ATLANTA, June 25, 2013 /PRNewswire/ -- Preferred Apartment Communities, Inc. (NYSE MKT: APTS) ("PAC" or the "Company") today announced its acquisition of a 96-unit townhome community located in Hampton, Virginia ("Trail II") adjacent to the Company's 204-unit Trail Creek community ("Trail I") for a purchase price of approximately $18.1 million. Trail II was completed in 2012 and has a current occupancy of approximately 94%. PAC intends to combine Trail II with Trail I and operate the combined properties as "Trail Creek" and brand it as "a Preferred Apartment Community." PAC acquired Trail II pursuant to the terms of the purchase option that was executed when PAC made a mezzanine loan investment to partially finance the construction of Trail II. In connection with the acquisition, PAC's mezzanine loan was paid in full, including the payment of approximately $283,000 in an accrued exit fee. We expect the expanded Trail Creek community will be a solid contributor to the continued dynamic growth of the Company.
Upon the acquisition of Trail II, PAC refinanced Trail I with a combined loan of approximately $28.1 million on the combined Trail Creek community originated by KeyCorp Real Estate Capital Markets, Inc., and expects the loan to be transferred to Freddie Mac within 60 days. The new financing is non-recourse, interest only at a fixed interest rate of 4.22% per annum, and matures in June 2020. There are no loan guaranties provided by PAC. The new loan replaces floating rate debt currently used to finance Trail I.
About Preferred Apartment Communities, Inc.
Preferred Apartment Communities, Inc. is a Maryland corporation formed primarily to acquire and operate multifamily properties in select targeted markets throughout the United States.
As a secondary strategy, we also may acquire or originate senior mortgage loans, subordinate loans or mezzanine debt secured by interests in multifamily properties, membership or partnership interests in multifamily properties and other multifamily related assets and invest not more than 10% of our total assets in other real estate related investments, as determined by our manager as appropriate for us. Preferred Apartment Communities, Inc. has elected to be taxed as a real estate investment trust under the Internal Revenue Code of 1986, as amended, commencing with its tax year ended December 31, 2011.
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. As a general matter, forward-looking statements reflect our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. These statements may be identified by the use of forward-looking terminology such as "may", "will", "expects", "plans", "estimates", "anticipates", "projects", "intends", "believes", "outlook" and similar expressions.
The forward-looking statements contained in this press release are based upon our historical performance, current plans, estimates, expectations and other factors we believe are appropriate under the circumstances. The inclusion of this forward-looking information is inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: Our business and investment strategy; our projected operating results; estimates relating to our ability to make distributions to our stockholders in the future; availability of qualified personnel; local and national market conditions and trends in our industry; demand for and lease-up of apartment homes, supply of competitive housing product, and other economic conditions; availability of debt and/or equity financing and availability on favorable terms; changes in our asset values; our ability to maintain our qualification as a REIT for U.S. federal income tax purposes; and economic trends and economic recoveries.
Additional discussions of risks, uncertainties and certain other important information appear in our publicly available filings made and to be made with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2012, which we filed with the SEC on March 15, 2013 and our Quarterly Report on Form 10-Q filed with the SEC on May 15, 2013, all under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." All information in this release is as of June 25, 2013. The Company does not undertake a duty to update forward-looking statements, including its projected operating results. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company may, in its discretion, provide information in future public announcements regarding its outlook that may be of interest to the investment community.
SOURCE Preferred Apartment Communities, Inc.