Retailer David Jones has launched a A$366 million financing package which includes the first single-tenant commercial mortgage-backed securities issue in Australia backed by the quality of the property, rather than the credit rating of the tenant.
The overall package structure is a high-yielding property trust, the aim of which is to finance a sale-and-leaseback of the company's five stores in Sydney, New South Wales, and Melbourne, Victoria.
The trust, which will be listed, will issue geared infrastructure yield securities based on its capital structure of A$87 million equity and A$279 million debt.
The A$133 million floating-rate CMBS tranche will comprise part of the debt component, the balance consisting of A$81.2 million of syndicated bank debt and A$64.8 million of listed debt. Deutsche Bank is lead manager and underwriter.