Terra Firma Capital Corporation (TSX-V: TII)
("
Terra Firma" or the
“
Company”), a real estate finance company, today
announced the closing of the previously announced TFCC Senior Real
Estate Fund II (“
Fund II”). Fund II’s target size
is $75,000,000 and will have multiple closings through 2022. Terra
Firma’s commitment to Fund II will be no less than 10% of the
aggregate commitments to Fund II, including the Terra Firma
commitment.
Fund II is the Company’s second fund in 2021
which targets financing residential land acquisitions and
development in the growing and vibrant U.S. housing market. In
anticipation of capitalizing Fund II, the Company has warehoused an
initial portfolio of nine loans and land banking investments
totaling approximately $85,000,000 of commitments (of which over
$32,500,000 has been provided by Terra Firma to date) to seed Fund
II.
To date, Fund II has already received
non-binding interest from investors for over $50,000,000 in
potential investments in Fund II. In the first closing, Fund II
called $26,300,000 of capital of which $20,300,000 is from
investors and $6,000,000 from the Company (as part of its
commitment to the fund) and assumed $26,300,000 of the loans and
land banking investments previously warehoused by Terra Firma. Net
proceeds to Terra Firma of the first closing, totaling $20,300,000,
will be used to recapitalize the Company’s balance sheet, providing
it with fresh capital for new investments.
In the coming months, the Company expects to
obtain additional commitments to Fund II. Fund II can accept up to
$100,000,000 in commitments.
“We are very excited by investor response to our
new fund. Fund II comes on the heels of the success of TFCC’s
previous fund which closed earlier this year,” said Y. Dov Meyer,
Executive Chairman of Terra Firma Capital Corporation. “Our new
fund model is a natural evolution of our loan syndication activity
which has been growing consistently over the last few years.”
“As previously noted, the objective of the fund
initiative is to continue to offer investment opportunities to our
syndicated investors through a fund structure which affords a more
efficient mode of investment coupled with the benefits of
diversification of their holdings, duration of their investments
and the ability to earn higher returns due to a modest level of
leverage through the use by the fund of a line of credit.”
“Furthermore, the fund structure provides the
Company with a more reliable and consistent source of third-party
capital which together with Terra Firma’s own balance sheet offers
the Company the ability to respond quickly to investment
opportunities.”
“In the future we plan on growing our private
capital platform through subsequent funds including funds dedicated
to different loan products and strategies, depending on market
conditions and investor demand.”
About Terra Firma
Terra Firma is a full service, publicly traded
real estate finance company that provides real estate financings
secured by investment properties and real estate developments in
the United States and Canada. The Company focuses on arranging and
providing financing with flexible terms to real estate developers
and owners who require shorter-term loans to bridge a transitional
period of one to five years where they require capital at various
stages of development or redevelopment of a property. These loans
are typically repaid with lower cost, longer-term debt obtained
from other financial institutions once the applicable transitional
period is over or the redevelopment is complete, or from proceeds
generated from the sale of the real estate assets. Terra Firma
offers a full spectrum of real estate financing under the guidance
of strict corporate governance, clarity and transparency. For
further information please visit Terra Firma’s website at
www.tfcc.ca.
Non-IFRS Financial Measures
The TSX-V has neither approved nor disapproved
the contents of this press release. The TSX-V does not accept
responsibility for the adequacy or accuracy of this press
release.
Forward-Looking Information
This Press Release contains forward‐looking
statements with respect matters concerning the business,
operations, strategy and financial performance of Terra Firma,
subsequent closings of Fund II and its target size, commitments to
the initial portfolio, levels of interest from potential investors
in Fund II, Terra Firma’s ability to obtain additional commitments
to Fund II, the expected reliability and consistency of third-party
capital, potential returns to syndicated investors and the
intention for Terra Firma to launch subsequent funds. These
statements generally can be identified by use of forward looking
word such as “may”, “will”, “expects”, “estimates”, “anticipates”,
“intends”, “believe” or “could” or the negative thereof or similar
variations. The future business, operations and performance of
Terra Firma could differ materially from those expressed or implied
by such statements. Such forward‐looking statements are qualified
in their entirety by the inherent risks and uncertainties
surrounding future expectations, including risks relating to market
factors, our ability to fund commitments and obtain sources of
funding for same, that interest in investing by potential investors
may not be realized as expected, if at all, competition, and
dependence on tenants’ financial conditions, environmental and tax
related matters, and reliance on key personnel, as well as the
risks discussed in Terra Firma's most recently filed annual
Management's Discussion and Analysis, any subsequently filed
interim Management's Discussion and Analysis or Terra Firma's most
recently filed Annual Information Form, in each case filed under
Terra Firma’s profile on SEDAR at www. sedar.com. Forward‐looking
statements are based on a number of assumptions which may prove to
be incorrect, including that the general economy, local real estate
conditions and interest rates are stable, the absence of
significant changes in government regulation, and the continued
availability of equity, debt and other sources of capital. There
can be no assurances that forward‐looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward‐looking
statements. The cautionary statements qualify all forward‐looking
statements attributable to Terra Firma and persons acting on its
behalf. Unless otherwise stated, all forward-looking statements
speak only as of the date of this Press Release and Terra Firma
does not assume any obligation to update such statements, whether
as a result of new information, future events or otherwise, except
as required by applicable Canadian securities laws.
The securities offered by Fund II have not been and will
not be registered under the U.S. Securities Act of 1933 and may not
be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
For further information, please contact:
Terra Firma Capital CorporationGlenn
WatchornChief Executive Officer Phone:
416.792.4702gwatchorn@tfcc.ca
or
Terra Firma Capital CorporationY. Dov Meyer Executive Chairman
Phone: 416.792.4709 ydmeyer@tfcc.ca
or
Ali Mahdavi Managing DirectorSpinnaker Capital Markets Inc.
Phone: 416.962.3300am@spinnakercmi.com
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