AP Capital MIC
AP Capital Mortgage Investment Corporation (MIC) started in 2007 and is a mortgage lender in Western Canada. The firm advances short term (1 year) mortgages to owners of primarily single detached homes in urban areas of BC and Alberta. Borrowers are home owners who require short term funds (bridge financing) and often do not fit with conventional bank underwriting. Equity in each borrower’s home is what protects the fund’s capital as target loan to value is 70%, leaving 30% equity to protect AP in the event of borrower default. Approximately 1,000 mortgages (worth $200M) have been advanced since inception. Visit the Fast Facts for current mortgage portfolio details. Mortgages are sourced through mortgage brokers at interest rates ranging from 7 to 13 percent. As a Western Canadian private mortgage fund, AP Capital provides an investment option for Canadian investors looking for alternatives to traditional investments.
Registered funds (e.g. RRSP, TFSA, LIRA, RESP) as well as open or cash funds can be invested.
The investment objectives of AP Capital MIC are:
- To preserve capital by acquiring and maintaining a diversified, conservative portfolio of mortgage loan investments that generates attractive stable returns.
- Provide an annual distribution of 7.0%+, paid monthly. A target that has been reached since 2008.
AP Capital maintains affiliations and membership with associations that add to the quality of its business. The Company is proud to be a member of the British Columbia MIC Managers Association (BCMMA) and the Canadian Association of Accredited Mortgage Professionals (CAAMP).
|Fund Type||Mortgage Investment Corporation (MIC)|
|Current Fund Size||$64MM subscribed (March 2018)|
|Years in business||Incorporated March 2007|
|Monthly Distributions||Monthly distribution of 7.0% per annum. Cash or DRIP (dividend reinvestment)|
|Share Price||$100.00 per Class B Common Share|
|Dividends||Taxed as interest income. T5 Tax Slips provided to Open/Cash Investors.|
|Credit Facility||$14.0MM (HSBC)|
|Loan Asset Class||Primarily Residential Mortgages|
|Retraction rights||Retractable on demand (with 60 days notice before year end) subject to a retraction penalty schedule (see OM). Mid-year retraction available (conditions apply).|
|Management Fee||2.85% per annum of mortgages under management.|
|Offering for||Residents of British Columbia, Alberta, Saskatchewan, Manitoba, and Ontario, who are provided with an Offering Memorandum and must complete a Risk Acknowledgment form|
|Eligibility||RRSPs, RRIFs, RESPs, LIRA and TFSA|
|Monthly Fast Facts||Monthly Fast Facts|
|Historical Data (at May 2017):|
|Mortgages advanced since fund's inception||1,000|
|Approximate value of mortgages since fund's inception||$200M CAD|
|Shareholder Yield||2016; 7.19%* (Dec 31)
2016; 7.13%* (June 30)
*Weighted Average Return
AP Capital MIC handles the entire mortgage process from origination to underwriting and fund management. AP Capital MIC follows two sets of conditions. Firstly the conditions set by the Tax Act that enables AP Capital MIC to qualify as a Mortgage Investment Corporation and secondly, the firm has set its own market specific underwriting criteria to ensure a prudent approach that achieves capital preservation of investor capital.
The fund has established certain policies respecting how it can advance mortgages; which include, but are not limited to, the following:
- The fund will primarily invest in residential mortgages in major urban areas in Western Canada such as Greater Vancouver, Greater Edmonton and Calgary
- Target 1st position mortgages of 50% of fund
- Average term to maturity of mortgages in the portfolio will not exceed 24 months
- Target weighted average loan-to-value of the portfolio is 70%
Mortgage Approval Process
The due diligence procedure employed by AP Capital MIC has resulted in a strong track record of risk management. In addition to deal due diligence, the firm carefully monitors the mortgage portfolio, maintains active communication with borrowers and follows strict enforcement procedures. Our due diligence focuses on a multitude of risk factors, including borrower profile, property value and market analysis.
How to invest?
AP Capital MIC requires retail investors to invest through an approved Investment Dealer or Exempt Market Dealer (EMD). Dealer representatives assist in completing the subscription agreements and discuss the suitability of AP Capital MIC for each investor’s overall portfolio.
AP Capital MIC accepts new investors twice monthly throughout the year. Open (cash) investors simply complete the Subscription Agreement after reviewing the most recent Offering Memorandum. Registered investors have a few extra steps as funds must come via custodian / trust companies.
- Review the OM and executive summary
- Fill out the Subscriptions Agreement and Risk acknowledgement forms
- Fill out the Pre Authorization forms
- For registered investment: AP Capital accepts Registered funds from numerous trustees. Please contact us for details on forms required for account creation and fund transfers.
- Please send documents to:
AP Capital MIC
555 Burrard Street, Unit 1795
Vancouver, BC V7X 1M9
Attention: Investor Relations
fax: 604.608.9070 | Phone: 778.328.7401