Altisource Residential Corporation Announces Acquisition of Approximately 4,250 Single Family Rental Homes
30 Septembre 2016 - 8:57PM
Transaction more than Doubles Residential’s
Rental Portfolio
Altisource Residential Corporation ("Residential" or “the Company”)
(NYSE:RESI) today announced that it has acquired a portfolio of
4,262 single family rental properties for an aggregate purchase
price of $652.3 million in a seller financed transaction. The
assets were acquired from investment funds sponsored by Amherst
Holdings, LLC.
The transaction more than doubles the size of the
Company’s single family rental portfolio and greatly enhances
Residential’s presence in new and existing strategic target
markets, including Florida, Texas, Georgia, Tennessee, North
Carolina and South Carolina. The newly-acquired portfolio is
consistent with Residential’s existing portfolio of quality,
affordable rental homes and is targeted to meet the Company’s
return on equity objectives.
“Residential continues to successfully execute its
strategy to transition the Company into a 100% single-family rental
REIT and to capitalize on attractive single-family rental
economics,” said George Ellison, Chief Executive Officer of
Residential. “These high-yielding properties are an excellent fit
for the Residential brand and expand our geographic reach in
strategic markets. The acquisition of these properties is a
crucial milestone for Residential and keeps the Company on track to
achieve its stated goal of 10,000 rental homes by the end of
2016.”
“This is a transformative transaction for
Residential,” said David Reiner, Chairman of the Company’s Board of
Directors. “By continuing to execute on our strategy,
Residential is well positioned to reward investors with long-term
growth and attractive returns.”
The seller financing for this transaction
represented 75% of the purchase price and was provided pursuant to
a loan agreement with a term of up to five years and a floating
interest rate of one-month LIBOR plus a fixed spread. In connection
with the acquisition and as a condition to the seller financing,
Residential has engaged the current property manager for the
portfolio, Main Street Renewal, LLC, to provide property management
services with respect to the acquired properties. Altisource
Portfolio Solutions S.A. (“Altisource”) will continue to be
Residential’s property manager with respect to all of the Company’s
other REO and single family rental properties. Residential
obtained a waiver of the exclusivity provisions in its existing
Master Services Agreement with Altisource in order to complete the
portfolio acquisition. In consideration of this waiver, the parties
agreed to certain amendments to the Master Services Agreement,
including a contingent liquidation fee of $60 million in the event
Residential determines to liquidate 50% or more of its single
family rental portfolio managed by Altisource.
About Residential
Residential is focused on providing quality,
affordable rental homes to families throughout the United States.
Additional information is available at www.altisourceresi.com.
Forward-looking Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, regarding management's beliefs, estimates,
projections, anticipations and assumptions with respect to, among
other things, the Company's financial results, future operations,
business plans and investment strategies as well as industry and
market conditions. These statements may be identified by words such
as "anticipate," "intend," "expect," "may," "could," "should,"
"would," "plan," "estimate," "seek," "believe" and other
expressions or words of similar meaning. We caution that forward
looking statements are qualified by the existence of certain risks
and uncertainties that could cause actual results and events to
differ materially from what is contemplated by the forward-looking
statements. Factors that could cause the Company's actual results
to differ materially from these forward-looking statements may
include, without limitation, our ability to implement our business
strategy; our ability to make distributions to our stockholders;
the impact of changes to the supply of, value of and the returns on
sub-performing and non-performing loans and single-family rental
properties; our ability to successfully modify or otherwise resolve
sub-performing and non-performing loans; our ability to convert
loans to single-family rental properties and acquire single-family
rental properties generating attractive returns; our ability to
complete potential transactions in accordance with anticipated
terms and on a timely basis or at all; our ability to successfully
integrate the acquired properties into our portfolio of single
family rentals; our ability to successfully integrate Main Street
Renewal, LLC as an additional property manager; our ability to meet
our growth estimates or targets; our ability to predict costs;
difficulties in identifying sub-performing and non-performing loans
and single-family properties to acquire; our ability to effectively
compete with competitors; our ability to apply the net proceeds
from financings in target assets in a timely manner; changes in
interest rates and the market value of the collateral underlying
our sub-performing and non-performing loan portfolios or acquired
single-family properties; our ability to obtain and access
financing arrangements on favorable terms, or at all; our ability
to retain the exclusive engagement of Altisource Asset Management
Corporation; the failure of Altisource Portfolio Solutions S.A. to
effectively perform its obligations under various agreements with
us; the failure of our servicers to effectively perform their
servicing obligations under their servicing agreements with us; our
failure to qualify or maintain qualification as a REIT; our failure
to maintain our exemption from registration under the Investment
Company Act of 1940, as amended; the impact of adverse real estate,
mortgage or housing markets; and the impact of adverse legislative
or regulatory tax changes and other risks and uncertainties
detailed in the "Risk Factors" and other sections described from
time to time in the Company's current and future filings with the
Securities and Exchange Commission. In addition, financial risks
such as liquidity and credit risks could influence future results.
The foregoing list of factors should not be construed as
exhaustive.
The statements made in this press release are
current as of the date of this press release only. The Company
undertakes no obligation to publicly update or revise any
forward-looking statements or any other information contained
herein, whether as a result of new information, future events or
otherwise.
Robin N. Lowe
Chief Financial Officer
T: 1-345-815-9919
E: Robin.Lowe@AltisourceAMC.com
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