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TORONTO, Oct. 28, 2020 /CNW/ - Tricon Residential
(TSX: TCN) ("Tricon" or the "Company"), a rental housing company
catering to the middle-market demographic throughout the United States and Canada, announced today that it has priced its
2020-SFR2 securitization
transaction.
The transaction, involving the issuance and sale of six offered
classes of fixed-rate certificates with a total face amount of
$440.5 million, was priced at a
weighted average coupon of approximately 1.83% with a term to
maturity of approximately seven years. The anticipated transaction
proceeds represent 67.0% of the value of the securitized portfolio
of 3,319 single-family rental properties. The transaction is
expected to close on or about November 10,
2020.
The net transaction proceeds will be used to repay the Company's
outstanding 2016-SFR1 securitized
financing, refinance short term debt outstanding on the Company's
single-family rental warehouse credit facility and repatriate
approximately $59 million for
corporate debt reduction and single-family rental home
acquisitions.
"I would like to congratulate our team on another well-executed
transaction with an extremely attractive interest rate, as well as
the longest term to maturity and lowest loan-to-value issued in the
single-family rental sector this year. Strong demand for this
transaction was further evidenced by participation from 38
investors, including 20 new investors to Tricon, and an order book
that was 4.5 times subscribed," said Gary
Berman, President and CEO of Tricon. "Following this
transaction, which will refinance the debt on over 3,300 of our
wholly-owned homes, Tricon will have meaningfully improved its
consolidated debt profile by reducing the average effective
interest rate by 20 bps to approximately 3.2% currently, and
extending the weighted-average maturity by 4 months, to 3.8
years."
The offering of certificates is being made through Morgan
Stanley & Co. LLC as sole structuring agent, joint bookrunner,
and co-lead manager, BofA Securities, Inc. as joint bookrunner and
co-lead manager, Citigroup Global Markets Inc. as joint bookrunner
and co-lead manager, and Deutsche Bank Securities Inc. as joint
bookrunner and co-lead manager.
The various classes of offered certificates have been rated on a
preliminary basis by Moody's Investors Service and Morningstar
Credit Ratings.
About Tricon
Founded in 1988, Tricon is a rental housing company catering to
the middle-market demographic throughout the United States and Canada. We own and manage over 30,000
single-family rental homes and multi-family rental units through an
integrated, technology-enabled operating platform. More information
about Tricon is available at www.triconresidential.com.
Certain statements contained in this news release are
forward-looking statements and are provided for the purpose of
presenting information about management's current expectations and
plans relating to the future. Readers are cautioned that such
statements may not be appropriate for other purposes. These
forward-looking statements include the anticipated completion and
pricing of any securitization transaction, the availability or
anticipated use of any surplus transaction proceeds, and the
resultant impact on the Company's debt profile. Such statements are
subject to significant known and unknown risks, uncertainties and
other factors that may cause actual results or events to differ
materially from those expressed or implied by such statements and,
accordingly, should not be read as guarantees of future performance
or results and will not necessarily be accurate indications of
whether or not such results will be achieved. Factors
that could cause actual results to differ include Tricon's ability
to execute the securitization transaction upon terms acceptable to
the Company. Although management believes that it has a reasonable
basis for the expectations reflected in these forward-looking
statements, actual results may differ from those suggested by the
forward-looking statements for various reasons including but not
limited to the assumptions, risks and uncertainties described
above. These forward-looking statements reflect current
expectations of the Company as at the date of this news release and
speak only as at the date of this news release. The Company does
not undertake any obligation to publicly update or revise any
forward-looking statements except as may be required by applicable
law.
The certificates will not be registered under the United
States Securities Act of 1933, as amended, and may not be offered
or sold in the United States
absent registration or an applicable exemption from registration
requirements. The certificates will be offered and sold in
the United States in accordance
with Rule 144A. This press release shall not constitute an offer to
sell or the solicitation of any offer to buy nor shall there be any
sale of the certificates in any jurisdiction in which such offer,
solicitation or sale would be unlawful under the laws of such
jurisdiction.
SOURCE Tricon Residential Inc.