Loans Payable and Secured Line of Credit

6 Months Ended

Jun. 30, 2024

Loans Payable and Secured Line of Credit

Loans Payable and Secured Line of Credit

Note 8 – Loans Payable and Secured Line of Credit

Corporate Credit Facility

In December 2019, we entered into our Corporate Credit Facility, or CCF, a multiple draw credit agreement aggregating $70.0 million.  Prior to the Recapitalization Transactions, the CCF was scheduled to mature on December 19, 2024, subject to extensions until December 19, 2025 and June 19, 2026, respectively, under certain circumstances.

In connection with the Recapitalization Transactions, the Company entered into a Borrower Assignment and Assumption Agreement (the “Borrower Assignment and Assumption Agreement”), pursuant to which the Company assigned all of its rights, interests, duties, obligations and liabilities in, to and under the CCF, and each other document and instrument related to the CCF, to TPHGreenwich.  As of February 14, 2024, the CCF had an outstanding balance of $52.8 million, including approximately $11.3 million of accrued interest and excluding unamortized deferred finance fees of approximately $170,000.

In addition, in connection with the Recapitalization Transactions, TPHGreenwich entered into an amended and restated credit agreement, among TPHGreenwich, as borrower, certain subsidiaries of TPHGreenwich party thereto, as guarantors, the Company Investor, as lender and Mount Street US (Georgia) LLP (“Mount Street”), as administrative agent (the “Amended CCF”), pursuant to which the CCF was amended and restated in its entirety in order to, among other things, (i) release certain subsidiaries of the Company that were guarantors under the CCF from their guarantee obligations thereunder, (ii) extend the maturity date to June 30, 2026, and (iii) cause TPHGreenwich to incur an advance of $272,609.  The Amended CCF bears interest at a rate per annum equal to (i) an all PIK interest rate equal to 10.325% per annum, or (ii) at TPHGreenwich’s election, a cash pay interest rate of 4.875% per annum and a PIK interest rate of 5.45% per annum.  In connection with the Borrower Assignment and Assumption Agreement, the Company also entered into a holdco pledge agreement, pursuant to which the Company agreed to pledge all of its membership interests in TPHGreenwich to Mount Street.

Loans Payable

77G Mortgage Loan

In October 2021, TPHGreenwich Owner LLC, the subsidiary that owns 77 Greenwich (the “77G Mortgage Borrower”) entered into a loan agreement with Macquarie PF Inc., a part of Macquarie Capital, the advisory, capital markets and principal investment arm of Macquarie Group, as lender and administrative agent (the “77G Mortgage Lender”), pursuant to which 77G Mortgage Lender agreed to extend credit to Mortgage Borrower in the amount of up to $166.7 million, subject to the satisfaction of certain conditions (the “77G Mortgage Loan Agreement”).

In connection with the Recapitalization Transactions, the 77G Mortgage Borrower entered into a third amendment to the 77G Mortgage Loan Agreement with MPF Greenwich Lender LLC (as successor-in-interest to Macquarie PF Inc.), as lender, and certain entities affiliated with the Investor, as supplemental guarantors  (the “77G MLA Amendment”), which, among other things, provides that (i) the original building loan will be reduced to $125,347,878, (ii) an additional project loan will be made in the amount of $2,850,000, (iii) the completion date will be extended to December 31, 2024, (iv) the maturity date will be extended to October 23, 2025 with an option to extend for one year and (v) TPHGreenwich Mezz LLC, the direct parent entity of 77G Mortgage Borrower, will enter into a new pledge agreement pursuant to which it will pledge 100% of its membership interests in 77G Mortgage Borrower. The 77G MLA Amendment further provides that the existing Completion Guaranty and Interest and Carry Guaranty by the Company, as original guarantor, are terminated, and that the existing Recourse Guaranty and Environmental Indemnification Agreement by the Company, as original guarantor, are only in full force and effect with respect to matters arising prior to the execution of the 77G MLA Amendment.

As of February 14, 2024, the 77G Mortgage Loan had a balance of $98.0 million, which included $11.9 million in PIK interest.  Through February 14, 2024, the 77G Mortgage Loan was paid down by approximately $71.1 million through closed sales of residential condominium units. In connection with the Recapitalization Transactions, this loan was assigned to TPHGreenwich.

