The Trust has secured an 8-year loan with a fixed interest rate of 5.6%. Prepayment is prohibited during the first 12 months and requires yield maintenance thereafter until near loan maturity.
Leverage profile
All-cash offering — no mortgage debt, so there is no leverage to chart.
Loan Amount
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Term
8 years
Interest Rate
5.6%
Fixed / Variable
Fixed
Prepayment Penalty
The Loan will be closed to prepayment during the first 12 months of its term. Should the Trust prepay the Loan following this period, the Trust will pay a yield maintenance fee equal to the greater of (1) an adjusted yield of an equivalent-maturity U.S. Treasury bond plus 50 basis points and (2) 1% of the outstanding principal balance of the Loan. Toward the end of the Loan's term, this prepayment fee will terminate.
DSCR
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Acquisition LTV
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Offering LTV
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Strengths
- Fixed interest rate of 5.6%
- 8-year loan term provides medium-term financing stability
Concerns
- 12-month initial prepayment lockout
- Yield maintenance penalty required post-lockout