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AvalonBay Communities (NYSE: AVB) completes $400M 4.350% senior notes offering

Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

AvalonBay Communities, Inc. completed a public debt offering of $400,000,000 principal amount of its 4.350% Senior Notes due 2030. The notes were issued under an existing shelf registration and sold pursuant to an underwriting agreement led by major investment banks. AvalonBay expects net proceeds of about $396.5 million after underwriting discounts and expenses.

The notes bear interest at 4.350% from December 1, 2025, payable semi-annually each June 1 and December 1, and mature on December 1, 2030 unless redeemed earlier. The company plans to use the net proceeds for working capital and general corporate purposes, including potential share repurchases, repayment of commercial paper and other debt, and funding development, acquisitions and structured investments, with temporary investment in cash or equivalents until deployed.

Positive

  • None.

Negative

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Insights

AvalonBay locks in 5-year debt and boosts funding flexibility.

AvalonBay Communities has issued $400,000,000 of 4.350% Senior Notes due 2030, generating estimated net proceeds of about $396.5 million. The notes sit under an existing indenture with U.S. Bank Trust Company as trustee, providing a standardized framework for current and future debt issuance.

The coupon is fixed at 4.350% with semi-annual interest payments starting on June 1, 2026, and final maturity on December 1, 2030 unless redeemed earlier. Use of proceeds is broad: working capital, potential stock repurchases, repayment of commercial paper (which can be issued up to $1,000,000,000 outstanding), development and acquisition of communities, and other corporate debt management.

From an investor perspective, this is a typical funding transaction rather than a transformative event. Its practical effects will depend on how much is allocated to deleveraging versus growth investments or share repurchases, which may become clearer in subsequent company filings and updates.

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported):  December 1, 2025

 

AVALONBAY COMMUNITIES, INC.

(Exact name of registrant as specified in its charter)

 

Maryland

(State or other jurisdiction
of incorporation or organization)

1-12672

(Commission File
Number)

77-0404318

(I.R.S. Employer
Identification No.)

 

4040 Wilson Blvd., Suite 1000

Arlington, Virginia 22203

(Address of principal executive offices)(Zip code)

 

(703) 329-6300

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol   Name of each exchange on which registered
Common Stock, par value $0.01 per share   AVB   New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨

 

 

 

 

 

 

Item 8.01 Other Events.

 

On December 1, 2025, AvalonBay Communities, Inc. (the “Company”) closed the public offering (the “Offering”) of an aggregate of $400,000,000 principal amount of its 4.350% Senior Notes due 2030 (the “Notes”).

 

The Offering was made pursuant to a prospectus supplement dated November 19, 2025 and a base prospectus dated February 23, 2024 relating to the Company’s registration statement on Form S-3 (File No. 333-277313) (the “Registration Statement”). In connection with the Offering of the Notes, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, Mizuho Securities USA LLC and Morgan Stanley & Co. LLC, as representatives of the several underwriters named in the Underwriting Agreement. A copy of the Underwriting Agreement is filed as Exhibit 1.1 to this Current Report on Form 8-K.

 

The Notes bear interest from December 1, 2025, with interest on the Notes payable semi-annually on June 1 and December 1, beginning on June 1, 2026. The Notes will mature on December 1, 2030 unless the Company redeems them earlier.

 

The terms of the Notes are governed by an Indenture between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”) (the “Base Indenture”), dated as of February 23, 2024, as supplemented by the Third Supplemental Indenture between the Company and the Trustee, dated as of December 1, 2025 (the “Third Supplemental Indenture”).

 

The Company estimates that the net proceeds from the sale of the Notes, after deducting the underwriting discount and estimated offering expenses payable by the Company, will be approximately $396.5 million.

