An opportunistic, short-term commercial financing strategy focused on core U.S. markets.  Trez Capital Yield Trust US participates primarily in large scale residential lot development projects in major urban centres of Texas.  In addition to its commercial loan portfolio, up to 20% of net assets may be invested in equity positions and 10% may be invested in mezzanine loans. The investment objective is to preserve invested capital, while generating an attractive rate of income in U.S. dollars for distribution to unitholders.

Fund Summary

Fund Manager: Trez Capital Fund Management Limited Partnership
Asset Class: Open-ended pooled mortgage fund
Inception Date: June 2013
Minimum Investment: US$5,000 (500 units)
Redemptions: 30 days' notice, subject to 1% retraction penalty if redeemed within 1st year
Eligibility: RRSP / RRIF / TFSA / RESP / RDSP / DPSP
FundSERV Codes: Series A USD - TRZ300, Series F USD - TRZ310
DRIP Eligible: Yes
Fund Assets (12/31/2016): US $223,358,820

Case Studies

  • Dallas Mixed-Use Repositioning
     
    Dallas Mixed-Use Repositioning
    Loan: US$20,000,000 (Tranche B: US$10,000,000)
    Security Rank:1st mortgage (Deed of Trust)6 months (with extension option)
    Term:6 months (with extension option)
    Interest Rate:15.0% (on B Tranche)
    Loan-to-Value:38.0% (on B Tranche)
    Description:
    Investment in the Junior (B) tranche of a first mortgage secured by a mixed use property undergoing repositioning.
  • Dallas Lot Development
     
    Dallas Lot Development
    Loan: US$10,500,000
    Security Rank:1st mortgage (Deed of Trust)
    Term:36 months
    Interest Rate:10.0%
    Loan-to-Value:64.0%
    Description:
    Investment in a first mortgage secured by a 96.5 acre site. The subject property will be developed into 299 lots in two phases. 100% of the lots were presold to three prominent homebuilders prior to the mortgage funding date.
  • Conroe Lot Development
     
    Conroe Lot Development
    Loan: Loan Amount: US$17,200,000 Preferred Equity: US$2,200,000
    Security Rank:1st mortgage (Deed of Trust)
    Term:36 months
    Interest Rate:Fixed rate: 8.5%. Projected IRR: 23.3% (includes profit participation)
    Loan-to-Value:69.0%
    Description:
    Quasi joint venture financing for the servicing and development of 272 lots on a 111 acre site. 91% of the Phase I lots were presold.

Portfolio Composition

Cash (and Equivalents) US $10,242,979
Other Assets US $2,408,126
Property Under Development 9,676,280
Mortgage Investments US $193,924,858
Total Assets Before Loan Syndication US $216,252,243
Total Assets US $210,893,786
No. of Mortgage Investments 53
Average Mortgage Size US $3,658,960
Average Loan-to-Value 67.2%

Geographic Region

Dallas
59.4%
Houston
12.2%
Austin
7%
Denver
4.3%
San Antonio
4%
Nashville, TN
1.3%
Fort Worth
0.4%
Cash and Other Assets
11.4%

Asset Class

Residential
87.5%
Retail
1.1%
Cash
4.7%
Other Assets
6.7%

Security Rank

First Mortgages
72.7%
Second Mortgages
9.7%
Third Mortgages
6.5%
Cash and Other Assets
10.1%

Weighted Average Term to Maturity

Month-to-Month
2.2%
Zero to 6 Months
12.5%
6 Months - 12 Months
24.1%
12 Months - 18 Months
1.8%
18 Months - 24 Months
19.3%
24 Months - 36 Months
40.1%

Historical Performance

  1 Year 3 Year 5 Year Since Inception
Trez Capital Yield Trust US
Series F
9.3% 10.0% N/A 10.1%
Trez Capital Yield Trust US
Series A1
8.2% 8.7% N/A 8.8%

1 A Series units were introduced on April 1, 2013.
Returns are reported as F Series, USD unit returns less 100 bps.

2 Due to the inception of the fund in January 2013, the return for 2013 is an annualized return.

Growth of $10,000

 

Trez Capital Yield Trust US distributes 100% of its net income annually. Unitholders receive quarterly distributions at a rate of 2.0% on Series F units and 1.75% on Series A units, payable fifteen days following each calendar quarter end. Distributions are paid in the currency of the units denomination. All residual income attribuable to each unit series is distributed by way of an annual top-up distribution, which is paid in mid-March following the conclusion of the annual audit of the Trust.

Distribution History

Year Series Q1 Q2 Q3 Q4 Total Quarterly Distribution Top-up1 Annual Distribution
2016 F $0.200 $0.200 $0.200   $0.200 $0.800  $0.098 $0.898
  A2 $0.175 $0.175  $0.175  $0.175 $0.700  $0.095 $0.795
2015 F $0.200 $0.200 $0.200 $0.200 $0.800 $0.674 $1.474
  A2 $0.175 $0.175 $0.175 $0.175 $0.700 $0.589 $1.289
2014 F $0.200 $0.200 $0.200 $0.200 $0.800 $0.268 $1.068
  A2 $0.175 $0.175 $0.175 $0.175 $0.700 $0.234 $0.934
2013 F $0.200 $0.200 $0.200 $0.200 $0.800 $0.200 $1.000
  A2 $0.175 $0.175 $0.175 $0.175 $0.700 $0.200 $0.900

1 Based on a weighted average return to Unitholders, this amount is an estimate of the average top up distribution paid. Those invested for less than a full one year period will receive a prorated allocation, and those invested in the dividend reinvestment plan will receive a slightly higher top up due to the effects of compounding.

