REIT - May/June 2010

2009-2010 REIT IPOs Company

Ticker

GOV CYS IVR PMT STWD CXS CLNY ARI PEB CHSP PDM TRNO CLDT EXL

Property Sector

Office Mortgage Mortgage Mortgage Mortgage Mortgage Mortgage Mortgage Lodging Lodging Office Industrial Lodging Retail

Chairman

Barry M. Portnoy Kevin E. Grant Neil Williams Stanford L. Kurland Barry S. Sternlicht Patrick Corcoran Thomas J. Barrack Henry R. Silverman Jon E. Bortz James Francis Wayne Woody Blake Baird Jeffrey Fisher Gary Sabin

IPO Date

6/2/09

6/1//09

6/26/09

7/29/09

8/11/09

9/16/09

9/23/09

12/8/09

1/21/10

2/10/10

4/15/10

4/22/10

Shares (million)

10.00

9. 10

8. 50

14. 71

40. 50

13. 33

12. 50

10.00

17. 50

7. 50

12.00

8. 75

8. 63

15.0

Offering Price

$20.00

$11.00

$20.00

$15.00

$20.00

$14.50

$20.00

$14.00

Total Raised ($mil)*

$230.00

$115.12

$365.50

$338.25

$415.63

$230.00

$287.50

$230.00

$402.50

$172.50

$200.10

$201.25

$172.50

$210.00

market for acquisitions will be more competitive. As a result, the
blind-pool model makes less sense.”
Fasulo notes that the big banks that were saved by taxpayer
dollars remain the biggest property owners, and now they are
flush with cash. Instead of blind pools, Fasulo says investors
should be looking for IPOs from REITs with existing assets and
strong management teams in place.

If IPOs are getting delayed nowadays, “then the demand just
isn’t there,” according to Fasulo. Furthermore, if investors are
paying more per share than the company has in cash on hand,
Fasulo warns that “they are making a mistake.”
Mueller maintains that “semi-blind pools,” which already have
acquisitions identified or under contract, stand a better chance of
success going forward than full-on blind pools.

For example, Chatham Lodging Trust (NYSE:CLDT), which had agreements to purchase several hotels at the time of its April 15 offering, received the full amount it was seeking in its IPO.

Strong Demand in the Pipeline

As the economy continues to lurch out of the recession, “demand for more REIT IPOs, blind pool and otherwise, should continue so long as there is an effective and efficient public-private arbitrage taking place where pricing is concerned,” Cicco says. In some cases, private REITs and private equity real estate groups contemplating IPOs will more than likely be gobbled up through mergers and acquisitions, he adds.

Based on filings with the SEC, the IPO pipeline for 2010 is
building. Among the various sectors, office REIT IPOs may be
poised for an uptick this year. Industry mavens Dick Ziman and
Victor Coleman, formerly of Arden Realty Inc., are working on
separate deals, but they have not been able to pull the trigger
because the market still views the sector as a laggard.