Ares Commercial Real Estate Corporation Leads Closing of Two Loan Commitments Totaling $132.6 Million
CHICAGO--(BUSINESS WIRE)-- Ares Commercial Real Estate Corporation (NYS: 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.
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.
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.
Ares Commercial Real Estate Corporation
Carl Drake, 404-814-5204
KEYWORDS: United States North America Georgia Illinois Missouri
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