 

The Company intends to use the net proceeds from the Offering for working capital and general corporate purposes, which may include the repurchase of outstanding shares of the Company’s common stock pursuant to the Company’s stock repurchase program, repayment of outstanding indebtedness under the Company’s commercial paper program, which allows the Company to issue, from time to time, unsecured commercial paper notes with varying maturities of less than one year up to a maximum amount outstanding at any one time of $1,000,000,000, land acquisitions, the development and redevelopment of residential communities, the acquisition of communities, funding the Company’s Structured Investment Program investments and the repayment and refinancing of other indebtedness. Pending the application of such net proceeds, the Company may temporarily invest all or a portion of the net proceeds from the Offering in cash or cash equivalents and/or hold such proceeds in accordance with the Company’s internal liquidity policy.

 

The foregoing description does not purport to be complete and is subject to, and qualified in its entirety by, reference to the full text of the Base Indenture, the Third Supplemental Indenture and the form of the Notes, which are filed as Exhibits 4.1, 4.2 and 4.3 to this Current Report on Form 8-K and are incorporated herein by reference.

 

In connection with the filing of the Underwriting Agreement, the Company is also filing the opinion and consent of its counsel, Goodwin Procter LLP, regarding the legality of the securities being registered as Exhibits 5.1 and 23.1 hereto, respectively, which are incorporated by reference into the Registration Statement.

 

 

 

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

1.1 Underwriting Agreement, dated as of November 19, 2025, by and among the Company and J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, Mizuho Securities USA LLC and Morgan Stanley & Co. LLC, as representatives of the several underwriters named therein (filed herewith)
   
4.1 Indenture for Debt Securities, dated as of February 23, 2024, between the Company and U.S. Bank Trust Company, National Association (incorporated by reference to Exhibit 4.8 to Form 10-K of the Company filed February 23, 2024)
   
4.2 Third Supplemental Indenture, dated as of December 1, 2025, between the Company and U.S. Bank Trust Company, National Association (filed herewith)
   
4.3 Form of 4.350% Senior Notes due 2030 (attached as Exhibit A to the Third Supplemental Indenture filed as Exhibit 4.2 hereto)
   
5.1 Opinion of Goodwin Procter LLP (filed herewith)
   
23.1 Consent of Goodwin Procter LLP (included in Exhibit 5.1)
   
104 Cover Page Interactive Data File (embedded within the Inline XBRL document) (filed herewith)

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  AVALONBAY COMMUNITIES, INC.
     
Dated: December 1, 2025 By: /s/ Kevin P. O’Shea
    Kevin P. O’Shea
    Chief Financial Officer

 

 

 

FAQ

What did AvalonBay Communities (AVB) announce in this Form 8-K?

AvalonBay Communities, Inc. disclosed that it closed a public offering of $400,000,000 principal amount of its 4.350% Senior Notes due 2030, issued under its existing shelf registration.

What are the key terms of AvalonBays new 4.350% Senior Notes due 2030?

The notes bear interest at 4.350% from December 1, 2025, pay interest semi-annually on June 1 and December 1 starting June 1, 2026, and mature on December 1, 2030 unless redeemed earlier by AvalonBay.

How much cash will AvalonBay Communities (AVB) receive from this notes offering?

AvalonBay estimates net proceeds of approximately $396.5 million from the sale of the notes after deducting the underwriting discount and estimated offering expenses it is paying.

How does AvalonBay plan to use the net proceeds from the $400 million notes offering?

AvalonBay intends to use the proceeds for working capital and general corporate purposes, which may include stock repurchases, repayment of commercial paper and other indebtedness, land acquisitions, development and redevelopment of residential communities, community acquisitions and funding its Structured Investment Program investments.

Who underwrote AvalonBays 4.350% Senior Notes due 2030?

The underwriting agreement was entered into with J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, Mizuho Securities USA LLC and Morgan Stanley & Co. LLC, acting as representatives of the several underwriters.

Under what legal documents were AvalonBays new notes issued?

The notes are governed by a Base Indenture dated February 23, 2024 and a Third Supplemental Indenture dated December 1, 2025, both between AvalonBay and U.S. Bank Trust Company, National Association, as trustee.

What is AvalonBays commercial paper capacity mentioned in the filing?

AvalonBays commercial paper program allows it to issue unsecured commercial paper notes with varying maturities of less than one year, up to a maximum amount outstanding at any one time of $1,000,000,000.
Avalonbay Cmntys Inc

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