ACRES Commercial Realty Corp. 8 (ACR-C)

Overview

ACRES Commercial Realty Corp. is a real estate investment trust (REIT) dedicated to the origination, holding, and management of commercial real estate mortgage loans and other related debt investments in the United States. The organization specializes in commercial real estate-related assets and aims to provide investors with a robust portfolio of income-generating properties. By operating as a REIT, ACRES Commercial Realty Corp. benefits from certain tax advantages, notably its exemption from federal corporate income taxes, provided it distributes at least 90% of its taxable income to its stockholders. This structure is designed to enhance the returns on investment for its shareholders. Originally known as Exantas Capital Corp., the company underwent a rebranding in February 2021 to better reflect its refined focus and expanded capabilities in the commercial realty market. Established in 2005 and headquartered in Uniondale, New York, ACRES Commercial Realty Corp. has solidified its presence in the real estate sector through strategic investment and management of commercial properties.

Products and Services

• Floating and Fixed Rate First Mortgage Loans

ACRES Commercial Realty Corp. offers both floating and fixed-rate financing options to borrowers securing first mortgage loans. These loans are typically the primary lien on a property, providing borrowers with the capital needed for purchasing or refurbishing commercial real estate while offering investors stable returns.

• First Priority Interests in First Mortgage Loans

ACRES invests in first priority interests, ensuring they have a preferential claim on the assets and cash flow generated by the financed properties. This positions ACRES at the top of the repayment hierarchy should any financial restructuring occur.

• Subordinated Interests in First Mortgage Loans

The company also engages in subordinated interests in first mortgage loans, accepting a lower priority in the repayment structure in exchange for potentially higher returns. This investment strategy diversifies the portfolio risk.

• Mezzanine Debt

ACRES provides mezzanine financing, a hybrid of debt and equity financing that gives the lender the rights to convert to an equity interest in the case of default, after senior lenders are paid. Mezzanine debt generally offers higher returns due to its increased risk.

• Preferred Equity Investments

This investment strategy involves ACRES taking a preferred equity stake in companies or projects, offering capital that sits between debt and common equity in the capital structure. This position often provides fixed or floating returns and bolsters the company's investment diversity.

• Commercial Mortgage-Backed Securities

ACRES invests in commercial mortgage-backed securities (CMBS), which are types of secured bonds backed by mortgages on commercial properties. CMBS allow investors to invest in a diversified and professionally managed portfolio of commercial real estate assets.

• Commercial Real Estate Equity and Preferred Equity Investments

The company engages in direct equity and preferred equity investments in commercial real estate, offering the potential for growth and income through property value appreciation and rents. These investments expand the company's asset base and revenue potential.