Piedmont Realty Trust Announces Pricing of $200,000,000 Exchangeable Senior Notes Offering
Piedmont raises low-coupon exchangeable debt to refinance 9.25% 2028 notes and fund a concurrent $50 million share repurchase.
Rhea-AI Summary
Piedmont Realty Trust (PDM) priced a private offering of $200 million aggregate principal amount of 2.875% exchangeable senior notes due 2031 to qualified institutional buyers, to settle on September 17, 2026, with Piedmont fully guaranteeing the notes on a senior, unsecured basis.
The notes bear 2.875% interest, payable semi-annually, and mature on February 1, 2031. Initial purchasers have a 13-day option to buy up to an additional $30 million of notes. The initial exchange rate is 79.0514 shares per $1,000 principal, implying an exchange price of $12.65 per share, a 37.5% premium to the $9.20 last reported share price. Net proceeds are estimated at $194.3 million, or $223.5 million if the option is fully exercised. The operating partnership plans to use proceeds, along with other funding sources, to redeem all outstanding 9.250% senior notes due 2028 and to fund a concurrent $50 million repurchase of 5,434,782 common shares at $9.20.
Positive
- $200M–$230M low-coupon (2.875%) exchangeable notes due 2031 priced in Rule 144A offering
- Estimated net proceeds of up to $223.5M before planned uses
- Refinancing 9.250% senior notes due 2028 with 2.875% notes should lower interest cost
- Concurrent share repurchase of $50M (5,434,782 shares) at $9.20 reduces public float
- Initial exchange price of $12.65 reflects a 37.5% premium to last share price
Negative
- Exchange feature creates potential equity dilution at an exchange price of $12.65 per share
- Approximately $50M of proceeds allocated to share repurchases rather than debt reduction
- Redemption of 2028 notes will require payment of a make-whole premium and accrued interest
News Explained
The notes remain pre-settlement, and any future exchange may be paid in cash, shares, or both, leaving dilution conditional on the settlement choice.
The notes have been priced but are not yet settled: issuance and sale are scheduled for
At a future exchange, the Operating Partnership may choose cash, shares, or a combination; delivering shares would increase the share count and reduce existing holders’ percentage ownership, making dilution conditional on the settlement method.
Key Figures
- Principal Amount
- $200,000,000
- Exchangeable senior notes offering
- Interest Rate
- 2.875% per annum
- Notes due 2031
- Additional Notes Option
- $30,000,000
- Option granted to initial purchasers
- Maturity Date
- February 1, 2031
- Exchangeable senior notes
- Initial Exchange Price
- $12.65 per share
- Piedmont common stock
- Exchange Price Premium
- Approximately 37.5%
- Over the September 14, 2026 last reported sale price
- Net Proceeds
- Approximately $194.3 million
- After discounts, commissions, and estimated offering expenses
- Concurrent Share Repurchase
- Approximately $50 million
- Repurchase of Piedmont common stock from certain note purchasers
Previous Offering Reports
-
Refinancing plan targeted outstanding 2028 notes with new senior debt.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Key Terms
exchangeable senior notes financial
rule 144a regulatory
at-the-market equity program financial
real estate investment trust financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
Atlanta, GA, Sept. 14, 2026 (GLOBE NEWSWIRE) -- Piedmont Realty Trust, Inc. (NYSE: PDM) (“Piedmont”) today announced that its operating partnership, Piedmont Operating Partnership, LP (the “Operating Partnership”), priced its offering of
The notes will be senior, unsecured obligations of the Operating Partnership and will accrue interest at a rate of
The notes will be redeemable, in whole or in part (subject to certain limitations), for cash at the Operating Partnership’s option at any time, and from time to time, on or after August 6, 2029 and on or before the 60th scheduled trading day immediately before the maturity date, but only if the last reported sale price per share of Piedmont’s common stock exceeds
If a “fundamental change” (as defined in the indenture that will govern the notes) occurs, then, subject to a limited exception, noteholders may require the Operating Partnership to repurchase their notes for cash. The repurchase price will be equal to the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the applicable repurchase date.
