Aimco Announces: The realization of $100M of value creation from the successful development of four properties leased from AIR Communities; the cancellation of the related $469M lease obligation; and the repayment of $534M debt owed to AIR.
Apartment Investment and Management Company (AIV) has reached agreements with AIR Communities, creating over $100 million in realized value for shareholders. This deal will eliminate a $469 million lease obligation and facilitate the repayment of nearly $1 billion in debt. Aimco will receive $200 million for lease cancellations, with a profit of approximately $100 million expected to be realized sooner than planned. The company will also repay $400 million of notes from AIR by June, further reducing near-term refinancing risks.
- Creation of over $100 million in realized value for shareholders.
- Elimination of a $469 million lease obligation.
- Facilitates repayment of nearly $1 billion in debt.
- Aimco to receive $200 million for lease cancellations.
- Profit of approximately $100 million expected sooner than planned.
- Repayment of $400 million of notes from AIR reduces refinancing risks.
- None.
Following the successful development and lease-up of 707 Leahy in
As previously announced, Aimco and AIR have agreed on the early repayment of the
Following repayment of the AIR note and collapse of the four property leases, nearly all of Aimco’s property debt financing will be in the form of long-dated, non-recourse, fixed-rate loans, floating-rate construction loans with interest rate caps, and fixed rate long-term land and property leases.
In addition, Aimco will acquire from AIR for
Aimco and AIR have also agreed to continue their strategic relationship with AIR providing property management services to Aimco and the companies working together to identify future development opportunities where Aimco provides particular expertise. As such, Aimco and AIR have agreed to an amended Master Leasing Agreement (“MLA”).
Notably, under agreed amendments to the MLA, AIR’s purchase option to acquire completed development and redevelopment properties has been replaced with an AIR right of first offer (“ROFO”) on development and redevelopment assets that Aimco chooses to bring to market within one year following stabilization. These changes reflect the companies’ shared commitment to work together in a spirit of collaboration while allowing each the freedom to execute on their respective business plans.
In accordance with Aimco policy, each of these agreements and transactions was reviewed in detail and approved by a committee comprised entirely of independent directors.
Additional details can be found in the SEC Form 8-K filed by Aimco on
Forward-Looking Statements
This document contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include all statements that are not historical statements of fact and those regarding our intent, belief, or expectations, including, but not limited to, the statements in this document regarding our 2022 plans and goals, including our 2022 pipeline investments and projects, and our plans to eliminate certain near-term debt maturities. We caution investors not to place undue reliance on any such forward-looking statements.
Words such as “anticipate(s),” “expect(s),” “intend(s),” “plan(s),” “believe(s),” “may,” “will,” “would,” “could,” “should,” “seek(s)” and similar expressions, or the negative of these terms, are intended to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of Aimco that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statement. Important factors, among others, that may affect actual results or outcomes include, but are not limited to: (i) the risk that the 2022 plans and goals may not be completed, as expected, in a timely manner or at all, (ii) the inability to recognize the anticipated benefits of the pipeline investments and projects, and (iii) changes in general economic conditions, including, increases in interest rates and as a result of the COVID-19 pandemic. Although we believe that the assumptions underlying the forward-looking statements are reasonable, we can give no assurance that our expectations will be attained.
Readers should carefully review Aimco’s financial statements and the notes thereto, as well as the section entitled “Risk Factors” in Item 1A of Aimco’s Annual Report on Form 10-K for the year ended
These forward-looking statements reflect management’s judgment and expectations as of this date, and Aimco assumes no (and disclaims any) obligation to revise or update them to reflect future events or circumstances.
About Aimco
Aimco is a diversified real estate company primarily focused on value add, opportunistic, and alternative investments, targeting the
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Sr. Director of Capital Markets and Investor Relations
investor@aimco.com
303-793-4661
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