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TORONTO, March 01, 2018 (GLOBE NEWSWIRE) -- Firm Capital American Realty Partners Corp. (the “Company”) (TSXV:FCA.U) (TSXV:FCA) is pleased to announce the closing of the previously disclosed multi-family residential property acquisitions in New Jersey and Texas, as follows:
Acquisition in Irvington, New Jersey
The Company acquired a multi-family residential portfolio in Irvington, New Jersey (the “Portfolio”), comprised of 7 separate properties and 189 units in total (184 apartment units and 5 ground floor retail units). The Portfolio was acquired by the Company (the “Acquisition”) for a purchase price (excluding transaction costs) of approximately US$17.8 million, representing a going-in capitalization rate of approximately 5.8%, or approximately US$94,180 per unit. The Acquisition was financed with 7 separate 20-year non-recourse first mortgage loans from a U.S. government-sponsored enterprise for approximately US$14.2 million in total, or approximately 80% loan-to-cost, at a weighted average interest rate of approximately 3.8% fixed for the first 5 years, with interest-only for the first 12 months, and a 30-year amortization period.
The Company completed the Acquisition through an investment of approximately US$3.4 million, for a 50% ownership interest in a joint venture with an experienced New York City based real estate owner and operator who owns the other 50%. The Company funded the Acquisition from cash on hand.
Acquisition in Houston, Texas
The Company acquired a multi-family residential property in Houston, Texas (the “Property”), comprised of 12 buildings and 235 apartment units. The Property was acquired by the Company (the “Acquisition”) for a purchase price (excluding transaction costs) of approximately US$15.3 million, representing a going-in capitalization rate of approximately 6.2%, or approximately US$65,106 per unit. The Acquisition was financed with a 10-year non-recourse first mortgage loan from a U.S. government-sponsored enterprise for approximately US$11.6 million, or approximately 76% loan-to-cost, at an interest rate of approximately 4.9% fixed for the 10-year term, with interest-only for the first 12 months, and a 30-year amortization period.
The Company completed the Acquisition through an investment of approximately US$4.7 million, for a 50% ownership interest in a joint venture with an experienced New York City based real estate owner and operator who owns the other 50%. The Company funded the Acquisition from cash on hand.
About the Company
The Company is a U.S. focused real estate investment entity that pursues real estate and debt investments through the following investment platforms:
- Income Producing Real Estate Investments: Acquiring income producing real estate assets in major cities across the United States. Acquisitions are completed by the Company primarily in joint venture partnerships with local industry expert partners who retain property management responsibility; and
- Mortgage Debt Investments: Real estate debt and equity lending platform in major cities across the United States, focused on providing all forms of bridge mortgage loans and joint venture capital.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information in this news release constitutes forward-looking statements under applicable securities law. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expect", "intend" and similar expressions. Forward-looking statements necessarily involve known and unknown risks, including those described in the Company’s Annual Information Form under “Risk Factors” (a copy of which can be obtained at www.sedar.com). Those risks include, without limitation, the ability of the Company to complete the Offering and if so, to allocate the net proceeds as stated above; risks associated with general economic conditions; adverse factors affecting the U.S. real estate market generally or those specific markets in which the Company holds properties; volatility of real estate prices; inability to complete the Company’s single family property disposition program or debt restructuring in a timely manner; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; industry and government regulation; changes in legislation, income tax and regulatory matters; the ability of the Company to implement its business strategies; competition; currency and interest rate fluctuations and other risks.
Readers are cautioned that the foregoing list is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. All forward-looking statements contained in this news release are expressly qualified by this cautionary statement. Except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, either as a result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Kursat Kacira
President & Chief Executive Officer
(416) 635-0221
Sandy Poklar
Chief Financial Officer
(416) 635-0221