Ares Commercial Real Estate Corporation Leads Closing of Two Loan Commitments Totaling $132.6 Million
Ares Commercial Real Estate Corporation (NYSE: ACRE) announced earlier
today that it led the closing of two new loan commitments totaling
$132.6 million, including a $107.1 million first mortgage loan
commitment collateralized by multi-family properties in Atlanta, Georgia
and a $25.5 million first mortgage loan commitment collateralized by
office properties in Kansas City, Missouri. ACRE’s initial funding on
the two loans was approximately $51.1 million. Shown below are further
details on the two loan commitments.
Atlanta Transaction
ACRE co-originated a $107.1 million first mortgage loan commitment,
which was used to finance the acquisition of three multi-family
properties in diverse Atlanta sub-markets by a sponsor group including
Cortland Partners of Atlanta. They include a 406-unit garden property
just north of the Buckhead sub-market, a 268-unit garden property in the
Emory University area, and a 352-unit garden property in the suburb of
Alpharetta. The loan will also be used to fund certain property-level
improvements and new amenities in support of the sponsor group’s
business plan. At the closing of the transaction on March 28, 2013, ACRE
funded a $26.7 million B-Note, while a $68.1 million A-Note was funded
by a commercial bank. ACRE’s maximum funding obligation is approximately
$39 million.
“ACRE is a reliable and knowledgeable financing source that was
instrumental in allowing us to win the competitive bidding on the
properties and close a complex transaction,” said Steven DeFrancis,
Chief Executive Officer of Cortland Partners. “The team at ACRE
delivered a compelling financial solution that has provided us the
additional flexibility we require to execute our plan for creating value
for these communities.”
Kansas City Transaction
ACRE originated a $25.5 million first mortgage loan commitment
collateralized by two Class A office buildings in the Overland Park
sub-market of Kansas City. The transaction closed on March 29, 2013 with
an initial funding of $24.4 million. The loan will be used to refinance
existing indebtedness and for tenant improvements.
“We are thrilled to originate these two high-quality transactions that
provide additional diversification to our growing investment portfolio,”
said Bruce Cohen, President of ACRE. “We look forward to working with
these new and existing clients as they execute their business strategies
for these properties.”
For the first quarter of 2013, ACRE led the closing of three
transactions totaling $179.6 million in commitments. Of this total, a
$47 million new loan commitment replaced an existing loan commitment in
the same amount. With these transactions, ACRE’s loan portfolio totaled
approximately $407.7 million in outstanding principal as of March 29,
2013.
About Ares Commercial Real Estate Corporation
Ares Commercial Real Estate Corporation is a specialty finance company
that originates, invests in and manages middle-market commercial real
estate loans and other commercial real estate investments. Through its
national direct origination platform, Ares Commercial Real Estate
Corporation provides flexible financing solutions for middle market
borrowers. Ares Commercial Real Estate Corporation intends to elect to
be taxed as a real estate investment trust and is externally managed by
an affiliate of Ares Management LLC, a global alternative asset manager
with approximately $59 billion in committed capital under management as
of December 31, 2012. For more information, please visit ACRE’s website
at arescre.com.
Forward-Looking Statements
Statements included herein may constitute “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of
1995, which relate to future events or our future performance or
financial condition. These statements are not guarantees of future
performance, condition or results and involve a number of risks and
uncertainties. Actual results may differ materially from those in the
forward-looking statements as a result of a number of factors, including
those described from time to time in our filings with the Securities and
Exchange Commission. Ares Commercial Real Estate Corporation undertakes
no duty to update any forward-looking statements made herein.
