Commonwealth Bank of Australia, had granted it a 60-day extension for the $220.8 million loan facility. But the extension for the property trust was subject to documentation and satisfaction of certain conditions, which have now been satisfied, MI-Reit said.

On April 1, Moody’s Investors Service downgraded MI-Reit’s corporate family rating from B1 to B2, and added that it was continuing its review of the rating for possible further downgrade. The downgrade reflected the existence of heightened liquidity pressure, given that the company had not yet secured definitive long-term refinancing for its loan originally due on April 18, 2009, Moody’s analyst Kathleen Lee said then.

As at Dec 31, 2008, MI-Reit had $225 million repayable within a year and its gearing ratio stood at 39.7 per cent. The trust lost half a cent to close at 26.5 cents yesterday.