TRSSF - TerrAscend Closes $45.5 Million in Debt Financing
TerrAscend Corp . (CSE: TER) (OTCQX: TRSSF), along with its subsidiaries in New Jersey and Maryland, closed a $45.5 million debt financing agreement with commercial real estate lender Pelorus Equity Group .
Proceeds from the loan, which closed Tuesday, will support TerrAscend’s ongoing growth initiatives. The news comes as the multistate operator continues to shore up its investments .
“We are pleased to announce this nondilutive financing at attractive terms given the current market environment,” said Jason Wild, executive chairman of TerrAscend.
Under the accord, Pelorus issued a floating rate loan at a current interest rate of 12.77%, based on a prevailing secured overnight financing rate (SOFR), with a 2.5% SOFR floor. The duration of the loan is 60 months, with a minimum earned interest period of 36 months.
The loan is secured by the TerrAscend real estate assets in New Jersey and Maryland.
“With this agreement, we are excited to help fuel TerrAscend’s growth and long-term business goals,” said Dan Leimal, CEO of Pelorus Equity Group and manager of the Pelorus Fund. “As the demand for capital continues to increase in tandem with the growth of the cannabis industry, we plan to deliver even more innovative, flexible lending solutions and stabilized loans like this one to meet the needs of a wide range of clients, including MSOs, SSOs and ancillary businesses.”
Pelorus said it has completed 72 commercial real estate loan transactions and issued more $500 million to cannabis businesses and real estate owners, comprising 4 million square feet in 10 states across the country.
The financier touts that it can approve construction draws to reimburse borrowers in an average of 1-3 days, with only single agreement usually needed in order to cover the financing of the entire project, Pelorus said.
“As the largest privately held commercial real estate lender in cannabis, we are seeing an increase in deals coming through our pipeline, and are strategically closing on them – even during this time of market volatility,” said Pelorus Equity Group managing partner Travis Goad. “With the longest history in the space of deploying capital successfully and seeing it returned, we spend a lot of time underwriting the company we’re working with, the real estate and the projections prior to making any loans.
“As more states come online and transition from medical to adult use, we remain excited about new opportunities in expanding markets like Maryland and New Jersey, and we are also closely following emerging markets like Alabama and Mississippi and will continue to look for strong sponsors, great projects and attractive markets,” he added.