Summary
Public Storage (PSA) filed an 8-K on January 24, 2020, to report the completion of its offering of €500 million in 0.875% Senior Notes due 2032. These notes are unsecured and unsubordinated, ranking equally with existing and future unsecured and unsubordinated debt. This issuance represents a strategic move by Public Storage to secure long-term, low-cost financing. The notes mature in 2032, offering a significant runway for the company to utilize these funds. The low interest rate of 0.875% is particularly noteworthy and reflects a strong credit profile for Public Storage in the market. Investors should note the covenants within the Indenture, which include limitations on additional indebtedness and a requirement to maintain unencumbered assets at a level of at least 125% of total unsecured indebtedness, aimed at protecting bondholders.
Key Highlights
- 1Completion of a €500,000,000 offering of 0.875% Senior Notes due 2032.
- 2The Notes are unsecured and unsubordinated, ranking equally with other senior unsecured debt.
- 3Maturity date for the Notes is January 24, 2032.
- 4The annual interest rate on the Notes is 0.875%, payable annually.
- 5The company has the option to redeem the Notes under specific conditions, including a make-whole provision or in the event of adverse tax law changes.
- 6The Indenture includes covenants limiting additional secured and unsecured debt, and requiring a minimum ratio of unencumbered assets to unsecured indebtedness (125%).
- 7The offering was conducted under a previously filed shelf registration statement.