Terms

Series

5.000% Series C Cumulative Redeemable Preferred Shares

Liquidation Preference

$25.00

Coupon Rate

5%

Rate Type

Fixed

Annual Dividend

$1.25

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

September 29, 2022

First Call Price

$25.00

Redemption Notice Period

45 days

Capital Stack Ranking

Junior To: All Consolidated Indebtedness Of The Company, Any Equity Securities Issued By The Company That Rank Senior To Series C Preferred Shares With Consent Of At Least Two-Thirds Of Series C Preferred Holders, Indebtedness And Preferred Equity Of Subsidiaries And Joint Ventures (Structural Subordination); Pari Passu With: 5.417% Series 1 Cumulative Convertible Preferred Shares (The Only Other Outstanding Preferred Shares As Of Filing Date); Senior To: Common Shares, All Other Equity Securities Ranking Junior To Series C Preferred Shares

Regulatory (Basel III) Call

Yes

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

Yes

Depositary Share Fraction

0.001

Shares Offered

6,000,000

Prospectus Summary

Federal Realty Investment Trust is offering 6 million depositary shares, each representing 1/1000th of a 5.000% Series C Cumulative Redeemable Preferred Share with a $25 liquidation preference per depositary share. The shares pay a fixed quarterly dividend of $0.3125 per depositary share (5% annual yield on par) payable January 15, April 15, July 15, and October 15, beginning January 15, 2018. These are cumulative, meaning unpaid dividends accrue and must be paid before any junior distributions are made; the dividends will continue to accrue even if the Company lacks earnings or available funds, and accrued dividends are paid in order from earliest to latest. The shares are perpetual (no maturity) unless redeemed, and are callable at the Company's option on or after September 29, 2022, at $25 per depositary share plus accrued dividends. The Series C preferred shares rank senior to Federal Realty's common equity and junior preferred shares, and pari passu with the Company's existing 5.417% Series 1 Cumulative Convertible Preferred Shares (the only other preferred outstanding). They are subordinated to all of the Company's debt obligations (approximately $3.5 billion of consolidated indebtedness as of September 22, 2017) and to any equity securities the Company may issue that are expressly ranked senior to the Series C shares with the consent of two-thirds of Series C holders. Because Federal Realty is a holding company with subsidiaries, holders face structural subordination: all indebtedness and preferred equity of the subsidiaries and joint ventures must be paid before the parent company receives cash to pay Series C dividends and liquidation preferences. The Company has regulatory redemption rights relating to REIT qualification, allowing early redemption if necessary to preserve REIT status. At the $25 offering price, the dividend yield is 5.0% annually ($1.25 per depositary share per year, paid quarterly). Record dates fall on the first day of the month containing each payment date or within 10–30 days prior, as the board designates. As a REIT pass-through vehicle, Series C dividends typically do not qualify for the preferential 15%/20% qualified dividend income (QDI) rates applicable to most corporate dividends, but corporate holders may be eligible for the dividends-received deduction (DRD). Dividend payments are subject to a dividend stopper: if cumulative dividends on the Series C shares fall into arrears for any period, the Company cannot pay dividends on common shares, parity/junior preferred shares, or redeem or repurchase any such shares (except with proceeds of junior securities) until all accrued Series C dividends are paid in full. This protection ensures preferred holders are prioritized in a stressed scenario.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full cumulative dividends on the Series C preferred shares have not been declared and paid (or a sum sufficient for payment set apart) for all past dividend periods, then no dividends may be paid on common shares or junior/parity preferred shares, and no common or junior/parity preferred shares may be redeemed or repurchased, except with proceeds of junior shares or cash set aside in a sinking fund.

Other Preferreds from Federal Realty Investment Trust

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 75 (Strong)