The notes will be entitled to the benefits of a registration rights agreement pursuant to which Piedmont will agree to register, under the Securities Act, the resale of the shares of Piedmont’s common stock, if any, issuable upon exchange of the notes within specified time periods and subject to certain limitations.
The Operating Partnership estimates that the net proceeds from the offering will be approximately
The Operating Partnership expects to use approximately
The offer and sale of the notes, the guarantee and any shares of Piedmont’s common stock issuable upon exchange of the notes have not been registered under the Securities Act or any other securities laws, and the notes, the guarantee and any such shares cannot be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and any other applicable securities laws. Although the Operating Partnership and Piedmont will enter into a registration rights agreement pursuant to which Piedmont will agree to register, under the Securities Act, the resale of the shares of Piedmont’s common stock, if any, issuable upon exchange of the notes, the registration rights agreement will contain significant limitations, and a resale registration statement may not be available at the time investors wish to resell the shares of Piedmont’s common stock, if any, issuable upon exchange of their notes. This press release does not constitute an offer to sell, or the solicitation of an offer to buy, the notes or any shares of Piedmont’s common stock issuable upon exchange of the notes, nor will there be any sale of the notes or any such shares, in any state or other jurisdiction in which such offer, sale or solicitation would be unlawful.
About Piedmont Realty Trust
Piedmont Realty Trust™ (NYSE: PDM) is a fully integrated, self-managed real estate investment company focused on delivering an exceptional office environment. As an owner, manager, developer and operator of approximately 16 MM SF of Class A properties across major U.S. Sunbelt markets, Piedmont Realty Trust is known for its hospitality-driven approach and commitment to transforming buildings into premier “Piedmont PLACEs” that enhance each client’s workplace experience.
Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Piedmont intends for all such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act, as applicable. Such information is subject to certain known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated. Therefore, such statements are not intended to be a guarantee of Piedmont`s performance in future periods. Such forward-looking statements can generally be identified by Piedmont’s use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue” or similar words or phrases that indicate predictions of future events or trends or that do not relate solely to historical matters, and include statements regarding the completion of the offering and the concurrent share repurchase; and the intended use of the net proceeds from the offering. These statements are based on beliefs and assumptions of Piedmont’s management, which in turn are based on information available at the time the statements are made.
The following are some of the factors that could cause Piedmont's actual results and its expectations to differ materially from those described in Piedmont’s forward-looking statements: economic, regulatory, socio-economic, technological (e.g., artificial intelligence and machine learning, virtual meeting platforms, etc.), and other changes that impact the real estate market generally, the office sector or the patterns of use of commercial office space in general, or the markets where we primarily operate or have high concentrations of revenue; the impact of competition on our efforts to renew existing leases or re-let space on terms similar to existing leases; lease terminations, lease defaults, lease contractions, or changes in the financial condition of our tenants, particularly by one of our large tenants; impairment charges on our long-lived assets or goodwill resulting therefrom; the success of our real estate strategies and investment objectives, including our ability to implement successful redevelopment and development strategies or identify and consummate suitable acquisitions and divestitures; the illiquidity of real estate investments, including economic changes, such as fluctuating interest rates, costs of construction, improvements and redevelopments, and available financing, which could impact the number of buyers/sellers of our target properties, and regulatory restrictions to which real estate investment trusts (“REITs”) are subject and the resulting impediment on our ability to quickly respond to adverse changes in the performance of our properties; the risks and uncertainties associated with our acquisition and disposition of properties, many of which risks and uncertainties may not be known at the time of acquisition or disposition; development and construction delays, including the potential of supply chain disruptions, and resultant increased costs and risks; future acts of terrorism, civil unrest, or armed hostilities in any of the major metropolitan areas in which we own properties; risks related to the occurrence of cybersecurity incidents, including cybersecurity incidents against us or any of our properties, vendors, or tenants, or a deficiency in our identification, assessment or management of cybersecurity threats impacting our operations and the public's reaction to reported cybersecurity