Kenedix Retail REIT: Notice Regarding Change in Base Interest Rate for Loan Agreement and Interest Rate Swap Agreement Due to LIBOR Shutdown Announcement
Translation from the Japanese original
23 December 2021
To all parties involved
REIT Issuer:
Kenedix Retail REIT Corporation
Representative: Moyuru Watanabe, Executive Director
(Securities code: 3453)
Asset manager:
Kenedix Real Estate Fund Management, Inc.
Representative: Masahiko Tajima, President and CEO
Contact:Koichiro Nobata, Head of Strategic Planning,
Retail REIT Department
PHONE :+ 81-3-5157-6013
Notice regarding the change in the base interest rate for the loan agreement and
Interest Rate Swap Agreement Due to LIBOR Cessation Announcement
Kenedix Retail REIT Corporation (âKRRâ) today announced its decision to modify the base interest rate on loan agreements (borrowings) and interest rate swaps (the âModificationâ), as set out herein. below due to the end of the publication of the London Interbank Offered Rate (LIBOR) at the end of December 2021.
1. Details of the change
- Loan contract (loans)
Quantity |
Interest rate |
|||||
Series |
Lender |
(millions |
Above: before the change |
|||
yen) |
Lower: after the change |
|||||
Basic rate |
||||||
(ICE Benchmark Administration Limited (“IBA”) JPY LIBOR 6 months) |
||||||
Japanese life |
+ 0.70000% |
|||||
24-B |
Assurance |
700 |
Basic rate |
|||
Society |
(Overnight risk-free benchmark rate compounded in arrears |
|||||
(TONA / Observation lag) (Note 1) + Adjusted reference rate (Note 2)) |
||||||
+ 0.70000% |
(2) Interest rate swap contract
Series |
24-B |
||||
Counterparty |
Nomura Securities Co., Ltd. |
||||
Notional amount (million yen) |
700 |
||||
Fixed interest rate for |
0.2130% |
||||
Payment |
|||||
Interest |
Floating interest rate for |
Base rate (IBA JPY LIBOR 6 months) |
|||
rates |
received |
||||
Above: before the change |
TONA / Observation lag + Adjusted reference rate (Note 3) |
||||
Lower: after the change |
|||||
Start date |
September 28, 2018 |
||||
Termination date |
March 31, 2025 |
||||
(Note 1) The benchmark risk-free overnight compounded arrears rate (TONA / Observation Shift) is derived from an unsecured overnight call rate for the Japanese yen (TONA) published by the Bank of Japan or the successors of the administration. The rate is a daily TONA compounded during the observation period (while applying single rates of TONA from the preceding working days to the holidays in the period), which is divided by the number of days in the period, multiplied by 360 and rounded to the fifth decimal place. The above working days refer to the days when the Tokyo Unsecured Silver Market is open. The observation period above means that a period begins 10 business days before the first date of an applicable interest period and ends one day before 10 business days before the last date of the interest period.
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Translation from the Japanese original
(Note 2) The adjusted reference rate is a spread adjustment, 0.05809% per annum, applied in order to minimize the transfer of value between the parties concerned when the base interest rates change. The figure is the corresponding spread adjustment for each period published by Bloomberg Index Services Limited on March 5, 2021, and is recommended by the Cross-Industry Committee on Japanese Yen Interest Rate Benchmarks, whose secretariat is the Bank of Japan.
(Note 3) The Series 24-B interest rate has been essentially fixed at 0.91300% by the interest rate swap agreement, and the essentially fixed interest rate will not be changed after the change.
2. Other questions
The risks associated with the early repayment of borrowed funds remain unchanged from those listed in KRR’s securities report submitted on December 23, 2021.
KRR website address: https://www.krr-reit.com/en/
This notice is the English translation of the Japanese announcement of December 23, 2021. However, no assurance or warranty is given as to the completeness or accuracy of this English translation.
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