Apollo real estate trust hits $1.4bn in transactions

Apollo Commercial Real Estate Finance (ARI) has committed to and funded over $1.4 billion of commercial real estate loans in 2016, the firm said on Monday.

The company’s investments were up and down the capital structure, and it also completed the acquisition of Apollo Residential Mortgage, which gave it $33 million of additional capital, according to the statement.

Scott Weiner, chief investment officer at ARI, said in a statement that the firm increased its floating-rate first mortgage investment activity in 2016, “as the increase in the Company’s capital base and funding sources enabled ARI to complete larger transactions.” Stuart Rothstein, chief executive officer and president of ARI, added that the firm’s investment portfolio surpassed the $3 billion by the end of the year.

“The recent capital raising activity coupled with the expansion of the company’s financing sources has positioned ARI to enter 2017 with dry powder for new investments and the company has built a robust pipeline,” Rothstein added.

The real estate investment trust completed $860.8 million in first mortgage loans, with a weighted average internal rate of return of approximately 16 percent and secured by office, mixed-use, data center, hospitality and retail properties in Chicago, Boston, Miami, New York City, Los Angeles and Northern Virginia.

On top of first mortgage transactions, ARI completed $430.3 million of subordinate loans, with a weighted average IRR of approximately 13 percent and backed by condominium development, hospitality and healthcare in New York City and London, and $140.1 million of deals for previously closed loans.

In December, the firm sold 10.5 million shares of stock to JPMorgan, Citigroup, Morgan Stanley and others for $117.9 million, according to a Securities and Exchange Commission filing.  

Through the merger, AMTG shareholders received shares of ARI common stock and $6.86 in cash for each share of AMTG common stock that they hold, the company said last February.

Due to the finalisation of the AMTG acquisition and the December stock sale, ARI ended the year with an equity capitalisation of approximately $2.0 billion.

The New York-based trust has $3.2 billion in assets as of 30 September 2016, according to its latest quarterly SEC filing. ARI is a subsidiary of the leading global alternative investment manager Apollo Global Management.