Apollo Commercial Real Estate Finance Inc. (ARI) has completed the origination of a $26 million first mortgage secured by a full-service hotel in the greater Washington, D.C., area. The loan is a five-year fixed-rate loan with an interest rate of 9% amortizing on a 25-year schedule and represents an approximate loan-to-value ratio of 58%, the company says.
The company has also announced the purchase of additional AAA-rated commercial mortgage-backed securities (CMBS) totaling $104.7 million during March. The securities were financed through the Term Asset-Backed Securities Loan Facility (TALF) program on March 29, 2009, resulting in loan proceeds of $85.3 million and a net equity investment of $19.4 million.
The securities acquired are A2 tranches from four securitizations with a weighted average coupon of 5.6%. The TALF financing is three-year non-cross defaulted, nonrecourse and non-mark-to-market financing, with an interest rate of 2.72%, resulting in a levered current cash yield of approximately 17.9%.
To date, the ARI's portfolio comprises newly originated first mortgage loans totaling $86 million, newly originated mezzanine loans totaling $50 million, and CMBS totaling $371.7 million.
‘We are proud to announce that with the completion of these investments, ARI has fully deployed the equity capital raised in its initial public offering," says Stuart Rothstein, the company's chief financial officer. "ARI has a portfolio of investments that includes assets in each of its target asset classes, and expected returns are at or better than original projections.’