Ares US Real Estate Opportunity Fund III
AREOF III Leverage Profile(¹)
Ares seeks to employ a prudent approach to use of leverage
Asset Leverage
Approach
Cross-
Collateralization
Policies
Subscription
Facility
■
I
I
■
■
■
■
■
Maximum 70% leverage at portfolio level, target of 65%
Rely almost exclusively on non-recourse debt
Prudent use of fund-level debt facilities while avoiding fund level guarantees
Ares does not cross-collateralize loans across separate transactions within a fund
Assets acquired or assembled as a portfolio may, however, be cross-collateralized
Ares uses a subscription facility during the Fund's investment period as a cash
management tool, enabling the fund to act quickly and to provide time to place
permanent debt on properties
AREOF III's subscription facility is provided by SMBC and expires in February 2022
with 2 one-year extension options at our discretion
Current size/Maximum Size/Balance: $100 million / $400 million / $46.5 million
The use of leverage magnifies the potential for gain or loss on the amount invested and may increase the risk of investments.
1. The leverage profile described herein is shown for illustrative purposes only and should not be construed as a reflection of the exact leverage profile undertaken or to be undertaken by AREOF III.
Confidential - Not for Publication or Distribution.
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