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The Corporation’s business consists in the lending of money, principally to individuals, for the purpose of acquiring, developing, maintaining or upgrading primarily residential real estate, against the security of a mortgage granted on such property. The purchase of a single security, namely, the Preferred Shares, allows an investor to diversify risk and participate with other investors in an entity holding a variety of mortgages.
The Manager works closely with retail mortgage brokers throughout Ontario in order to market the Corporation as a lender of choice in the non-conventional mortgage market segment. In this manner, the Corporation expects to be well positioned to receive referrals on mortgage lending opportunities that do not meet the criteria of the major lending institutions. As a result, the Corporation’s investments in non-conventional mortgages are expected to earn a higher rate of interest than what is generally obtainable through usual mortgage lending activities. The Corporation, through the Manager, will invest primarily in residential first mortgages, which may also include construction financing on residential property (residential properties are defined as one to four unit dwellings). While the majority of the investments will be in residential first mortgages, the Corporation may also identify opportunities in second mortgage loans as well as commercial mortgages (i.e. mortgages that are principally secured by multi-family housing projects, residential land developments, mixed-use properties and income-producing properties that have retail, commercial, service, office and/or industrial uses). Commercial loans will not exceed 20% of the total loan portfolio of the Corporation.
The Corporation’s objective is to generate income while preserving, for its shareholders, capital for reinvestment. The Corporation makes loans which do not generally meet the underwriting criteria of conventional lenders.
As a result, the mortgages held by the Corporation are expected to earn a higher rate of interest than what is generally obtainable through conventional mortgage lending activities. Unlike mortgage mutual funds, the Corporation engages in direct mortgage lending activities and generally does not acquire mortgages, or fractional interests in mortgages, in the secondary market. Also, unlike many mortgage mutual funds, the Corporation does not use derivatives.
The Corporation intends to pay out as dividends substantially all of its net income and net realized capital gains every year and, in that regard, it targets certain annualized yields. Amounts for dividend distributions will not be paid from the proceeds of the Offering. The Corporation intends to declare quarterly dividends to holders of Preferred Shares of record on the last business day of each quarter and to pay such dividends on or before the last business day of the following month.
Disclaimer
Certain statements herein, as they relate to Abbey Ridge Mortgage Investment Corporation (the “Corporation”) and its respective views or predictions about possible events, conditions or results of operations that are based on assumptions about future eco mnomic conditions and courses of action and includes future-oriented financial information with respect to prospective results of operations, financial position or cash flows that is presented either as a forecast or projection, are “forward-looking statements” within the meaning of that phrase under applicable Canadian securities laws.
Although the Corporation believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. Forward-looking statements are based on the current expectations, estimates and projections of the Corporation, and involve a number of known and unknown risks and uncertainties which could cause actual results or events to differ materially from those presently anticipated, including those risks described in the accompanying offering memorandum under “Item 8 – Risk Factors”.
The forward-looking statements herein are made as of the date hereof. Except as otherwise required by law, the Corporation does not intend to, and assumes no obligation to, update or revise these or other forward-looking statements it may provide, whether as a result of new information, plans or events or otherwise. Investors are cautioned not to place undue reliance on these forward-looking statements as there can be no assurance that the conditions, events, plans and assumptions on which they are based will occur.
The contents of this website should be read in conjunction with the offering memorandum of Abbey Ridge Mortgage Investment Corporation dated July 15, 2021, a copy of which is accessible in the Investors Strategy Section of this website.