Street Calls of the Week
HOUSTON - Whitestone REIT (NYSE:WSR), a $658 million market cap real estate investment trust with a GOOD financial health score according to InvestingPro, announced Monday it has amended and expanded its credit facility to $750 million, extending maturities and securing lower interest rates through its operating partnership.
The expanded facility consists of a $375 million revolver maturing in September 2029 with two six-month extension options, and a $375 million term loan maturing in January 2031. The revolver carries an initial interest rate of SOFR plus 1.40%, while the term loan is priced at SOFR plus 1.35%. This refinancing comes as the company maintains a healthy current ratio of 2.24, indicating strong ability to meet short-term obligations.
The company also entered into interest rate swaps to fix rates on the term loan portion, locking in rates between 3.36% and 3.42% (plus 1.35%) until maturity.
The new agreement represents a $215 million increase from the previous facility and includes improved terms, such as a reduction in the capitalization rate used for valuation from 7% to 6.75%.
"These improvements reflect the continued strengthening of our operations and financial position, and will provide additional liquidity and financial flexibility," said Dave Holeman, Whitestone’s CEO, in a press release statement.
The refinancing extends Whitestone’s weighted average debt maturity to 2030 with no maturities due in 2026 and reduces the company’s variable debt to approximately 12%.
The facility’s co-lead arrangers and joint-book runners included BMO Capital Markets Corp., BofA Securities, Inc., Capital One, National Association, Citizens Bank, N.A, KeyBanc Capital Markets Inc., Truist Securities, Inc., and U.S. Bank National Association.
Whitestone REIT owns and operates open-air retail centers in Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio. The company has demonstrated strong operational performance with 5.27% revenue growth in the last twelve months and maintains a 4.24% dividend yield, having consistently paid dividends for 16 consecutive years. For detailed analysis and additional insights, access the comprehensive Pro Research Report available on InvestingPro, which covers what really matters about WSR through intuitive visuals and expert analysis.
In other recent news, Whitestone REIT announced its Q2 2025 earnings, reporting an earnings per share (EPS) of $0.10, which exceeded the forecasted $0.08, representing a 25% surprise. However, the company’s revenue slightly missed expectations, coming in at $37.9 million compared to the anticipated $38.33 million. Whitestone REIT also disclosed a $100 million at-the-market equity offering program, partnering with several financial institutions to facilitate this initiative. This development allows the company to offer and sell common shares, potentially increasing its capital base.
Furthermore, JMP Securities and Citizens JMP both reaffirmed their Market Outperform ratings for Whitestone REIT, maintaining a price target of $16.00. Analysts from these firms highlighted the company’s strong portfolio performance and unique leasing strategy, which supports favorable market demographics. In another development, Emmett Investment Management is preparing for a possible boardroom battle, expressing concerns over Whitestone’s capital allocation and governance practices. These recent developments provide investors with a comprehensive view of Whitestone REIT’s current business landscape.
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