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mREIT Redwood Trust to Sell New Baby Bonds

Mortgage REIT Redwood Trust (RWT) has announced they will be selling a new issue of senior notes with a maturity date in 2029.

The notes will have an early redemption available in 2026 at the option of the issuer.

The issue will trade under ticker RWTN when they finally begin to trade on the NYSE.

Yield talk is in the 9.125% area.

The preliminary prospectus can be read here.

The company has a 10% fixed rate reset preferred trading now which is in the $24.55/share area

Thanks to EarlyBird for catching this one.

10 thoughts on “mREIT Redwood Trust to Sell New Baby Bonds”

  1. This is the change in control provision for the RWT notes. There is a similar provision in the recent MFA note prospectus. RWT preferred have slightly different language as it is as the unitholders option. The MFA B have a provision that leaves it at the comany option.

    Interested in any feedback on these two in comparison to other issues?

    “If a Change of Control Repurchase Event as defined under “Description of the Notes — Offer to Repurchase Upon a Change of Control Repurchase Event” occurs, we must offer to repurchase the notes at a purchase price equal to 101% of the principal amount plus accrued and unpaid interest to, but excluding, the repurchase date. See “Description of the Notes — Offer to Repurchase Upon a Change of Control Repurchase Event” in this prospectus supplement.”

    This is a change in control provision in the RWT preferred issue:

    “Upon the occurrence of a Change of Control, each holder of Series A Preferred Stock will have the right (unless, prior to the Change of Control Conversion Date, we have provided or provide notice of our election to redeem the Series A Preferred Stock) to convert some or all of the Series A Preferred Stock held by such holder on the Change of Control Conversion Date into a number of shares of our common stock per share of Series A Preferred Stock to be converted equal to the lesser of”

  2. Home of the high rent district. George Lucas, Grateful Dead, jumbo is exactly right. Special business loans.
    Give you an idea. Google North Bay biz journal.

  3. FWIW I have a small position in the RWT A. I have been watching them on and off since the GFC.

    I like RWT as a non agency player. They have a good specialization in Jumbos and Business Purpose Loans.

  4. There has been so many of these BBs issued lately that my first step in screening them as a possible purchase is that they have to be IG rated by either/both Moodys/S&P. I just do not have the desire to dig deeper unless they at least fulfill that criteria.

    1. yeah I bought a number of them but staying away from the Redwood one for now

      I have followed the MREIT space and never heard of them til now

  5. I wouldn’t want to own the preferred if they are offering these baby bonds. Thats just me being conservative in the mREIT space, especially since its not top tier like AGNC or NLY.

    1. At 9.125 it would be a over 1.00 lower than RWT-A at current price. How much is it worth to have a maturity date? MFAN nearly as high as MFA-B with no upside.

  6. Lol. It feels like baby bonds are the new normal for MREITS.

    PMT, MFAN, now RWT. It makes sense, the market seems to be open for them.

    1. Mr Market/buyers demanding this structure. New issue/syndicate market remain in sick bay. Money talks & bs walks! LOL

      Deal is soft with shares available..priced at 9.125.

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