CALGARY, Alberta--(BUSINESS WIRE)--Walton Westphalia Development Corporation (the “Corporation”) announced today that the refinancing (the "Refinancing") of the Corporation's debt relating to the Westphalia project (the “Project”), has been completed. Capitalized terms used in this news release and not defined herein have the meanings given to them in the unaudited condensed interim consolidated financial statements of the Corporation for the three and nine months ended September 30, 2018.
The Refinancing included:
1. Fully funding the available principal amount under the New Loan Program, to the maximum of US$30,000,000. The New Loan Program matures in June 2021.
2. The Corporation obtaining a new, non-revolving, US$27,000,000 senior loan (the “Senior Loan”) from a Canadian-based financial institution. The initial advance of the Senior Loan funded the full repayment of the Mezzanine Loan as of November 30, 2018, paid for fees and transaction costs associated with the Senior Loan and provided working capital to the Project.
Future advances of the Senior Loan are available to fund monthly interest expenses owing under the Senior Loan and a contingency for additional development costs. Subject to meeting certain conditions tied to the remaining cost to complete Phase 1 of the Project, additional amounts may be available under the Senior Loan for repaying other debt of the Project outstanding at a higher interest rate.
The Senior Loan has a maturity date of November 30, 2019 (12 months from the date of advance) and is expected to be repaid within the term of the loan by contracted lot and land sales, including townhome lots in Phase 1 and the bulk sale of the Phase 1A lands.
In conjunction with the proceeds of the tax increment financing (TIF) bonds issued by Prince George’s County Maryland for public infrastructure projects in and around Westphalia Town Center, the Refinancing allows the Corporation to execute on its plan of developing Phase 1 of the Project and unlocking the potential of Westphalia Town Center.
The Corporation’s President, CEO, and Chairman Bill Doherty said, “The refinancing removes barriers to the Corporation continuing as a going concern by providing extended loan maturities and working capital, allowing the Project to continue with its development plan. I would like to thank our old and new financial partners for their support of the Westphalia Town Center project.”
Currently the Corporation is delivering residential townhome lots to three homebuilders, recruiting retail tenants, and evaluating offers from multiple partners for various uses in future phases of the Corporation’s Project in Prince George’s County, Maryland.
The Corporation is managed by Walton Global Investment Ltd. and the development of the Project is managed by Walton Development & Management (USA), Inc., both of which are members of the Walton Group of Companies.
The Walton Group of Companies (“Walton”) is a multinational real estate investment, planning, and development group concentrating on the research, acquisition, administration, planning and development of strategically located land in major North American growth corridors. Walton’s communities are comprehensively designed in collaboration with local residents for the benefit of community stakeholders. Its goal is to build communities that will stand the test of time: hometowns for present and future generations.
This news release, required by Canadian laws, does not constitute an offer of securities, and is not for distribution or dissemination outside Canada. This news release contains forward looking information, and actual future results may differ from what is disclosed in this news release. Forward-looking information is based on the current expectations, estimates and projections of the Corporation at the time the statements are made. They involve a number of known and unknown risks and uncertainties which would cause actual results or events to differ materially from those presently anticipated. The risks, uncertainties and other factors that could cause the Corporation's actual results and performance in future periods to differ materially from the forward looking information contained in this news release include, among other things, renegotiation of loans, refinancing or extension of existing loans, the amount and timing of the financing received, the amount of, timing and terms of any tax increment financing that has been received or may be received by the Corporation, the length of time it takes to develop and sell the Project, the ability of the Corporation to enter into joint ventures relating to, or to otherwise, vertically develop portions of the Project, the availability of future advances under the Senior Loan, the use of such advances by the Corporation and the benefits thereof, the ability of the Corporation to repay funds advanced to it under the Senior Loan, the ability of the Corporation to develop Phase 1 of the Project and the timing thereof, the Corporation continuing as a going concern, the ability of the Corporation to repay its outstanding debts within expected timelines, the availability and terms of other construction financing required by the Corporation, the costs involved in the horizontal and/or vertical development of the Project, the prices at which the serviced lots and parcels from, or vertically developed structures on, the Project can be sold, the rate at which serviced lots and parcels from, or vertically developed structures on, the Project are purchased in the marketplace, general economic and market factors, including interest rates, a decline in the real estate market, changes in government policies and regulations or in tax laws, changes in municipal planning strategies and whether certain development approvals are obtained and changes in the Canadian/U.S. dollar exchange rate, in addition to those factors discussed or referenced in the prospectus and other documents filed with Canadian securities regulatory authorities and available online at www.sedar.com.