Aimco amends loan, ups rates, reduces minimum fixed charge and interest coverage ratios

By Sara Rosenberg

New York, Nov. 4 - Apartment Investment and Management Co. (Aimco) said it amended its credit facility.

The changes increase interest rates, reduce the minimum fixed charge ratio to 1.40:1 from 1.50:1, reduce the interest coverage ratio to 2.00:1 from 2.25:1 and increase the ratio of permitted debt to gross asset value to 0.575 to 1 from 0.55 to 1 at the company's election.

Based on current coverage levels, the applicable margin on Libor-based borrowings under the revolver increased to 285 basis points from 265 basis points and the applicable margin on term loan borrowings increased to 285 basis points, the company said.

Furthermore, under the amendment, the company increased to 90% the percentage of funds from operations permitted to be distributed for all quarters until maturity and received permission to exclude preferred redemption charges under EITF D-42 and marked-to-market adjustments from FAS 150 from interest expense and dividends when calculating coverage ratios, according to a news release.

The modifications were completed to accommodate recent accounting changes required by FIN-46, EITF D-42 and FAS 150 and the challenging operating environment for apartment properties," a news release said regarding the amendment.

Aimco is a Denver real estate investment trust that owns and operates a portfolio of apartment communities.

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