MacarthurCook Investment Managers (Asia) Ltd was granted their first extension last March. It was a 60-day extension for its debt facility, amounting to $220.8 million, which would have matured in April. However, yesterday, their managers declared the implementation of conditions required for the extension of MI-REIT’s $202.3 million debt facility.
From $220.8 million, it was trimmed down to $202.3 million for the second extension permitted last May; the flipside of this was that it gained an interest margin of 5 percent per annum. Around 90 percent of the loan came from this debt facility, leaving the 10 percent based in Japan. The firm already started to refinance the 10 percent.
The reason for the extension was dependent on the documentation and satisfaction of particular standard circumstances. The investment managers affirmed that it was all under control of MI-REIT. However, MI-REIT took a rain check on the details of the circumstances when they were contacted yesterday.
It happens that MI-REIT was unable to pay even after second extension. This means that MI-REIT will be unable to acquire a property in the International Business Park.
According to the manager of MI-REIT, "The manager understands the settlement of the property is likely to occur late fourth calendar quarter 2009. The manager, together with its adviser, Standard Chartered Bank Ltd, is considering the most appropriate longer-term capital structure for MI-REIT inclusive of funding options for the property.”
March 31 ended MI-REIT’s fourth quarter. They experienced a 13.9 percent plunge in allocation to unit holders, loosing them $800,000 for the quarter.