The company's annual interest expense is being reduced by over $1 million
Firm Capital has closed a mortgage refinancing totalling $38.2 million on its Pointe-Claire, Quebec-based multi-residential property, a move the company said would reduce annual interest expenses by around $1.3 million.
The new mortgage on the property, which is insured by Canada Mortgage and Housing Corporation (CMHC), is a 40-year amortization with a fixed interest rate of 3.69%, replacing the previous bridge mortgage with a 7.02% effective interest rate.
That deal means Firm Capital has now refinanced each of its 2023 maturities with the exception of one mortgage, valued at $2.4 million. The company said in a release accompanying the news that its focus was on maintaining a strong balance sheet, with a “conservative” 52% debt to gross book value and $15.5 million available in revolving credit facilities.
Five unencumbered properties are also in the company’s possession to address further capital requirements if the need should arise, it said, with that financial flexibility “provid[ing] the Trust with significant liquidity to fund its operations and capital programs without needing to raise additional equity.”
Around $60 million in mortgages refinanced on the company’s industrial properties at the end of 2022 and beginning of this year, meanwhile, have seven-year terms with maturity scheduled for 2029 and 2030.
