#United States #New York #share repurchase #Star Holdings #Debt Extensions

Star Holdings Announces Debt Extensions and Share Buyback

Star Holdings, listed on NASDAQ under the ticker STHO, recently unveiled important updates that reflect its financial strategy moving forward. As of March 31, 2025, the company disclosed the authorization of a $10 million share repurchase program and critical amendments to its financing agreements.

Share Repurchase Program

The company's Board of Trustees has decided to initiate repurchases of its common shares. The total allocated for the buyback is set at $10 million. These shares will be acquired in various methods, including open market purchases, privately negotiated transactions, or through a Rule 10b5-1 plan, depending on market conditions. Importantly, the repurchase authorization is discretionary and does not commit Star Holdings to a specific minimum purchase. This flexibility allows the company to assess market conditions when executing the program.

Debt Maturity Extensions

In line with financial prudence, Star Holdings has also successfully extended the maturity date of its term loan credit agreements by a year, pushing the due date to March 31, 2028. This extension will enhance the company’s liquidity and provide it with additional time to manage its debt effectively. As of late March 2025, the outstanding principal on the term loan stood at $115 million, highlighting the significant leverage the company is managing in the current economic climate.

Management Agreement Adjustments

Simultaneously, the company has entered into an amended management agreement with Safehold. This includes an increase in the annual management fee from $5 million to $7.5 million for the term spanning from April 1, 2026, to March 31, 2027. Furthermore, in specific scenarios, the “Termination Fee” payable to the manager will rise from $50 million to $55 million. This adjustment signifies Star Holdings' commitment to ensuring high-quality management oversight during a pivotal period.

Amended Margin Loan Facility

Additionally, modifications to the Margin Loan Facility have been implemented. The maturity date for this facility has also been postponed by two years to March 31, 2028. Star Holdings has arranged for up to $15.8 million in additional delayed-draw funding, contingent upon satisfactory conditions. These adjustments aim to reduce financial pressure and provide more favorable loan-to-value ratios and collateral release thresholds.

Outlook

Star Holdings is well-positioned to navigate the complexities of the market. The company's proactive debt management approach, combined with strategic buybacks, is designed to enhance shareholder value and stabilize its financial footing. By maximizing cash flows and optimizing asset management, Star Holdings aims to deliver improved returns to its investors as it focuses on revitalizing its real estate portfolio, which includes interests in Asbury Park Waterfront and Magnolia Green residential developments.

For more detailed inquiries or information, interested parties can reach out using the contact details provided in Star Holdings' SEC filings. Moving forward, the company looks to solidify its market presence through agile financial maneuvers and strategic asset monetization.

Conclusion

Star Holdings' recent financial maneuvers, including a notable $10 million share repurchase initiative and extended debt maturity, illustrate their commitment to optimizing capital structure under current market conditions. Stakeholders will be keenly watching the company's performance as it aims to enhance shareholder value in the evolving landscape of real estate and finance.