Union Bank of Switzerland has closed a new $175 million unsecured line of credit to U.S. Restaurant Properties Inc., a Dallas-based real estate investment trust.
The facility, which will be used for acquisitions, replaces a $110 million secured line of credit. Comerica led the original facility, but the company switched to UBS to "expand the size of the facility" and "lower borrowing rates," said Michael Warren, director of finance at U.S. Restaurant Properties. The unsecured status improves the company's access to credit markets and reduces its cost of capital.
In addition, holders of $40 million of secured long-term notes have agreed to convert to unsecured status, the company said.
The REIT received an investment-grade rating from Duff & Phelps Credit Rating Co. in October 1997. That status lets it lower its cost of borrowing. U.S. Restaurant Properties owns or holds mortgages on 596 locations where Burger King, Arby's, Chili's, and other fast food/casual dining restaurants are operated.