Terra Income Fund 6 (not exchange traded) has sold a new issue of $25 baby bonds.
The notes, which mature in 2026, are priced with a coupon of 7%.
The issue is fairly small as the company is small with just $76 million in assets (prior to this offering on 9/30/2020). The company was near debt free as of 9/30/2020.
Terra Income Fund 6 is a specialty finance company, organized as a REIT, which participates in loans made for commercial real estate.
I am not familiar with the company at all and I would suggest deep due diligence by investors prior to investing.
The issue is rated BBB by Egan Jones. The permanent ticker will be TFSA–there will be no OTC grey market trading.
The pricing term sheet can be read here.
The more detailed registration form can be read here.
My suggestion is check out the funds as well as the bond, if you are inclined to invest.
My personal policy is not to invest in the preferred or debt of a fund if I don’t like the underlying fund. The Terra Capital Funds, to my eye, are awful. TC6 has a 7% load and a 7% annual fee (no leverage expense included). For what is in essence a commercial m-REIT? Yikes.
The fund itself is non traded (surprise) and is a classical case of a fund that is “sold” not bought. Most, I would think, is placed in accounts by full service brokers (meaning full fee brokers) that have discretion over the account.
Check out:
https://www.amazon.com/Where-Are-Customers-Yachts-Street/dp/0471770892/ref=sr_1_1?dchild=1&keywords=customers+yachts&qid=1612565164&sr=8-1
The company is Terra Capital Partners; it seems they have
individual “funds” comprised of a handful of property loans.
They indicate being in business since 2004.
Seems they do call it a “company”. also have a Fund 5.
Also Fund 7.
Sep 10Q shows 9 mos ending SEP2020 operating income was only a little over 20% of the 9 mos 2019. Commercial lending down a little, go figure.
Total of 8 investments! ~ $65million, only one in NY & NC, 6 in CA.