AFRT Snags $520MM in Financing

American Financial Realty Trust, Jenkintown, Pa., has obtained $520 million financing from Lehman Brothers to partly fund the $704.5 million acquisition of State Street Financial Center, a 1.05 million-square-foot Boston office property.The 20-year loan has an initial floating interest rate period of six months, during which the loan will bear interest at the London interbank offered rate plus 1.25%, the real estate investment trust said. After that, the loan will carry a 5.79% fixed rate for the remainder of the term. This arrangement will enable AFRT to take advantage of the current low interest rate environment "without assuming long-term interest rate risk," according to AFRT. For the remainder of the acquisition price, AFRT is using available cash as well as money from the issuance of $35.9 million of units in the operating partnership of the office property to the original developers.