Business
MRTI - May 6, 2009 News Release
MRTI - May 6, 2009 News Release.
About this update from Maxus Realty Trust, Inc.
[{"type":"text","content":"May 6, 2009Pink OTC Markets News Service North Kansas City, MO— On May 4, 2009, the Board of Trustees of Maxus Realty Trust, Inc. (“MRTI”) held a special meeting of the Board. At the meeting, the Board discussed receipt of a letter regarding the outstanding promissory note secured by Barrington Hills Apartments from Fannie Mae. Barrington Hills is a multi-family apartment complex MRTI owns through Barrington Hills Acquisition, L.L.C., a wholly-owned subsidiary of MRTI’s operating limited partnership. The letter from Fannie Mae provided notice that Barrington Hills did not currently meet the debt service coverage standard required by the promissory note relating to the 1999 revenues bonds used to finance Barrington Hills. As a result, management understands that the Barrington Hills promissory note, which has an outstanding principal balance of approximately $5,153,000 on March 31, 2009, may become due on August 1, 2009. Management was not aware that the promissory note could become due as a result of Barrington Hills failing to meet the debt service coverage ratio and does not believe Barrington Hills will meet the debt service coverage ratio prior to August 1, 2009. As a result, instead of the promissory note becoming due in 2029 as previously disclosed, it now appears that the promissory note may become due and payable on August 1, 2009. Management intends to negotiate with Fannie Mae to amend the note to provide for a floating interest rate or refinance the note with a conventional Fannie Mae ten year fixed loan amortized over thirty years, but management cannot provide any assurance as to whether MRTI will be able to negotiate such an arrangement with Fannie Mae. At the meeting, the Board also approved the potential acquisition of a multi-family apartment complex near Dallas, Texas. The Board authorized management to enter into a purchase agreement for the property if appropriate terms could be negotiated. Management anticipates the purchase price will be approximately $15 million and hopes to finance approximately $12 million of the purchase price. The Board also decided to suspend the payment of dividends until at least December, 2009. The Board believes it is in MRTI’s best interest to preserve...