In determining an estimated value of CCPT II’s shares of common stock in July 2011, the board of directors of CCPT II relied upon information provided by an independent investment banking firm that specializes in providing real estate financial services, and information provided by CCPT II Advisors. In determining an estimated value of CCPT II’s shares of common stock in June 2010, the board of directors of CCPT II relied upon information provided by an independent consultant that specializes in valuing commercial real estate companies, and information provided by CCPT II Advisors.
The valuation periods are July 2011 and June 2010. The July 2011 valuation was $9.35 per share and the June 2010 valuation was $8.05 per share. CCPT II used a consultant in 2010, and an investment bank in 2011 to provide information. Both valuations relied in information provided by CCPT II's advisor. There is no other disclosure on the methodologies. The increase of $1.30 per share, or 16% is sizable for a REIT that is not trading. It'd be interesting to know what inputs were changed in 2011 to bump the value of a REIT that has a mainly fixed portfolio. It's not the valuation methods, its data and assumptions that are put in the valuation models.
Cole adds the following disclosure after discussing the valutaion:
The statements of value were only an estimate and may not reflect the actual value of CCPT II’s shares of common stock. Accordingly, there can be no assurance that the estimated value per share would be realized by CCPT II’s stockholders if they were to attempt to sell their shares or upon liquidation.There is no truer sentence in the entire filing. It's time for CCPT II to execute the liquidity event it disclosed it was going to seek within twelve months back in June 2011.