SOURCE: Apollo Commercial Real Estate Finance, Inc.

Apollo Commercial Real Estate Finance, Inc.

March 29, 2011 16:02 ET

Apollo Commercial Real Estate Finance, Inc. Announces Additional Investment Activity

NEW YORK, NY--(Marketwire - March 29, 2011) - Apollo Commercial Real Estate Finance, Inc. (the "Company") (NYSE: ARI) announced the closing of a $47.5 million investment structured in the form of a repurchase facility secured by a Class A-2 CDO bond. The $47.5 million of borrowings provided under the facility will finance the purchase of a CDO bond with an aggregate face amount of $68.7 million, representing an advance rate of 69% on the CDO bond's face amount. The Class A-2 CDO bond, originally rated AAA/Aaa, is currently rated A-/Baa1. The CDO is comprised of 58 senior and subordinate commercial real estate debt positions and commercial real estate securities with the majority of the debt and securities underlying the CDO being first mortgages. 

The repurchase facility bears interest at 13.0% (10.0% current pay with a 3.0% accrual) on amounts outstanding and has an initial term of 18 months with three six-month extensions options available to the borrower. Any principal repayments that occur prior to the 21st month are subject to a make-whole provision at the full 13.0% interest rate. 

The first draw under the repurchase facility totaled $41.5 million and occurred on March 28, 2010. The Company expects the remaining $6.0 million to be drawn the first week of April 2011. 

Scott Weiner, Chief Investment Officer of the Company's Manager, commented, "We are pleased to announce the deployment of another $47.5 million of capital at a return of 13.0%. By analyzing the CDO collateral and creatively structuring a transaction to meet the needs of the Company and the borrower, we were able to make an investment which we believe provides a very attractive risk adjusted return." 

With the completion of this investment, the Company has deployed approximately $298.3 million of equity capital and has investments totaling approximately $853.2 million as well as approximately $50 million of additional capacity available under its repurchase agreement with JPMorgan Chase Bank N.A. 

To date, the Company's portfolio is comprised of the following investments:

  • Newly originated first mortgage loans totaling $118.4 million
  • Newly originated mezzanine loans totaling $59.0 million
  • Newly originated repurchase agreements totaling $41.5 million
  • Commercial mortgage-backed securities ("CMBS") totaling $634.3 million

About Apollo Commercial Real Estate Finance, Inc.
Apollo Commercial Real Estate Finance, Inc. (NYSE: ARI) is a commercial real estate finance company that originates, invests in, acquires and manages senior performing commercial real estate mortgage loans, commercial mortgage-backed securities, and other commercial real estate-related debt investments in the U.S. The Company is externally managed and advised by ACREFI Management, LLC, a Delaware limited liability company, an indirect subsidiary of Apollo Global Management, LLC. Additional information can be found on the Company's website at www.apolloreit.com.

Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company's control. These forward-looking statements include information about possible or assumed future results of the Company's business, financial condition, liquidity, results of operations, plans and objectives. When used in this release, the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may" or similar expressions, are intended to identify forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: the return on equity; the yield on investments; the ability to borrow to finance assets; and risks associated with investing in real estate assets, including changes in business conditions and the general economy. For a further list and description of such risks and uncertainties, see the reports filed by the Company with the Securities and Exchange Commission. The forward-looking statements, and other risks, uncertainties and factors are based on the Company's beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.