MuniMae Completes $19.5 Million Tax-Exempt Bond Transaction Company Remains On Target with 1998 Expectations
BALTIMORE–(BUSINESS WIRE)–Aug. 31, 1998–Municipal Mortgage & Equity, L.L.C. (NYSE:MMA), also known as MuniMae, announced Monday the structuring of a $19.5 million tax-exempt mortgage revenue bond transaction secured by three cross collateralized properties in the Oklahoma City area.
MuniMae originates, invests in and services tax-exempt multifamily housing bonds.
MuniMae President and COO, Michael L. Falcone commented, “With this transaction, MuniMae has completed $204.6 million of investment transactions in 1998, more than doubling our investment activity in 1997. This transaction level has contributed to six consecutive increases in quarterly earnings and Cash Available for Distribution (“CAD”).
“We continue to be on target to achieve our 1998 goals and fully anticipate meeting our analysts’ CAD expectations for the year. At Friday’s closing share price of $18.50, MuniMae’s indicated annual dividend of $1.52 represents a yield of 8.2%, approximately 80% of which is exempt from Federal taxes.”
The 501(c)(3) bond was issued by the Oklahoma County Finance Authority. The 30-year bond has a 7.125% interest rate. MuniMae also made a $700,000 taxable loan with an interest rate of 8.5%. The bond and the loan are secured by three existing properties encompassing 772 units.
Parkwood Village, a 294 unit garden apartment community, and Eagle Pointe, a 286 unit garden apartment community, are both located in Midwest City, Okla. Lakeview Towers, a 192 unit, fifteen story apartment building, is located in Oklahoma City. MuniMae earned a 1.0% origination fee on the transaction and will retain the mortgage servicing rights.
Falcone added, “This investment continues the geographic diversification of our portfolio into two strong sub-markets. The combination of three cross collateralized properties, a strong local market, a growing 501(c)(3) borrower and an experienced management company make this a solid addition to our bond portfolio.”
The fifty-six multifamily housing communities which secure MuniMae’s portfolio are located in twenty-eight markets in fifteen states and contain 14,566 units with an average occupancy of 95%. The properties represent approximately $600 million in real estate value. Most of MuniMae’s assets provide for MuniMae to participate in the appreciation of the underlying apartments on a tax-exempt basis.
MuniMae is organized as a limited liability company which provides for tax advantages as well as the benefit of corporate governance. MuniMae, like Real Estate Investment Trusts (“REITs”), is exempt from tax at the corporate level.
In addition, the Company passes through to its shareholders primarily tax-exempt dividends which are generated by its municipal bond investments. Dividends to shareholders are declared and paid quarterly.
MUNIMAE: TAX-EXEMPT DIVIDENDS AND GROWTH THROUGH REAL ESTATE
This press release contains statements which are forward looking in nature and reflect management’s current views with respect to future events and financial performance. These statements are subject to many uncertainties and risks and should not be considered guarantees of future performance.
Actual results may vary materially from projected results based on a number of factors, including the actual performance of the properties pledged as collateral for the portfolio, general conditions in the local real estate markets in which the properties are located and prevailing interest rates.
CONTACT: Municipal Mortgage and Equity, L.L.C.
Derek K. Cole, director, Investor Relations,
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