American Mortgage Acceptance Company Announces $109 Million of Investment Activity in 2005 and Strategy for 2006.
"AMAC had a successful year in 2005, with the Company's investment volume totaling approximately $109.2 million, an increase of 56.2% over its 2004 volume," commented Marc D. Schnitzer, President of AMAC. "Particularly noteworthy is the composition of our investment activity in 2005, which included several mezzanine loans on office and retail properties. This year was the first for AMAC in diversifying our investment activity beyond multifamily lending, demonstrating the breadth of our origination and acquisition platform. As we look to 2006, we expect that commercial lending will comprise a more significant portion of our investment activity."
2005 Investment Activity
Over the twelve months ended December 31, 2005, AMAC's investment activity included:
--Approximately $24.4 million of floating rate mezzanine loans, $21.2 million of which has been funded to date;
--Approximately $10.6 million of fixed rate mezzanine loans, $7.5 million of which has been funded to date;
--Approximately $7.5 million of first mortgage loans;
--A $5.0 million subordinated interest in a first mortgage loan; and
--$61.7 million of Fannie Mae Certificates.
With the changes to AMAC's trust agreement that were approved by AMAC's shareholders on June 8, 2005, AMAC's Board of Trustees recently approved an expansion of AMAC's investment strategy. Utilizing the resources of AMAC's advisor, CharterMac (NYSE:CHC), AMAC intends to originate and acquire first mortgage loans, subordinated interests in first mortgage loans and bridge loans, in addition to the traditional mezzanine loans that AMAC originates. CharterMac's mortgage banking division, CharterMac Mortgage Capital ("CMC"), has an origination platform that originated over $1.7 billion of first mortgage loans for third parties, including conduits, in 2005. AMAC aims to fund first mortgage loans and subordinated interests in first mortgage loans that CMC will originate, and then will securitize these loans and investments in a collateralized debt obligation ("CDO"). Capitalizing on the origination momentum that began in 2005, AMAC intends to originate and acquire loans that secure office properties, retail properties and industrial properties, in addition to multifamily properties.
"AMAC's ability to tap the CDO marketplace in 2006 will be key towards lowering the Company's cost of capital and making AMAC more competitive when originating loans," said Mr. Schnitzer. "We look forward to reporting on AMAC's progress towards vastly expanding the Company's origination efforts. We believe that this initiative will increase AMAC's return on equity and maximize shareholder value."
AMAC intends to issue its first CDO beginning in the second quarter of 2006, although there are no assurances that this transaction will occur.
About the Company
AMAC is a real estate investment trust that specializes in commercial real estate finance. AMAC originates and acquires mezzanine loans, bridge loans, and government-insured first mortgages secured by properties throughout the United States. For more information, please visit our website at http://www.americanmortgageco.com or contact the Shareholder Services Department directly at 800-831-4826.
Certain statements in this press release may constitute forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are detailed in AMAC's Annual Report on Form 10-K for the period ended December 31, 2004, and in its other filings with the Securities and Exchange Commission. Such forward-looking statements speak only as of the date of this press release. AMAC expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in AMAC's expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based.
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|Date:||Jan 12, 2006|
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