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Associated Estates Completes $150 Million Private Placement Bond Offering

CLEVELAND, Jan. 22, 2013 /PRNewswire/ -- Associated Estates Realty Corporation (NYSE, NASDAQ: AEC) announced today that it completed the issuance of $150 million of unsecured Senior Notes.

The notes were offered in a private placement with two maturity tranches: $63 million 8-year maturity at 4.02% and $87 million 10-year maturity at 4.45%.  The $150 million total issuance has a weighted average term of 9.2 years at a weighted average interest rate of 4.27%.

"We're thrilled with the outcome of this offering.  Completing this transaction extends our maturities, reduces our floating rate debt and enhances our financial flexibility," said Jeffrey I. Friedman, President and Chief Executive Officer.  

Proceeds from the issuance were used to repay borrowings under the Company's unsecured credit facility, including amounts borrowed in December to repay two mortgages totaling approximately $33.6 million.

"We look forward to building long term relationships with our new investor group.  Additional unsecured debt transactions will become an integral part of our capital structure," said Lou Fatica, Vice President, Treasurer and Chief Financial Officer.  

The Sole Bookrunner and Lead Placement Agent was Bank of America Merrill Lynch and the Co-Placement Agent was RBS Securities Inc.

This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. 

Associated Estates is a real estate investment trust ("REIT") and is a member of the Russell 2000 and the MSCI US REIT Indices. The Company is headquartered in Richmond Heights, Ohio. Associated Estates' portfolio consists of 52 properties containing 13,950 units located in ten states. For more information about the Company, please visit its website at AssociatedEstates.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:  This news release contains forward-looking statements reflecting the current strategies and aspirations of management, which are subject to certain risks, trends and uncertainties that could cause actual results to vary from those indicated, including but not limited to, expectations regarding the company's future business relationships with the investor purchasers of the notes and the continuing availability and/or desirability of unsecured debt financing.  Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release.  These forward-looking statements are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. 

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