FUR Winthrop Realty Trust New (delisted)

Massachusetts-based real estate investment trust (REIT), Winthrop Realty Trust (FUR), recently obtained a first mortgage loan worth $40 million, bearing an interest rate at LIBOR plus 11.5% including a 0.50% LIBOR floor rate. The loan has one 12-month extension opportunity and will mature on November 15, 2014, subject to customary closing conditions.

The company secured the loan for 67 condominium units at Queensridge Towers in Las Vegas, Nevada. Concurrently, Winthrop Realty took a loan worth $25 million from KeyBank National Association for Queensridge. The KeyBank loan is secured by the Queensridge loan and bears an interest rate at LIBOR plus 4.0%.

Separately, Winthrop Realty announced the acquisition of a multifamily property for $17.5 million. The 284-unit property, located in Greensboro, North Carolina, is currently 96% leased.

Additionally, in order to expand its vintage housing portfolio, Winthrop Realty entered into an agreement with its joint venture partner in a vintage housing venture. Under the deal, the entities will construct a low-income housing tax-credit apartment community in Snohomish County, Washington. On completion of the fifth project for this venture, the community will consist of 204 units and will bring the number of properties under the venture to a total of 5,485 units.

Winthrop Realty engages in the ownership and management of real estate and real estate-related financial instruments such as CMBS, bonds, REIT preferred and common stock. The company reported a FFO (funds from operations) of 58 cents a share in the third quarter of 2012, substantially beating the Zacks Consensus Estimate of 31 cents. As of September 30, 2012, the company had cash and cash equivalent worth $159.3 million and $353.5 million of total debt outstanding.

Winthrop Realty carries a short-term Zacks #3 Rank (Hold). Also, we have long-term Neutral recommendation on the stock. One of its competitors, Brandywine Realty Trust (BDN), carries a short-term Zacks #2 Rank (Buy).

Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

 
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