Thank you, Henri. I'll take a couple of minutes to describe the current state of the market as we see it, and then comment on our current portfolio performance and investment strategy. Market conditions continued to be affected by COVID-19, but mainly in certain pockets and to a far lesser extent than earlier in the crisis. Liquidity conditions remain exceptionally robust.
We are seeing rebounding and even increasing transaction volumes, tightening credit yields and greater leverage multiples back to pre-COVID levels and the willingness to accept greater risk. Earlier in the crisis, deals were mostly limited to existing portfolio companies either pursuing growth initiatives or seeking liquidity. This started to change in Q2 of last year and it's accelerated since then. Significant competition for quality deals is helping widen leverage and tighten pricing even back to pre-COVID levels. Calendar Q1 was quite robust and there appears to be a positive outlook for calendar year 2021. Lenders in our market are for the most part staying disciplined with covenants, and requiring deals to have a healthy equity capitalization.
Our underwriting bar remains high as usual, yet we are actively seeking and finding opportunities to deploy capital. We believe that compelling risk adjusted returns can be achieved by deploying capital and supportive businesses that have demonstrated strength and durability throughout the COVID environment. Follow-on investments with existing borrowers with strong business models and balance sheets continue to be an important avenue of capital deployment.
As demonstrated with 11 follow-ons this past quarter. Most notably, we have invested in 12 new platform investments since the onset of the pandemic, including two in this past calendar quarter. Portfolio management continues to be critically important, and we remain actively engaged with our portfolio companies.
We have found that they have generally taken the right steps to help mitigate both the near and long-term effect of COVID-19 on your businesses.
As we've mentioned before, many of them are also able to avail themselves of the Paycheck Protection Program or PPP loan relief.
All of our loans in our portfolio are paying according to their payment terms, including Rosco that returns to accrual this quarter. Taco Mac and My Alarm are the two investments that remain non-accrual. There have been no new non-accruals prior to and through COVID.
We also recognize that an additional $5.6 million and unrealized appreciation this quarter, which means that our overall portfolio has recovered over 95% of the unrealized depreciation in Q1. And the fair value of Saratoga’s assets has recovered to 1% over its cost basis. And we believe this strong performance reflects certain attributes of our portfolio that bolster its overall durability. 80% of our portfolio is in first lien debt, and generally supported by strong enterprise values in industries that have historically performed well, in distressed situations.
We have no direct energy or commodities exposure.
In addition, the majority of our portfolio is comprised of businesses that produce a high degree of recurring revenue, and have historically demonstrated strong revenue retention. There remains potential future adverse effects of COVID-19 on the market conditions and the overall economy, including but not limited to the related declines in market multiples increases in underlying market credit spreads and company specific negative impacts on operating performance, and could lead to unrealized and potentially realized depreciation being recognized in our portfolio in the future.
Now, despite this lack of clarity, we continue to believe that our well constructed capital structure and liquidity will help us to navigate beyond the challenges presented by COVID-19 and the broader macro environment.
Our approach has always been to stick to our strategy and focus on the quality of our underwriting. And as you can see on slide 15, this approach has resulted in our portfolio performance being at the top of the BDC list that has only seven BDCs with a positive net realized gain as a percentage of portfolio cost over the past three years. A strong underwriting culture remains Paramount at Saratoga. We approach each investment working directly with management, and ownership to thoroughly assess the long term strength of the company and its business model. We Endeavour to appear as deeply as possible into a business in order to understand accurately its underlying strengths and characteristics. We always have thought durable businesses and invested capital with the objective of producing the best risk adjusted accretive returns for our shareholders over the long term.
Our internal credit quality rating reflects the impact of COVID and shows 93% of our portfolio at our highest rating as of year end.
Looking at slide 16. Total leverage for the overall portfolio for investments underwritten using EBITDA was 3.63 times, down from 4.03 times in the previous quarter, reflecting strengthen portfolio company capitalization, and the lower leverage of certain new deals.
