Nontraded REIT will list on NYSE

Chambers Street Properties is latest to seek liquidity event

Apr 30, 2013 @ 3:36 pm

By Bruce Kelly

NYSE
+ Zoom
((Photo: Bloomberg News))

Another nontraded, triple-net-lease REIT intends to list on a stock exchange, making 2013 another impressive year for such real estate investment trusts.

Chambers Street Properties, with $3.2 billion in assets, intends to list on the New York Stock Exchange on or about May 21. The REIT, which launched in 2006 and was formerly the CB Richard Ellis Realty Trust, has equity of a little under $2.5 billion.

Chambers Street's announcement of a listing comes after two other triple net lease REITs, Cole Credit Property Trust II and Cole Credit Property Trust III, said earlier this year they were also working on “liquidity events.” In the nontraded REIT industry, that phrase means giving investors the ability to cash out their formerly illiquid shares through a merger, acquisition or listing.

Triple-net-lease REITs, in which high-quality tenants and not the REIT sponsors are responsible for maintenance, insurance and tax costs for the properties, have been a favorite of investors and financial advisers seeking income in a near zero interest rate environment.

“The markets are very strong right now and receiving these types of offerings pretty favorably,” said Jack Cuneo, chief executive of Chambers Street Properties. He said that 80% of the REIT's assets were in triple net least properties, with the goal to continue buying corporate net lease assets. “We're pretty excited about the market and our position in it and where we're going,” he said.

The REIT also intends to launch a modified “Dutch auction” tender offer to buy up to $125 million of its shares, within a range of $10.10 to $10.60 per share. At the end of last year, the REIT was given an estimated value of $10 per share. Last year, the REIT internalized its management team without paying a separate internalization fee, the company said in a statement.

The move by Chambers Street Properties comes on the heels of announcements in January by Cole II and in March by Cole III that they were also moving toward liquidity events. Cole II expects to complete a merger with the listed REIT Spirit Realty Capital by the end of September. Those two REITs would have a combined $7.1 billion in real estate assets.

Meanwhile, Cole III, with $7.4 billion in assets, intends in June to list on the NYSE.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

Building digital relationships with a human touch

The word "robo" has stopped being a four-letter word for financial advisers. But how can it be an asset? Quovo's Jeff Hendren explains.

Video Spotlight

Will It Last As Long As Your Clients Do?

Sponsored by Prudential

Video Spotlight

The Catalyst

Sponsored by Pershing

Latest news & opinion

Voya's win in 401(k) fee suit involving Financial Engines bodes well for other record keepers

Fidelity, Aon Hewitt and Xerox HR Solutions are currently defending against similar fiduciary-breach claims.

Collective investment trusts getting more attention from 401(k) advisers

The funds are catching on due largely to lower costs and more product availability, but come with some inherent drawbacks.

Vanguard rides robo-advice wave to $65B in assets

Personal Advisor Services, four times the size of its closest competitor, combines digital and human touch.

CFPs, including brokers, may have to adhere to a stricter fiduciary duty

CFP Board revises its standards and aims to beef up fiduciary requirements of certificants.

CFP Board's proposal to expand fiduciary duty draws praise, carries risks

Some question whether brokers will drop the CFP mark or if the CFP Board will strictly enforce its new standard.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print