New York City-based Granite Point Mortgage Trust Inc. has closed an $826 million collateralized loan obligation which financed 25 existing GPMT first mortgage loan investments. The CLO has an initial advance rate of approximately 80% and a weighted average interest rate at issuance of LIBOR + 1.27%.
According to a prepared statement, proceeds from the CLO issuance were used to repay a portion of the outstanding balances on the company’s financing facilities and will also be used to fund new loan investments.
In the statement, Jack Taylor, CEO of Granite Point Mortgage Trust, said, “The closing of our inaugural $826 million CLO transaction is a major milestone for our Company and a significant additional step in executing our strategy of diversifying our financing sources and reducing our cost of funds. This transaction attractively finances about a third of our investment portfolio as of March 31, 2018, while providing matched-term, non-recourse and non-mark-to-market funding. It also allows us more flexibility as we continue to manage our balance sheet and provides us more capacity to grow.”
Wells Fargo Securities acted as sole structuring agent, co-lead manager and joint bookrunner. Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC acted as co-lead managers and joint bookrunners.
The company also recently revealed its Q1 results, which showed that the REIT generated a pipeline of senior floating rate commercial real estate loans, including upsizings, with total commitments of over $420 million, and initial funding loan amounts of over $370 million, which have either closed or are in the closing process, subject to fallout.