More on Non-Traded REIT IPOs-via-Mergers
(Feb 2013)
So far, two large non-traded REITs (Cole Credit Property Trust II and American Realty Capital Trust III) have merged with traded REITs. Merging with a traded REIT is one way for these otherwise largely illiquid investments to bring their assets to market and allow their investors to cash out. The more traditional 'exit strategy', and the strategy anticipated by most non-traded REIT offering documents, would be to have an independent initial public offering (IPO). So why are some non-traded...
Crowdfunding and Real Estate Investing
(Jan 2013)
The JOBS Act of 2012 was ostensibly designed to increase investment in small businesses. One of its provisions was to allow private placement investments (such as hedge funds, oil and gas partnerships, etc) to advertise publicly. Another provision is to allow for 'crowdfunding' of real estate and other investments, in effect allowing the sale of partial interests in speculative ventures to small retail investors. Kaitlin Ugolik at Law360 has a great review of the implications of this...
SLCG Research: Tenants-in-Common Interests
(Jan 2013)
While we've spent a great deal of time talking about non-traded REITs on this blog, so far we've given less attention to another kind of real estate investment that has also been sold to investors based on questionable merits: tenants-in-common (TIC) interests. TICs are private placement investments that were very popular during the real estate boom of 2002-2008, but have suffered tremendously when the markets turned sour. We discussed TICs in our paper on non-traded REITs, but we felt that...
