Fundamental Income Issues AAA Rated Debt

Barchart · 10/17 13:43

Fundamental Income Properties (“Fundamental Income” or the “Company”), a Phoenix-based net lease real estate company that has acquired and financed over $1.6 billion of single-tenant properties across 43 states and 51 industries since 2020, today announced the closing of $241.0 million of long-term fixed-rate notes designated as Fundamental Income Net-Lease Mortgage Notes, Series 2024-1.

This is the third note issuance under Fundamental Income’s FI Master Trust program, its proprietary structured debt financing vehicle, and its first issuance to achieve a ‘AAA’ rating from Standard & Poor’s Ratings Services (S&P) on the senior class of notes. In addition to the new issuance, S&P also upgraded the outstanding A-1 Notes from FI Master Trust Net-Lease Mortgage Notes, Series 2023-1 from ‘AA’ to ‘AAA’ and affirmed the outstanding ratings for the Series 2023-1 A-2 Notes and the Series 2023-2 A-1 and A-2 Notes.

Chris Burbach, Chief Executive Officer of Fundamental Income, commented, “We are thrilled to announce the latest issuance from our FI Master Trust. Achieving the ‘AAA’ rating from S&P is a testament to the strength of both our team and portfolio and we are immensely proud of this accomplishment. The success of our offering further reflects the trust and confidence our investors have placed in us, and we are grateful for their continued support.”

The notes were issued to a diverse set of institutional investors in three classes of 5-year notes comprised of $144.6 million of Class A-1 notes rated ‘AAA’ by S&P, $72.3 million of Class A-2 notes rated ‘AA’ by S&P and $24.1 million of Class A-3 notes rated ‘A’ by S&P.

In conjunction with the issuance, S&P also upgraded $178.6 million of outstanding A-1 ‘AA’ notes from FI Master Trust Net-Lease Mortgage Notes, Series 2023-1 to ‘AAA’.

“The ability to issue AAA rated debt allows us to better support operating businesses and business owners with efficient real estate capital along with the operational control and flexibility required in today’s business environment,” said Alexi Panagiotakopoulos, Chief Investment Officer of Fundamental Income.

The notes will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. The notes were offered and will be sold in the United States in accordance with Rule 144A under the Securities Act and outside the United States in accordance with Regulation S under the Securities Act.

This press release does not constitute an offer to sell or the solicitation of any offer to buy the notes described herein nor shall there be any sale of the notes in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

ABOUT FUNDAMENTAL INCOME

Fundamental Income Properties is a Phoenix-based net lease real estate company launched in 2020 and backed by Brookfield Asset Management (NYSE: BAM), a global asset manager with approximately $1 trillion in assets under management. Fundamental Income Properties serves as a dedicated real estate capital partner to businesses and business owners across North America providing companies with accretive, predictable capital through sale leasebacks, build-to-suit financing and 100 percent financing for expansion capital for operating companies with establish and growing operations. Led by seven investment partners with over 100 years and $16 billion of cumulative transaction experience, the Company is focused on investing in single-tenant commercial properties, net leased to middle-market businesses operating in a wide variety of industries that directly or indirectly serve the US consumer. For more information, please visit www.fundamentalincome.com.