SCOTTSDALE, Ariz., Jan. 30, 2015 /PRNewswire/ -- IMH Financial
Corporation ("IMHFC" or the "Company") is pleased to announce that
it has restructured its corporate debt which will significantly
enhance the Company's financial position. On January 23, 2015, Calmwater Capital 3, LLC
("Calmwater") a division of Karlin Real Estate ("Karlin"), provided
new debt instruments to IMHFC in the aggregate principal amount of
$78.8 million for the purposes of
refinancing the Company's $36.0
million senior secured loan with NWRA Ventures I, LLC and a
$24.8 million loan with First Credit
Bank to two of the Company's affiliates, as well as to provide
working capital for certain development activities and operational
costs.
"This new debt structure is a crucial step towards the future
success of the company," said Lawrence D.
Bain, Chairman and CEO of IMHFC. "This represents the
completion of the payoff on the New World financing of
2011. We are excited to work with Karlin as our new senior
lender on these assets. We found that the Karlin team brought a
diverse skill set to the table with a comprehensive approach to its
analysis that is unique to the investment community. The
refinancing will materially reduce our interest expenses, as well
as provide the capital required to fund the balance of our equity
commitment of $11.8 million for our
new construction in Apple Valley, Minnesota. This refinancing
closes another chapter of the IMH legacy matters and helps to
position IMH for future growth."
The general terms of the respective loans are as follows:
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(i)
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The first loan is a
$50.0 million non-recourse loan secured by first liens on the
Company's two operating hotel properties located in Sedona, Arizona
("the Sedona Loan"). L'Auberge de Sedona is a AAA Four Diamond
luxury inn and spa with an extraordinary and unique location along
the banks of Oak Creek in Sedona, Arizona. L'Auberge is considered
to be one of the most beautiful hotels in the world and has
received countless awards and accolades from hospitality
organizations and media. The Orchards Inn is an adjacent hotel
with stunning views of Sedona's world famous red rocks, located
within steps of shopping and activities. The Sedona Loan
requires interest-only payments beginning on March 1, 2015 with a
rate of 6.75% per annum plus the greater of (a) LIBOR or (b) 0.50%
per annum. The Sedona Loan has a maturity date of February 1,
2018 with an option to extend for two 12-month periods. The
Sedona Loan is subject to a non-recourse carve-out guaranty by the
Company which also includes a guarantee of completion of certain
capital improvements at the Company's hotel properties. The
Company is permitted to make optional prepayments at any time,
subject to a yield maintenance prepayment fee if the prepayment is
made prior to February 1, 2016, and a .50% prepayment premium if
paid prior to February 1, 2017, and other conditions set forth in
the loan agreement.
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(ii)
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The second loan is a
$24.4 million non-recourse loan ("Asset Loan 1") secured by first
liens on certain IMHFC real estate assets as well as pledges of
interests held by Company affiliates. Asset Loan 1 requires
interest-only payments beginning on March 1, 2015 with an interest
rate of 8.5% per annum plus the greater of (a) LIBOR or (b) 0.50%
per annum. Asset Loan 1 has a maturity date of February 1, 2017,
with an option to extend for one 12-month period. Asset Loan 1
is subject to a non-recourse carve-out guaranty by the Company
which also includes a guarantee of completion of certain
entitlement work related to a certain IMHFC real estate
asset. The Company is permitted to make optional prepayments
at any time, subject to a variable yield maintenance prepayment
premium if the prepayment is made prior to November 1, 2015 and
other conditions.
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(iii)
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The third loan is a
$4.4 million non-recourse loan ("Asset Loan 2") secured by first
liens on certain IMHFC real estate assets as well as pledges of
interests held by Company affiliates. Asset Loan 2 requires
interest-only payments beginning on March 1, 2015 with an interest
rate of 8.5% per annum plus the greater of (a) LIBOR or (b) 0.50%
per annum. Asset Loan 2 has a maturity date of February 1, 2017
with an option to extend for one 12-month period. Asset Loan 2
is subject to a non-recourse carve-out guaranty by the Company
which also includes a guarantee of the completion of construction
and entitlement work related to certain IMHFC real estate assets.
The Company is permitted to make optional prepayments at any time,
subject to a variable yield maintenance prepayment premium if the
prepayment is made prior to November 1, 2015 and other
conditions.
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IMH Financial Corporation
IMH Financial Corp. is a
real estate company based in Scottsdale,
Arizona, with extensive experience in various facets of
commercial real estate. IMHFC has considerable financial strength
with more than $100 million in common
and preferred equity and a business plan that focuses on its
current real estate holdings as well as the productive deployment
of investment capital on new opportunities including mortgage
loans, mezzanine financing, hospitality investments, as well as
commercial and multi-family opportunities. Since 2003, IMHFC has
invested over $1.4 billion in real
estate loans and projects. The Company has property or active
projects in Arizona, California, Minnesota, New
Mexico, and Texas. IMHFC
has experience in acquiring, financing, and developing commercial
real estate, as well as in the management of existing commercial
operations. Call IMHFC at 480-480-8400 or visit www.imhfc.com for
more information.
About Karlin Real Estate
Karlin (http://www.karlinre.com) is a Los
Angeles-based real estate investment firm. With more than
$1.5 billion in unleveraged capital
under management, Karlin focuses on acquiring value added
commercial properties, bundled assets as well as performing and
non-performing debt secured by real estate. Through its dedicated
debt platform, Karlin has also provided more than $743 million in senior and mezzanine financing
for the acquisition and refinancing of opportunistic and
transitional real estate assets throughout the United States.
Safe Harbor Statement
The following is a
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995:
Our future plans and other statements in this letter about
expectations, beliefs, projections, future plans and strategies,
anticipated events or trends and similar expressions concerning
matters that are not historical facts constitute forward-looking
statements. In some cases, you can identify forward-looking
statements by terms such as "anticipate," "will," "believe,"
"could," "estimate," "feel," "expect," "intend," "likely," "may,"
"plan," "potential," "should," "see," "hope," "view" and "would" or
the negative of these terms or other comparable terminology.
The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for the disclosure of forward-looking
statements.
Our forward-looking statements are subject to a number of
risks and uncertainties, including without limitation, the risk
that we will be unable or otherwise decide not to make proposed
future distributions and other risks and uncertainties related to
the Company that can be found under the heading "Risk Factors" in
IMH Financial Corporation's most recent annual report on Form 10-K
and other filings with the SEC. These forward-looking
statements are based on information currently available to us and
actual results may differ as a result of many possible events or
factors, not all of which are known to us or are within our
control. If a change occurs, our business, financial condition,
liquidity and results of operations may vary materially from those
expressed in our forward-looking statements. These
forward-looking statements are made only as of the date hereof and
we undertake no obligation, and disclaim any duty, to update or
revise any forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events. You should not place undue reliance on
these forward-looking statements.
As a public reporting entity, IMH Financial Corporation files
periodic reports with the SEC. For additional financial and other
important information pertaining to the Company, individuals can
visit www.sec.gov and reference CIK #1397403.
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SOURCE IMH Financial Corporation