Timbercreek Senior Mortgage Investment Corporation (TSX:MTG)

Transcription

1 Timbercreek Senior Mortgage Investment Corporation (TSX:MTG)

2 FORWARD LOOKING STATEMENT Certain statements in this presentation about Timbercreek Senior Mortgage Investment Corporation (the Corporation ) and its business operations and strategy, and financial performance and condition may constitute forward-looking information, future oriented financial information, or financial outlooks (collectively, forward-looking information ). The forward-looking information is stated as of the date of this presentation and is based on estimates and assumptions made by the management of the Corporation in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management of the Corporation believes are appropriate and reasonable in the circumstances. There can be no assurance that such forward-looking information will prove to be accurate, as actual results, performance and future events could differ materially from those anticipated in such statements. TIMBERCREEK ASSET MANAGEMENT 2

3 AGENDA Update on Market Fundamentals Timbercreek Investment Strategies & Positioning Snapshot of Current Portfolio Q&A Session TIMBERCREEK ASSET MANAGEMENT 3

4 COMPANY OVERVIEW Targeting a well-diversified portfolio of customized first mortgage loans that: are secured by investment-grade real estate across Canada; primarily incomeproducing assets are customized to meet borrower s needs; i.e. fast turnaround time for funding, shorter terms, interest only payments have shorter durations which provide protection in a rising interest-rate environment The Company is focused on: 1. Preservation of capital -Stable NRV ( NAV ) zero loan losses 2. Generating stable cash flow for monthly distributions -Distributions that will increase in a rising interest rate environment TIMBERCREEK ASSET MANAGEMENT 4

5 MARKET FUNDAMENTALS Valuations remain stable valuations continue to hold stable for income producing assets and/or assets in desirable Tier 1 markets due to: moderate growth in rental rates no material increases in real estate supply continued demand for investment real estate Demand for customized mortgages is healthy ongoing lack of capital available from institutions real estate transaction activity is strong rising interest rates that are tied to inflation generally encourage more real estate activity Total amount of available debt remains steady a number of private mortgage managers have moved to public markets to improve reporting and liquidity for investors despite that, the total capital targeting mortgage investments remains stable TIMBERCREEK ASSET MANAGEMENT 5

6 TIMBERCREEK S INVESTMENT STRATEGIES Focus on income-producing properties monthly income is available to service loans if required income-producing properties offer greater price stability and therefore protect against volatility Focus on low loan-to-value mortgages provide sufficient equity cushion in the event of a real estate market correction Focus on shorter duration loans portfolio turnover is strong with YTD loan repayments of $161 Million, representing 41% of the portfolio as loans are re-paid, new loans are originated with interest rates that reflect the current interest rate environment TIMBERCREEK ASSET MANAGEMENT 6

7 TIMBERCREEK S KEY SUCCESS FACTORS Extensive Real Estate Experience: Timbercreek has over 13 years of real estate investment experience, has built a full service asset management platform with an active management philosophy and therefore has a deep understanding of the trends, opportunities and risks of the mortgage investments and the underlying real estate assets. Alignment of Interest: Timbercreek and its originators do not participate in lender fee revenue. Timbercreek remits to the Company all lender fees, contributing to the yield generated by the Company. Strong Governance: The Company s board of directors are majority independent members. Timbercreek also has an independent Mortgage Advisory Committee that reviews and approves all mortgage investment opportunities. Portfolio Diversification: In order to prevent concentration risk, the Company enforces a well-defined asset allocation policy designed to ensure diversification by geography, economic sector, asset class, term, borrower and loan-to-value. TIMBERCREEK ASSET MANAGEMENT 7

8 Timbercreek Senior Mortgage Investment Corporation

9 DELIVERY ON OBJECTIVES Preservation of Capital $12.00 $11.00 $10.00 $9.00 $8.00 $7.00 NAV Stable Distributions 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% LTM Class A Distributions * Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 * Yield is presented as a percentage of the original $10 issue. MTG Monthly Yield Annualized GOC 2 Year Bond Yield MTG Long Term Targeted Yield TIMBERCREEK ASSET MANAGEMENT 9

10 PORTFOLIO SUMMARY 1 BY PROPERTY TYPE BY REGION BY LOAN-TO-VALUE Other- Residential 8.0% Unimproved Land 4.0% Hotel 5.0% Industrial 6.0% Single- Residential 1.0% Multi- Residential 40.0% NB, 1.0% OT, 1.0% BC, 6.0% AB, 8.0% QC, 18.0% SK, 1.0% 61% - 65%, 43.0% 66% - 70%, 2.0% Less than 55%, 41.0% Retirement 10.0% Office 12.0% Retail 14.0% ON, 65.0% 56% - 60%, 14.0% 1 As a Percentage of Total Funded Loans based on fair value (being outstanding principal). Approximate percentage. TIMBERCREEK ASSET MANAGEMENT 10

11 PORTFOLIO SUMMARY 1 Portfolio Summary Total Portfolio $393 Million Total Mortgages Outstanding 54 Average Size of Mortgage Assets $7.2 Million Average Loan-to-Value 46.53% Average Interest Rate 6.76% Average Lender Fee 1.01% Average Remaining Term 21 months 1 As a Percentage of Total Funded Loans based on fair value (being outstanding principal). Approximate percentage. TIMBERCREEK ASSET MANAGEMENT 11

12 TOP 10 HOLDINGS Outstanding Principal Loan to Value * Interest Rate Allocation Product Type Ottawa Apartment Portfolio $27,495,000 65% 5.75% Multi-Residential EM Portfolio $24,084,791 50% 7.00% Multi-Residential Montreal Apartments $23,340,000 65% 7.25% Multi-Residential GTA Apartment Portfolio* $22,078,982 38% 4.29% Multi-Residential/Office Traditions Retirement $21,320,000 65% 6.54% Retirement AB Apartment Portfolio* $19,376,500 65% 5.50% Multi-Residential BGV Office Building $18,410,525 46% 6.50% Office King Street West* $16,000,000 22% 7.75% Other-Residential/Retail Legacy Industrial $14,300,000 64% 5.75% Industrial Ontario Residential $13,783,861 30% 7.75% Other-Residential * Mortgage-Loan has been cross collateralized across multiple assets TIMBERCREEK ASSET MANAGEMENT 12

13 Q&A Session 13

14 For more information on how to invest, please contact: Andrew Jones Managing Director, Debt Investments Carrie Morris, MBA Managing Director, Capital Markets & Corporate Communications