ORLANDO, Fla. - NNN REIT, Inc. (NYSE: NNN), a real estate investment trust, today revealed an expansion of its unsecured bank credit facility, increasing the borrowing capacity from $1.1 billion to $1.2 billion.
The revised credit line, which matures in April 2028 with an option to extend to April 2029, retains the original loan conditions, including pricing, and introduces an accordion feature allowing for an increase up to $2.0 billion if needed.
The transaction was facilitated by a consortium of banks, with Wells Fargo Bank, National Association, and Bank of America, N.A. leading the arrangement. Wells Fargo also serves as the Administrative Agent, while Bank of America is the Syndication Agent. Other key financial institutions involved include PNC Bank, Royal Bank of Canada, TD Bank, Truist Bank, U.S. Bank National Association, Morgan Stanley Bank, Mizuho Bank, Sumitomo Mitsui (NYSE:SMFG) Banking Corporation, and Raymond James Bank.
Kevin B. Habicht, Executive Vice President and CFO of NNN REIT, expressed gratitude for the banks' continued support and confidence in the company's business strategy. He emphasized that the expanded credit facility would enhance the company's financial agility and support its ability to capitalize on acquisition opportunities. This financial maneuver is aimed at continuing NNN's impressive record of 34 consecutive years of annual dividend growth.
NNN REIT specializes in the investment of high-quality retail properties, predominantly under long-term, net leases. As of December 31, 2023, the company's portfolio included 3,532 properties across 49 states, totaling approximately 36.0 million square feet of gross leasable area, with an average lease term remaining of 10.1 years.
The announcement of the amended credit facility is based on a press release statement and reflects the company's strategic efforts to strengthen its financial position and support future growth initiatives.
InvestingPro Insights
NNN REIT's recent expansion of its unsecured bank credit facility aligns with the company's track record of financial prudence and strategic growth. With a market capitalization of approximately $7.21 billion, NNN REIT stands as a significant player in the retail property investment market.
The company's commitment to shareholder returns is evident in its impressive history of dividend sustainability, having raised its dividend for 34 consecutive years—an InvestingPro Tip that highlights the REIT's reliability for income-focused investors.
The company's financial health is further underscored by a strong gross profit margin of 96.57% over the last twelve months as of Q1 2023. This level of profitability, combined with an operating income margin of 62.44%, showcases NNN REIT's operational efficiency and its ability to generate substantial earnings from its revenue. Notably, the dividend yield as of early 2024 stands at a robust 5.38%, reflecting an attractive income stream for investors.
Another InvestingPro Tip points to NNN REIT trading at a high P/E ratio relative to near-term earnings growth, with a P/E ratio of 18.31 and an adjusted P/E ratio for the last twelve months as of Q1 2023 at 20.34. This may suggest that the company's stock is priced with optimism regarding its future earnings potential.
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