NEW YORK–(COMMERCIAL THREAD) – Ares Commercial Real Estate Corporation (NYSE: ACRE) (the “Company” or “ACRE”) today announced that the Company, through indirect owned subsidiaries ”). CRE CLO financed the interest on 23 senior loans with an initial advance rate of 81% and an initial weighted average coupon of 1 month LIBOR + 1.17%, excluding transaction costs. The CRE CLO is a matched term financing, without recourse and without market value for the Company.
The CRE CLO operation provided the following advantages to the Company:
Reduced weighted average cost of funds
Increase in non-recourse financing from 36% as at September 30, 2020 to 67% of total total outstanding under its financing facilities and securitizations
Allowed ACRE to close $ 146 million in new loans previously held in the Ares real estate debt warehouse
These benefits are expected to have an accretive effect on the Company’s earnings.
“We are very pleased with the execution of our fourth securitization in the current market environment, which we believe validates the strong credit quality of our loan portfolio and the value of Ares Management’s broader franchise.” , said Bryan Donohoe, CEO of ACRE. . “The securitization allowed us to optimize the financing of our existing assets by repaying the outstanding amounts under our secured financing facilities and enabled ACRE to close $ 146 million in seven new loans.
“This is a financially positive transaction for our company that increases our profits,” said Tae-Sik Yoon, CFO of ACRE. “Our ability to close $ 146 million in new loans at the same time as the CRE CLO closes is another example of how Ares’ real estate debt warehouse facility provides substantial benefits to ACRE.”
This press release does not constitute an offer to sell or the solicitation of an offer to buy and there will be no sale of such securities in any state or jurisdiction in which such an offer, solicitation or sale would be illegal before registration or qualification under the securities laws of such state or jurisdiction.
About the commercial real estate company Ares
Ares Commercial Real Estate Corporation is a specialized finance company primarily engaged in creating and investing in commercial real estate loans and related investments. Through its national direct origination platform, the Company offers a wide range of flexible and reliable financing solutions to owners and operators of commercial buildings. The Company provides senior mortgages, as well as subordinated finance, mezzanine debt and preferred stocks, with an emphasis on value-added financing on a variety of properties located in liquid markets across the states. -United. Ares Commercial Real Estate Corporation has been elected and qualified for taxation as a real estate investment trust and is managed externally by a subsidiary of Ares Management Corporation. For more information, please visit www.arescre.com. The content of this website is not, and should not be construed as, incorporated by reference herein.
Statements included in this document may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange. Act of 1934, as amended. , which relate to future events or the future performance or financial condition of the Company. Such statements are intended to be identified with words such as “believe”, “expect”, “intend”, “estimate”, “anticipate”, “will”, “plan”, “Plan” and similar expressions in connection with any discussion of future operational or financial performance. Readers are cautioned not to place undue reliance on these forward-looking statements. These statements do not constitute guarantees of future performance, conditions or results and involve a number of risks and uncertainties. Actual results may differ materially from forward-looking statements due to a number of factors, including risks described from time to time in its filings with the Securities and Exchange Commission. Any forward-looking statement, including that contained herein, speaks only as of the date of this press release, and Ares Commercial Real Estate Corporation assumes no obligation to update any forward-looking statements contained herein.