{"id":9344,"date":"2023-05-16T06:56:12","date_gmt":"2023-05-16T10:56:12","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/pelorus-capital-group-marks-debt-upgrade-milestone-for-cannabis-finance-sector\/"},"modified":"2023-05-16T06:56:13","modified_gmt":"2023-05-16T10:56:13","slug":"pelorus-capital-group-marks-debt-upgrade-milestone-for-cannabis-finance-sector","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=9344","title":{"rendered":"Pelorus Capital Group marks debt upgrade milestone for cannabis finance sector"},"content":{"rendered":"
\n

Pelorus Capital Group has received what it described as the highest debt rating in the cannabis lending space with an upgrade by two notches to A from Egan-Jones on its $50 million bond, MarketWatch has learned.<\/p>\n

The Newport Beach, Calif. lender in the cannabis space with $376 million of assets under management said Monday that its 7% senior secured notes were upgraded by debt research firm Egan\u2010Jones to A, with a positive watch, from BBB+. The company\u2019s overall rating remains BBB+.<\/p>\n

\n

\u201cThe credit rating is supported by the strength of the balance sheet, successful\u2026track record and investment income growth year\u2010over\u2010year,\u201d Egan\u2010Jones said in a research note provided to MarketWatch.<\/p>\n

The higher rating on the notes signals that the debt is seen as more secure and it would help Pelorus potentially obtain a lower cost of capital than it would have under the old rating if it goes out to the debt market again to raise capital.\u00a0<\/p>\n

Pelorus Capital Group president Rob Sechrist said the upgrade is seen as a milestone, for the firm and for the cannabis lending space overall.<\/p>\n

\u201cThe higher rating signals the markets are starting to acknowledge that Pelorus keeps breaking these glass barriers,\u201d Sechrist told MarketWatch.<\/p>\n

Egan\u2010Jones is the only major debt rating firm that rates cannabis company debt. Moody\u2019s, S&P and Fitch Ratings do not rate cannabis debt because it remains a Schedule I controlled substance under federal law.<\/p>\n

Prior to the Pelorus Capital Group A-rated debt, no cannabis company had earned an A rating from Egan-Jones, Pelorus Capital Group said.<\/p>\n

Sechrist estimated that if the company had gone to raise the $50 million bond back in 2021 with the higher debt rating it has now, the bond would have priced closer to 5% rather than 7%.\u00a0<\/p>\n

Pelorus Capital Group was the first private mortgage real-estate investment trust in the cannabis sector when it debuted in 2016.<\/p>\n

Other debt providers in the cannabis space include Chicago Atlantic Real Estate Finance Inc.
\n REFI,
\n -0.77%<\/bg-quote>,<\/span>
\n Innovative Industrial Properties
\n IIPR,
\n +0.78%<\/bg-quote>
\n and AFC Gamma
\n AFCG,
\n +1.26%<\/bg-quote>.<\/span>\n <\/p>\n

Pelorus specializes in bridge loans for construction projects and fully stabilized for cannabis\u2010use facilities.<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Pelorus Capital Group has received what it described as the highest debt rating in the cannabis lending space with an upgrade by two notches to A from Egan-Jones on its $50 million bond, MarketWatch has learned. The Newport Beach, Calif. lender in the cannabis space with $376 million of assets under management said Monday that […]<\/p>\n","protected":false},"author":1,"featured_media":9345,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-9344","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nPelorus Capital Group marks debt upgrade milestone for cannabis finance sector | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Pelorus Capital Group has received what it described as the highest debt rating in the cannabis lending space with an upgrade by two notches to A from\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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