Greenbriar Project FinanciingSuperTrader1 ...
SuperTrader1 ...
Correct, Many in this board and investors in general do NOT know project finance at all. It is a completely different animal than investment banking and/or capital markets.
The Project Lender for Sage Ranch is Voya Investment Managament (VIM). VIM is a division of Voya Financial (VF). VF is a USD $734 Billion financial services company that started as the US spin-off of ING Direct from the Netherlands. Voya has a substantial portion of its funds derived from pension management, so for those of us in the full time project finance world, Voya is an "institutional lender" not a "bank lender". The difference is an institutional lender has to match its long term client pension fund obligations with its investments generally in the 7 to 20 year range. In our case the mandate is much shorter as the Altus Report has Sage Ranch project returning all funds within the first 12 months, but our line of credit with Voya lasts for 3.5 years as institutional lenders cannot lend for short periods.
Greenbriar will pay 2% interest on unused funds until the 3.5 year term ends. Of course we can use the funds on other projects with their credit committee approval.
The reason we use an institutional lender over a bank lender is the rate is fixed. Banks go by LIBOR plus a % rate plus a % credit swap. These will vary with credit market changes caused by interest rate changes where an insitutional loan is fixed, so its easier to forecast cash flow.
Voya had their legal team check all issues at Sage Ranch prior to signing the mandate and would not have signed if there were any issues that had risk. Institutional lenders take zero risk and will not undertake a mandate if there is a hint of a problem. The reason is not just safety but also there source of pension funds is committed to each investment pool for 7 years, so their commitment to their clients has to be clear of issues for a longer duration.
Altus main role is it acts as the gatekeeper for the lender. Altus checks all invoices from the General Contractor, matches it against their budget and contract obligations, and then advises the lender to release funds every month only if the invoices contractually match the work that is done. The role of Altus identically matches the same role of that of an IE (independent engineer) in a wind or solar project. Your typical first class gold standard IE firm would be Black and Veatch.
Altus is the gold standard in real estate construction financial oversight. Even though Greenbriar paid their invoice, Altus works for the lender, in our case Altus. Their obligation is to the Lender and the integrity of the financial feasibility and valuation report they performed on Sage Ranch.
We have very big shareholders in Greenbriar that are prolific real estate owners and developers. One Greenbriar shareholder owns over 3 million square feet of commercial and residential estate in Toronto and has currently a 51 story under construction in the heart of Yorkville.
Yes, the major shareholder base of Greenbriar is owned by very significant folks who know the real estate and infrastructure asset world extremely well, know the timelines, the obstacles, and most importantly the rewards. They know are assets well. They play the long game for big returns and do not trade the stock. Accumulate from weak hands. They do not encourage low share prices but they certainly take advantage of the weak and nervous. Delays in big infrastructure is normal to them. Diamond Hands.