Our leverage is also below the average year to date market leverage multiples which are about five times across our industry. Through past volatility, we have been able to maintain a relatively modest risk profile throughout, although, we never consider leverage in isolation. Rather focusing on investing in credits with attractive risk return profiles and exceptionally strong business models where we are confident the enterprise value of the business will sustainably exceed the last dollar of our investment.
In addition, this slide illustrates our strengthening ability to generate new investments over the long term, even in the midst of the difficult market dynamics.
During the calendar year 2020, we added 11 new portfolio companies and made 26 follow-on investments, including a follow-on to that supported portfolio company's liquidity during COVID-19.
We also added two platforms and five follow on investments in the first calendar quarter of 2021. That we were able to accomplish this in the face of COVID challenges underscores the ongoing emphasis on broadening our origination capabilities.
Now subsequent to fiscal year end, including investments that are either close today or will be closing in the next couple of days.
We have executed approximately 90 million of new originations in three new portfolio companies and six existing portfolio companies and also had one repayment of approximately $14 million for net new investments originated of approximately $76 million.
Moving on to slide 17, our team's skill-set, experience and relationships continue to mature. And our significant focus on business development has led to new strategic relationships that have become sources of new deals.
Our number of deal sources dropped reflecting the difficult sourcing environment during much of last year, although we are beginning to see a more active deal pipeline in this year. The 52 term sheets issued during the last 12 months is also markedly up from last year's pace. What is especially pleasing to us is that almost one-fifth of our term sheets issued over the past 12 months, and four of our 10 new portfolio company investments are from newly formed relationships, reflecting notable progress as we expand our business development efforts. There are a number of factors that give us measured confidence that we can continue to grow our AUM steadily in this environment, as well as over the long term.
First, we continue to grow our reach into the marketplace, as evidenced by several investments we have recently made with newly formed relationships.
Second, we have developed numerous deep, long-term relationships with active and established firms that look to us as their preferred source of financing.
Third, we continue to see plenty of investment opportunities in industry segments that are experiencing long term secular growth trends, and within which we have intentionally developed expertise.
As you can see on slide 18, our overall track record is very strong, on almost $1.1 billion of originations.
On the chart on the right, you can see the total gross unlevered IRR on our $514 million of combined weighted SBIC and BDC unrealized investments is 13% since Saratoga took over management. The two largest unrealized depreciations remaining due to COVID are in our Nolan Group and C2 Education investments, both of which are more dependent on in person human interaction. We did not believe the remaining unrealized depreciation changes our view of their fundamental long term performance. Even with those current markdowns, our overall portfolio fair value is now 1% above its total cost.
Our investment approach has yielded exceptional realized returns.
Our gross unlevered IRR on the realized investments is 16.5% on approximately $561 million of realization. Subsequent to year end, we also had some developments on our My Alarm centre investment, which had a remaining fair value of $181,000. The senior debt burden of the company plus the cost of acquiring and retaining new customers resulted in significant pressure on cash flow and liquidity.
As a result, a new senior lender took a majority position in the credit and is accelerated its debt through a recent pre-packaged chapter 11 filing, with the equity sponsor choosing not to infuse additional capital into the business at this time, there is very little prospect for recovery at the junior capital.
Moving on to Slide 19, you can see our first SBIC license is fully funded with 208 million invested as of year end, and we have started paying down some of our SBIC I debentures using repayment proceeds, with 26 million repaid in Q4. Repayments of debentures occur on a semi annual basis.
Our second SBIC license has already been funded with $69 million, of equity, of which 107 million of equity and SBA debentures have been deployed. There are still 3.4 million of cash and 104 million of debentures currently available against that equity. We still have 18.5 million of unfunded equity, which when dropped down into the SBIC would increase our debenture availability by $37 million.
Looking back over the whole year, the way the portfolio has proven itself to be well constructed, and resilient against the impact of COVID-19, really came to the fore, demonstrating the strength of our team, platform and portfolio, and our overall underwriting and due diligence procedures. Credit quality is always our primary focus. And while the world has changed significantly this year, we remain intensely focused on preserving asset value, and remain confident in our team and the future for Saratoga Investment. This concludes my review of the market and our portfolio. And I'd like to turn the call back over to our CEO, Chris.