Trez Capital Mortgage Investment Corporation (“Trez Capital MIC”) was formed in 2012 to provide investors with the opportunity to generate an attractive and stable return by participating in a diversified portfolio of mortgages via a publicly traded vehicle.

Trez Capital MIC has two key objectives:

  1. To preserve capital while generating an attractive return in order to pay distributions to shareholders;
  2. Provide an annual distribution of 7.0% per annum, paid monthly (based on the $10 issue price).

Trez Capital MIC will achieve these objectives by taking advantage of an underserviced niche market that requires short-term, flexible mortgages that are tailored to the needs of the borrower. As a result of the under-servicing of this market we can provide mortgages on high-quality properties at attractive pricing.

Trez Capital MIC is managed by Trez Capital, one of the largest non-bank real estate lenders in Canada with more than 18 years of experience. They have invested on behalf of some of Canada’s largest pension funds and institutional investors, originating over 1,010 loans totaling $4.9 billion since inception. Today, they have approximately $2.0 billion in assets under administration.

Manager

Trez Capital Fund Management Limited Partnership

Investment Objective

To acquire and maintain a diversified portfolio of mortgages that preserves capital and generates attractive returns in order to permit the Company to pay monthly distributions to its shareholders.

Investment Strategy

To achieve its investment objectives through prudent investments in mortgages to qualified real estate investors and developers, focusing primarily on short-term bridge financing needs not currently serviced by traditional real estate lenders. Mortgages will be secured primarily by income producing real property where the principal and interest can be serviced from cash flow generated by the underlying real property.

The manager believes that its key lending practices and advantages in this market include its: (i) flexible structuring capability, (ii) speed of approval and funding, and (iii) certainty of execution, all of which lead to repeat business opportunities.

In general, the mortgages will generate income through a rate of interest, which is typically payable periodically throughout the terms of the mortgages, as well as commitment fees which generally are paid at the time of initial funding. All mortgages will be secured by real property consisting primarily of multi-family residential (generally not including single family residential), office, retail, industrial and other commercial property located across Canada. Mortgages may be either first ranking, a junior position in a first ranking mortgage, or a second ranking mortgage.

Credit Facility

The manager does not intend to use the credit facility to leverage the returns from the portfolio in order to achieve the targeted annualized yield to investors.

The Company may, from time to time at the discretion of the manager, borrow under the credit facility to

     
  1. facilitate its operating activities and fund working capital requirements, and
  2.  
  3. facilitate entering into mortgage loans or funding subsequent advances in an expedient manner.

The lender under the Credit Facility is a Canadian chartered bank that is at arm’s length to the Company and Trez. The terms, conditions, interest rate, fees and expenses of and under the Credit Facility are typical of credit facilities of this nature.

Monthly Distributions

The Company currently pays a dividend of $0.0583 per Class A Share per month ($0.70 per annum representing an annual cash distribution of 7.0% based on the $10.00 per Class A Share issue price). Dividends are expected to be taxed as interest income.

Management Fee

1.25% per annum of gross assets of the portfolio

Performance Fee

20% of the amount by which the net return for that year exceeds the product of:

     
  1. the average month-end NAVs during such year, and
  2.  
  3. the average of the two-year Government of Canada bond yield on  the last day of each calendar month during the year plus 450 basis points and prorated for any partial years.

Eligibility

Eligible for RRSPs, DPSPs, RRIFs, RESPs, RDSPs and TFSAs