Pelorus Breaks Credit Grass Ceiling With A Rated Notes

May 17, 2023 · Green Market Report

Cannabis debt has been typically given low ratings if receiving a rating at all. This week, cannabis commercial real estate lender Pelorus Capital Group announced that $50 million in aggregate principal amount of 7% senior secured notes due September 26, 2026 issued by its private mortgage real estate investment trust subsidiary, the Pelorus Fund REIT, have been assigned an A rating by Egan-Jones Rating Company – the highest rating issued to date in the cannabis industry.

“We are proud to achieve a cannabis-industry first by achieving an A-flat rating,” said Dan Leimel, CEO of Pelorus Capital Group (previously Pelorus Equity Group) and the manager of the Pelorus Fund. “We believe this two-step rating increase reflects our financial health and our significant growth, while securing the Notes provides more flexibility as the Pelorus Fund continues to grow and gain market share. Against a backdrop of challenging market conditions, particularly within the cannabis sector, we believe we are now even better positioned to grow our deal pipeline, strengthen our business and offer attractive lending solutions to cannabis businesses across the country.”

The Pelorus Fund issued the Notes, which were previously unsecured, in 2021 and at the time received a BBB+ rating from Egan-Jones. At the time, this was the first issued by a privately held mortgage REIT to receive what was then the highest credit rating achieved by an issuer operating within the cannabis sector. When this rating was issued in 2021, Pelorus Fund had approximately $130M in assets under management, which has nearly tripled to approximately $376M in AUM currently.

Recently, the Pelorus Fund completed a transaction to secure the Notes, which when combined with the strength of the balance sheet, successful track record, and investment income growth year-over-year resulted in Egan-Jones upgrading the BBB+ rating to an A rating. An Egan-Jones A rating is defined as having a high level of creditworthiness with low sensitivity to evolving credit conditions. (Full Story)

In category:Business
Next Post

California Cannabis Companies Form Group to Address Industry’s ‘Culture of Nonpayment’

A cohort of cannabis industry operators on Tuesday announced a coalition that seeks to raise awareness and offer solutions to severe credit issues that threaten the industry’s stability. The Financial Stability for California Cannabis (FSCC) includes Kiva Sales & Service,…
Read
Previous Post

Planet 13 Reports Q1 Loss, Maintains Nevada Market Share

Net loss for the quarter rose due to lower gross profit and high one-time costs. Las Vegas-based Planet 13 Holdings Inc. (CSE:PLTH) (OTCQB:PLNHF) posted a 3% decline in revenue for the first quarter ended March 31, which it primarily attributed to a…
Read
Random Post

Can You Sue Facebook If You Get Scammed Online? - Zuckerberg Sued for Aiding and Abetting Fraud in JuicyFields Case

Swedish attorney goes after Mark Zuckerberg for marijuana investment fraud scheme Regarding the marijuana Ponzi scam Juicy Fields, Swedish attorney Lars Olofsson has filed a class action lawsuit against Facebook and Instagram's parent company Meta (META). The scam affected over 800 persons…
Read
Random Post

First-of-its-kind medical marijuana lounge opens in Maryland

This past Saturday, March 3, Maryland's first-ever cannabis lounge opened for business in Burtonsville. Advertised as a safe space to consume cannabis and pass the time, the Ceylon House, located at 4009 Sandy Spring Road, was created in concept by owners…
Read
Random Post

Oregon Audit Forces State Official to Resign Cannabis Consultancy

Other state lawmakers had criticized the business arrangement. Oregon’s secretary of state on Monday cut ties with a marijuana business she’d been consulting with after the business arrangement came to light following a state audit of Oregon’s cannabis industry. “I exercised poor…
Read
Random Post

The NBA is getting ready to let players invest in and promote cannabis under a new union deal — here are 3 easy ways for investors to take advantage

The National Basketball Association has given a tentative green light to players who want to invest in and promote cannabis companies. Under a new collective bargaining agreement with the National Basketball Players Association — which is pending ratification by players…
Read