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Dream Impact 5 50 Convertible Unsecured Subordinated Debentures T.MPCT.DB

Alternate Symbol(s):  T.MPCT.DB.A

Dream Impact Trust is a Canada-based open-ended trust dedicated to impact investing. The Company operates through two segments: Development and investment holdings, and recurring income. The Development and investment holdings segment comprised direct and indirect investments in residential and mixed-use developments, a hospitality asset, and participating mortgage receivables. The Recurring income segment comprised a portfolio of commercial real estate income properties and multi-family rental assets in the Greater Toronto Area (GTA) and Ottawa/Gatineau, a utility asset, and interest-paying corporate loans. The Company is managed by Dream Asset Management Corporation (DAM).


TSX:MPCT.DB - Post by User

Post by eoim2on Oct 17, 2024 6:09am
74 Views
Post# 36269404

Debt to Asset Ratio of 74% is too risky!

Debt to Asset Ratio of 74% is too risky!To understand why many analysts warn about the high leverage level of MPCT  with debt to asset near 74% or more, you have to not look at the balance sheet but dig into debts in various Equity Accounted Investments. While these equity accounted debts may be non recourse upon default,  they still represent a major cashflow drag on this tiny company, paying almost $30 million in interest yearly which is triggerin.g the sell-off of most of their 100% owned commercial
properties.

I am not telling you not to buy it. Just informing you the debt information you will not see by just glancing through the balance sheet which I found misleading. Maybe this is how developers do it. For me, debt is debt and must all be reported and not magically reported as Net Asset when asset can be inflated.
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