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June 3, 2013 /CNW/ - Timbercreek Senior Mortgage Investment Corporation (the "Company") announced today that it will continue to maintain its current monthly distribution of
December 31, 2013 which represents a 6.6% yield per Class A share on an annualized basis, based on the closing trading price for the shares on
May 31, 2013.
The Company's distributions are generated from cash flow not only from interest earned on the mortgages, but also from loan origination fees paid by the borrowers at the time of funding, 100% of which are passed on to investors as further income. These origination fees represented more than 20% of the cash flow generated by the Company in 2012.
"Having sourced over
$450M worth of mortgage loans thus far in 2013, we are very pleased with the continued demand we are seeing from high quality commercial borrowers" explained
Andrew Jones, Managing Director, Debt Investments for the Manager. "In addition, as materially all of the Company's investable cash is currently deployed, we are now offering syndication opportunities to our institutional partners to help satisfy this strong demand."
"Due to this sustained demand for our customized shorter term loans, and the healthy pre-payment activity we are seeing,
$220 million of the Company's portfolio of mortgage loans have been re-paid, and then re-invested in new loans, over the previous 12 months. The revenue generated from new origination fees, on top of the healthy demand that we continue to see in this underserved market, makes us confident that the Company's current monthly distribution will be maintained throughout the year."
"The fundamentals also continue to support the commercial real estate market in
Canada," added Mr. Jones. "With the exception of the condo market where our exposure is negligible, there has been a very limited addition to the supply of new properties across
Canada. Demand for commercial real estate also remains strong from investors seeking regular cash flow, such as private investors, pension funds, REITS, and foreign investors."
The Company invests in a diversified portfolio of first mortgages, selected and determined to be high quality by the Manager. The mortgages are secured primarily by income-producing real estate, such as multi-residential, office, retirement, and retail properties, located in large urban markets across
The Company's loan portfolio stood at
$368 million at the end of the first quarter of 2013, with a weighted average loan-to-value ratio of 52.6%. The Company's investment objective is to preserve capital while generating attractive, stable returns to allow it to pay monthly distributions to its shareholders.
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Certain statements contained in this news release may contain projections and "forward looking statements" within the meaning of that phrase under Canadian securities laws. When used in this news release, the words "may", "would", "should", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions may be used to identify forward looking statements. By their nature, forward looking statements reflect the Manager's and the Company's current views, beliefs and assumptions and are subject to certain risks and uncertainties, known and unknown, including, without limitation, risks disclosed in the Company's public filings. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward looking statements. The Company does not intend to nor assumes any obligation to update these forward looking statements whether as a result of new information, plans, events or otherwise, unless required by law.
SOURCE Timbercreek Senior Mortgage Investment Corporation