CoreSite Gets Vote Of Confidence From Lenders: Unsecured Credit
January 8th, 2013 By: Jason Verge
Data center provider CoreSite Realty has reworked its revolving credit facility, increasing its borrowing power $225 million to $355 million and changing the line from secured to unsecured. CoreSite, which operates a network of 14 data center in nine major U.S. markets, intends to use the credit line primarily to fund expansion and development projects.
The expanded borrowing capacity gives CoreSite flexibility as it develops additional data center properties, including a recently-announced greenfield data center construction project in northern Virginia. The shift to an unsecured loan shows lender confidence in CoreSite’s business, the company said. A secured loan is backed by collateral, which in CoreSite’s case included five data center properties that secured the previous revolving credit line.
“We are pleased with the enhanced financial flexibility and cost savings that the amended facility provides CoreSite as we continue to pursue our growth objectives,” commented Jeff Finnin, Coresite’s Chief Financial Officer. “The move to unsecured debt, as well as the size and term of the facility, signals our lending group’s confidence in our operating model and we appreciate their ongoing support.”
The revolving credit facility has a five-year term through January 2018, including a one-year extension option, and the interest rate spread was reduced by 25 basis points.