QTS Enters into Additional Floating to Fixed Interest Rate Swap Agreements Which Further Reduce the Company's Exposure to Interest Rate Risk
Jan 8, 2019
OVERLAND PARK, Kan., Jan. 8, 2019 /PRNewswire/ -- QTS Realty Trust (NYSE: QTS), a leading provider of software-defined and mega-scale data center solutions, announced today that it has entered into $600 million of floating to fixed interest rate swap agreements. These include agreements that effectively extend existing floating to fixed interest rate swap agreements on $400 million of term loan borrowings by an additional two years, coinciding with the respective maturity dates of QTS' existing credit facility term loans. The weighted average effective fixed LIBOR interest rate on the $400 million notional amount of term loan financing, following the execution of these two year swap agreements, will approximate 2.6%, commencing on December 17, 2021 and April 27, 2022 ($200 million of swaps allocated to each term loan), which effectively fixes the Company's interest rate at 3.9% including the 1.3% LIBOR spread in effect today pursuant to the Company's existing credit facility.
QTS also entered into forward interest rate swap agreements that effectively will fix the interest rate on an additional $200 million of term loan borrowings from January 2, 2020 through the current maturity dates, which are December 17, 2023 and April 27, 2024 ($100 million of swaps allocated to each term loan). The Company's weighted average interest rate on floating rate debt as of September 30, 2018 is approximately 3.6%. The weighted average effective fixed interest rate on the $200 million additional notional amount of term loan financing, following the execution of these incremental swap agreements, will approximate 3.9% (LIBOR rate fixed at approximately 2.6% plus the current LIBOR spread of 1.3%), commencing on January 2, 2020.
Taking into account the additional interest rate swap agreements, the Company's pro forma exposure to floating rate debt, as of September 30, 2018, has been reduced to approximately 15% of total debt from approximately 32% of total debt.
QTS Realty Trust, Inc. (NYSE: QTS) is a leading provider of data center solutions across a diverse footprint spanning more than 6 million square feet of owned mega scale data center space throughout North America. Through its software-defined technology platform, QTS is able to deliver secure, compliant infrastructure solutions, robust connectivity and premium customer service to leading hyperscale technology companies, enterprises, and government entities. Visit QTS at www.qtsdatacenters.com, call toll-free 877.QTS.DATA or follow on Twitter @DataCenters_QTS.
Investor Relations Contact
Stephen Douglas, VP Finance
Carter B. Cromley
SOURCE QTS Realty Trust, Inc.