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  1. 119 Posts.
    From today's Gold Coast Bulletin regarding refinancing of CPFMF CBA loan. They are have a $203M debt to the CBA, the bank has extended the loan for 12 months and they plan to recommence distributions to unitholders - and yes this is actually a condition of the CBA loan!

    PIF has only $5m debt from a financial institution the RE refuses to name or divulge the terms, we are prevented from receiving distributions as a condition of the loan and the RE is well overdue with a market and unitholder update. WHAT IS GOING ON!!!!!!!!

    February 20, 2009 04:44pm

    City Pacific's bank lifeline

    Nick Nichols, business editor

    February 20th, 2009

    CITY Pacific has won a 12-month reprieve from its bankers, prompting the company to immediately shore up its defences against disgruntled investors in its frozen mortgage fund.

    The Commonwealth Bank of Australia (CBA) has given the company until February 26 next year to repay $203.5 million in loans, although it is unlikely to ease City Pacific's recovery action against developer borrowers such as Craig Gore.

    As part of the deal, the property financier also has sought permission to resume paying distributions to the 14,000 anguished unit-holders in the First Mortgage Fund.

    City Pacific chief executive John Ellis yesterday said the prospect of resuming distributions was 'very real' and he was hopeful this could be done in the next month or two.

    "It's critically important to (start repayments) as soon as possible," he said. But the news was not warmly received by one unit-holder who said he had 'heard it all before' from the company.

    "The trust is gone, it's broken," said the investor.

    City Pacific has been under pressure from several groups of unit-holders in the $900 million fund agitating to have the company removed as responsible entity.

    Mr Ellis said City Pacific was aware of the moves, but the company had never received a 'substantive offer' to do so.

    "We've had shots across the bow, but we've never actually had a formal proposal," he said.

    The planned payout for investors, the first since this time last year, will be a far cry from the high returns unit-holders have come to expect from City Pacific.

    Mr Ellis said it was more likely the payout would be in line with bank interest and he confirmed it would be sourced from fund revenue and would not be deemed a capital repayment.

    Mr Ellis said resumption of distributions was an essential component of the refinancing deal with the CBA. The company signed off on the agreement on Wednesday.

    The latest 12-month extension is significant as the CBA had on previous occasions offered only three-month extensions.

    "Having three months' extension on your finance doesn't really give you the ability to conduct any sort of orderly strategy around debt reduction," said Mr Ellis who conceded he was relieved.

    "Twelve months certainly gives us a far better prospect (of that)."

    City Pacific's Gold Coast borrowers include the Raptis Group, which is in administration, and Mr Gore.

    Last week, City Pacific appointed receivers to three of Mr Gore's companies which owe the First Mortgage Fund $145 million.

    Mr Ellis said City Pacific would continue to actively recover loans from developers, although he preferred to work with borrowers to achieve this.

    City Pacific's development offshoot CP1 is yet confirm if it has secured an extension of its $112 million loan. Mr Ellis said he could not comment on CP1's prospects.

    "From the First Mortgage Fund's point off view we would welcome a similar show of confidence by the CBA for CP1."

    City Pacific's shares surged on the news yesterday, closing 24 per cent higher at 9.3c.
 
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