2 A Series units were introduced on April 1, 2013.

 

Distribution Schedule

  Record Date Expected Pay Date
First Quarter March 31 April 15
Second Quarter June 30 July 15
Third Quarter September 30 October 15
Fourth Quarter December 31 January 15
Annual Top Up December 31 March 15

Note: Distributions are taxed in the year that they are earned. T3 slips are distributed to all unitholders in March of each year following completion of the year end audit and payment of the annual top-up distribution.

 

Fees

Management Fee 1.5% of the Average Annual Gross Assets relating to the F Series and A Series units.
Incentive Fee 10% of the Net Income for each unit series after deduction of the Management fee.

Minimum Investment

Province Minimum investment when relying on accredited investor exemption1 Minimum investment when relying on offering memorandum exemption2 Minimum investment amount exemption3
Alberta $5,000 $5,000 $150,000
British Columbia $5,000 $ 5,000 $150,000
Manitoba $5,000 N/A $150,000
New Brunswick $5,000 $5,000 $150,000
Newfoundland & Labrador $5,000 $5,000 $150,000
Nova Scotia $5,000 $5,000 $150,000
Ontario $5,000 $5,000 $150,000
Quebec $5,000 N/A $150,000

1 Accredited Investor Exemption: There is no regulatory minimum subscription amount for investors qualifying under the Accredited Investor Exemption. However, the minimum initial purchase amount established by the Manager is $5,000.

2 Offering Memorandum Exemption: There is no regulatory minimum subscription amount for investors qualifying under the Offering Memorandum Exemption. However, the minimum initial purchase amount established by the Manager is $5,000. (Only available for residents of British Columbia, Newfoundland & Labrador, Ontario, Alberta, Saskatchewan, Nova Scotia, and New Brunswick, subject to certain restrictions)

3 Minimum Amount Exemption (not available to individuals): The minimum initial subscription amount for investors qualifying under the Minimum Amount Exemption is $150,000 in each province listed above.

 

 

 

to invest, contact your financial advisor, or follow the procedure outlined below.

TREZ CAPITAL YIELD TRUST US is sold BY offering memorandum and is available to:

  • Residents of British Columbia or Newfoundland & Labrador, who are provided with an offering memorandum and complete a risk acknowledgment form (45-106F4).  Investment relies on the Offering Memorandum exemption.
  • Residents of Ontario, Alberta, Saskatchewan, New Brunswick, or Nova Scotia, who are provided with an offering memorandum and complete a risk acknowledgement form (45-106F4) with Schedule I and Schedule II (Classification of Investors and Investment Limits).  Investment relies on the Offering Memorandum exemption.
  • Residents of Manitoba or Prince Edward Island, who are provided with an offering memorandum and complete a risk acknowledgment form (45-106F4) and an eligible investor certification.  Investment relies on the Offering Memorandum exemption.
  • Residents of Quebec who qualify as accredited investors and complete an accredited investor certification and a risk acknowledgement form (45-106F9 - for individual investors only).  Investment relies on the Accredited Investor exemption. or;
  • By investing a minimum of $150,000 (for entities only).  Investment relies on the Minimum Amount exemption.

How To Invest

Units may be purchased directly from Trez Capital, or through a self-directed registered plan administered by one of the following:

  • Olympia Trust Company
  • Blue Shore Financial
  • Computershare Trust Company
  • Canadian Western Trust
  • Scotia Wealth Management

 

Fund Fact Sheets

  • Fund Fact Sheet (A Series)

    Fund Fact Sheet (A Series)
    December 2016 - Trez Capital Yield Trust US Fund Fact Sheet (A Series)
    View/Download »
  • Fund Fact Sheet (A Series) CAD

    Fund Fact Sheet (A Series) CAD
    December 2016 - Trez Capital Yield Trust US Fund Fact Sheet (A Series) CAD
    View/Download »
  • Fund Fact Sheet (F Series)

    Fund Fact Sheet (F Series)
    December 2016 - Trez Capital Yield Trust US Fund Fact Sheet (F Series)
    View/Download »
  • Fund Fact Sheet (F Series) CAD

    Fund Fact Sheet (F Series) CAD
    December 2016 - Trez Capital Yield Trust US Fund Fact Sheet (F Series) CAD
    View/Download »

Quarterly Unitholder Reports

  • December 2016 Quarterly Report

    December 2016 - TCYT US Quarterly Report
    View/Download »

Subscription Documents

  • FundSERV Brokers - Subscription Form (Corporate)

    March 2017 - FundSERV Brokers - Subscription Form (Corporate)
    View/Download »
  • FundSERV Brokers - Subscription Form (Individuals)

    March 2017 - FundSERV Brokers - Subscription Form (Individuals)
    View/Download »

Financial Statements

  • Audited Financial Statements

    December 2016 - Trez Capital Yield US Trust Audited Financial Statements
    View/Download »

Offering Documents

  • Offering Memorandum

    March 2017 - Trez Capital Yield Trust US Offering Memorandum
    View/Download »
  • Amended and Restated Declaration of Trust (US)

    December 2016 - Amended and Restated Declaration of Trust
    View/Download »
  • Declaration of Trust (CAD)

    December 2016 - Trez Capital Yield Trust US (Canadian $)
    View/Download »

The Declaration of Trust for Trez Capital Yield Trust US has been posted for informational purposes in connection with the special meeting of unitholders of Trez Capital Yield Trust US to be held on December 9, 2016, and remains subject to further change and finalization prior to the effective date of the reorganization of Trez Capital Yield Trust US, which is conditional upon, among other things, receipt of unitholder approval.