MPG Office Trust Announces Mortgage Loan Extension at KPMG Tower
July 11 2012 - 8:30AM
Business Wire
MPG Office Trust, Inc. (NYSE: MPG), a
Southern California-focused real estate investment trust,
announced that it has extended the maturity date of its mortgage
loan at KPMG Tower in Downtown Los Angeles for an additional one
year, to October 9, 2013.
As part of the extension, the Company repaid $35 million of
principal, which reduced the outstanding loan balance from $400
million to $365 million. Additionally, the Company funded a $5
million leasing reserve and agreed to a full cash sweep of excess
operating cash flow beginning on September 9, 2012. Excess
operating cash flow (cash flow after the funding of certain
reserves, the payment of property operating expenses and the
payment of debt service) will be applied to fund a
$1.5 million capital expenditure reserve, to fund an
additional $5 million into the leasing reserve, and
thereafter, to reduce the outstanding principal balance of the
loan.
The interest rate on the loan is LIBOR plus 1.65%. Beginning on
October 10, 2012, the $320.8 million A-Note will bear interest at
LIBOR plus 3.00% and the $44.2 million B-Note will bear interest at
LIBOR plus 5.10%.
About MPG Office Trust,
Inc.
MPG Office Trust, Inc. is the largest owner and
operator of Class A office properties in the Los Angeles
Central Business District. MPG Office Trust, Inc. is a
full-service real estate company with substantial in-house
expertise and resources in property management, leasing and
financing. For more information on MPG Office Trust,
visit our website at www.mpgoffice.com.
Business Risks
This press release contains forward-looking statements based on
current expectations, forecasts and assumptions that involve risks
and uncertainties that could cause actual outcomes and results to
differ materially. These risks and uncertainties include, without
limitation: risks associated with our liquidity situation,
including our failure to obtain additional capital or extend or
refinance debt maturities; risks associated with our failure to
reduce our significant level of indebtedness; risks associated with
the timing and consequences of loan defaults and non-core asset
dispositions; risks associated with our loan modification and asset
disposition efforts, including potential tax ramifications; risks
associated with our ability to dispose of properties with potential
value above the debt, if and when we decide to do so, at prices or
terms set by or acceptable to us; general risks affecting the real
estate industry (including, without limitation, the inability to
enter into or renew leases at favorable rates, dependence on
tenants’ financial condition, and competition from other
developers, owners and operators of real estate); risks associated
with the continued disruption of credit markets or a global
economic slowdown; risks associated with the potential loss of key
personnel (most importantly, members of senior management); risks
associated with joint ventures; risks associated with our failure
to maintain our status as a REIT under the Internal Revenue Code of
1986, as amended, and possible adverse changes in tax and
environmental laws; and potential liability for uninsured losses
and environmental contamination.
For a further list and description of such risks and
uncertainties, see our Annual Report on Form 10-K filed
on March 15, 2012 with the Securities and Exchange
Commission. The Company does not update forward-looking statements
and disclaims any intention or obligation to update or revise them,
whether as a result of new information, future events or
otherwise.
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