incidents, including the reputational impact on our business and value of our common stock; costs of complying with governmental laws, regulations and policies, including environmental standards imposed on office building owners; uninsured losses or losses in excess of our insurance coverage, and our inability to obtain adequate insurance coverage at a reasonable cost; additional risks and costs associated with directly managing properties occupied by government tenants, such as potential changes in the political environment, a reduction in federal or state funding of our governmental tenants, government layoffs or an increased risk of default by government tenants during periods in which state or federal governments are shut down or on furlough; significant price and volume fluctuations in the public markets, including on the exchange on which we listed our common stock; risks associated with incurring mortgage and other indebtedness, including changing capital reserve requirements on our lenders and rising interest rates for new debt financings; a downgrade in our credit ratings, the credit ratings of the Operating Partnership or the credit ratings of our or the Operating Partnership's unsecured debt securities, which could, among other effects, trigger an increase in the stated rate of one or more of our unsecured debt instruments; the effect of future offerings of debt or equity securities on the value of our common stock; additional risks and costs associated with adverse U.S. global and economic conditions, inflation and potential increases in the rate of inflation, including the impact of a possible recession, uncertainty and volatility in financial markets, and any changes in governmental rules, regulations, and fiscal policies; uncertainties associated with environmental and regulatory matters; changes in the financial condition of our tenants directly or indirectly resulting from geopolitical developments that could negatively affect important supply chains and international trade, the termination or threatened termination of existing international trade agreements, or the implementation of tariffs or retaliatory tariffs on imported or exported goods; the effect of any litigation to which we are, or may become, subject; additional risks and costs associated with owning properties occupied by tenants in particular industries, such as oil and gas, hospitality, travel, co-working, etc., including risks of default during start-up and during economic downturns; changes in tax laws impacting REITs and real estate in general, as well as our ability to continue to qualify as a REIT under the Internal Revenue Code of 1986, as amended, or other tax law changes which may adversely affect our stockholders; the future effectiveness of our internal controls and procedures; and other factors, including the risk factors discussed under Item 1A. of our Annual Report on Form 10-K for the year ended December 31, 2025.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Piedmont cannot guarantee the accuracy of any such forward-looking statements contained in this press release, and Piedmont does not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Research Analysts/ Institutional Investors Contact:
770-418-8592
investor.relations@piedmontreit.com
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How and when can holders exchange the new notes into Piedmont common stock?
Before November 1, 2030, noteholders may exchange their notes only upon the occurrence of certain specified events. From and after November 1, 2030 until the close of business on the second scheduled trading day immediately before the February 1, 2031 maturity date, noteholders may exchange at any time at their election. The operating partnership will settle exchanges in cash or a combination of cash and shares of Piedmont’s common stock, at its option.
Under what conditions can Piedmont’s operating partnership redeem the notes before maturity?
The notes are redeemable for cash, in whole or in part (subject to limitations), at the operating partnership’s option from August 6, 2029 until the 60th scheduled trading day before maturity, if Piedmont’s share price exceeds 130% of the exchange price for a specified period and other conditions are met. The operating partnership may also redeem at any time, in whole or in part, if needed to preserve Piedmont’s REIT status, or in whole if less than 10% of the original principal amount remains outstanding and certain conditions are satisfied. In all cases, the redemption price equals principal plus accrued and unpaid interest.
What protections do noteholders have in the event of a fundamental change?
If a “fundamental change” as defined in the indenture occurs, and subject to a limited exception, noteholders may require the operating partnership to repurchase their notes for cash at a price equal to the principal amount of the notes to be repurchased plus accrued and unpaid interest to, but excluding, the applicable repurchase date.
Is this offering registered under the Securities Act, and who can buy the notes?
The notes, the guarantee and any shares of Piedmont’s common stock issuable upon exchange of the notes are not registered under the Securities Act or other securities laws and may be offered or sold only pursuant to an applicable exemption or in a transaction not subject to registration. The offering is being made privately to persons reasonably believed to be qualified institutional buyers under Rule 144A.