Goldman Sachs and Bank of Merrill Lynch, Pierce, Fenner & Smith Incorporated are securitizing a loan with the first lien on a portfolio of Toys “R” Us and Babies “R” Us stores, according to rating agency reports.

The deal, dubbed TRU Trust 2016-TOYS, will issue $472 million of notes backed by a single, $512 million loan secured by 123 stores with 5.1 million square feet of rentable area across 29 states.  The loan bears interest at an interest rate equal to one-month LIBOR plus 4.2% and matures in three years, though the borrower has the option to extend the maturity date for two successive one-year terms. If all of the extension options are exercised, the final maturity date will occur in November 2021.

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