Wednesday, May 07, 2014

Griffin-American Healthcare Bids

Here is a free Wall Street Journal article on the final four bidders for the non-traded REIT Griffin-American Healthcare REIT II.  Bidders include affiliates of other non-traded REIT sponsors, in particular recently listed American Realty Capital Healthcare Trust (HCT) and a division of Northstar (NRF).  The bidding, according to the article, is expected to conclude within two weeks.  The article states:
The investors, mostly retirees and other individuals, paid between $10 and $10.22 a share from 2009 to 2013. Current offers from the four finalists have topped $12.50 a share, according to people briefed on the price, which would put the company's value at $3.66 billion.
At $12.50 per share, the sale would be a success for investors.  (I'm not sure how the article's author knows that most of the investors in Griffin American Healthcare REIT II are retirees.)  I will watch for filings to see how this potential transaction proceeds.

On a separate matter, the article includes good information on non-traded REIT liquidity events and includes this quote:
This year "is going to be something of a litmus test for nontraded REITs, to see if they can exit quickly into the public market," said Scott Crowe, a portfolio manager with Resource Real Estate in New York, a firm that buys real estate and invests in shares of nontraded REITs on the secondary market. "I think [deals] still make sense in places like the health-care space where there's a long history of those companies trading at a premium" to the value of their assets.
The article fails to mention that Resource Real Estate, in addition to investing in non-traded REITs on the secondary market, also offers its own multi-family non-traded REIT.

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