77G Mezzanine Loan

In December 2020, TPHGreenwich Subordinate Mezz LLC, a subsidiary of the Company (the “77G Mezz Borrower”) entered into a mezzanine loan agreement with an affiliate of the CCF Lender (the “77G Mezzanine Loan Agreement”).  

In connection with the Recapitalization Transactions, the 77G Mezz Borrower entered into a second amendment to the 77G Mezzanine Loan Agreement, which provides for, among other things, the (i) termination of the pledge by TPHGreenwich Mezz LLC of 100% of its membership interests in the 77G Mortgage Borrower, (ii) extension of the completion date to December 31, 2024, (iii) the extension of the maturity date to October 23, 2025 with an additional option to extend for 1 year, (iv) the increase of the principal amount of the 77G Mezzanine Loan to approximately $60.8 million, inclusive of accrued interest as of that date, and (v) termination of the Completion Guaranty, Carry Guaranty and Equity Funding Guaranty by the Company, as original guarantor; and that the Recourse Guaranty and Environmental Indemnification Agreement by the Company, as original guarantor, are only in full force and effect with respect to matters arising prior to the execution of the second amendment. In connection with the Recapitalization Transactions, this loan was assigned to TPHGreenwich.

237 11th Loans

In June 2021, 470 4th Avenue Fee Owner, LLC, a subsidiary of the Company (the “237 11th Senior Loan Borrower”), entered into a $50.0 million senior loan (the “237 11th Senior Loan”) provided by Natixis, and 470 4th Avenue Owner, LLC, a subsidiary of the Company (the “237 11th Mezz Borrower”, and together with the 237 11th Senior Loan Borrower, the “237 11th Borrowers”), entered into a $10 million mezzanine loan (the “237 11th Mezz Loan” and together with the 237 11th Senior Loan, the “237 11th Loans”), provided by an affiliate of LibreMax Capital, LLC, (together the “237 11th Lenders”).

In connection with the Recapitalization Transactions, (i) the 237 11^th Senior Loan Borrower entered into a fourth amendment to the 237 11^th Senior Loan with certain affiliates of the Investor as supplemental guarantors and Natixis, New York Branch, as lender and agent and (ii) the 237 11^th Mezz Borrower entered into a fourth amendment to the 237 11^th Mezz Loan with certain affiliates of the Investor as supplemental guarantors and Lexington 11^th Street, LLC, as lender, which each provide, among other things, that the respective Completion Guaranty by the Company as original guarantor under each 237 11^th Loan is terminated, and that the respective Recourse Guaranty by the Company as original guarantor under each 237 11^th Loan is only in full force and effect with respect to matters arising prior to the date of the fourth amendment or matters authorized by the Company.

As of February 14, 2024, there was an outstanding balance of $50.0 million on the 237 11^th Senior Loan and $10.0 million on the 237 11^th Mezz Loan.  In connection with the Recapitalization Transactions, this loan was assigned to TPHGreenwich.

Secured Line of Credit

The subsidiary that owns the Paramus Property (the “Paramus Borrower”) has an $11.75 million secured line of credit that is secured by the Paramus, New Jersey property.   On March 18, 2024, the Paramus Borrower entered into an amendment to the Secured Line of Credit, pursuant to which the maturity date was extended to October 15, 2024, with an option to further extend to April 15, 2025. As part of the amendment, the Company re-affirmed its guaranty under the Secured Line of Credit. The Secured Line of Credit is pre-payable at any time without penalty. The secured line of credit had an outstanding balance of $11.75 million at February 14, 2024 and December 31, 2023, respectively, and an effective interest rate of 2.5% as of February 14, 2024 and December 31, 2023, respectively.  

In connection with the transfer of the loans to TPHGreenwich, the associated unamortized loan costs were fully amortized in Trinity’s consolidated statement of operations.

Interest

Consolidated interest expense, net includes the following (in thousands):

	Three Months Ended		Three Months Ended		Six Months Ended		Six Months Ended
	June 30,		June 30,		June 30,		June 30,
	2024		2023		2024		2023
Interest expense	$	—	$	7,194	$	3,883	$	14,211
Interest capitalized		—		—		—		(689)
Interest expense, net	$	—	$	7,194	$	3,883	$	13,522