REITs Raise Millions for Mortgage Asset Investment
Real estate investment trust (REIT) activity is picking up as investors look to take advantage of the glut of distressed assets hitting the market. A trio of REITs launched initial public offerings (IPOs) this summer and raised millions for their investment ventures. Invesco Mortgage Capital (IVR) raised $201m in July through a public and private offering to invest in agency residential mortgage-backed securities (RMBS), non-agency RMBS, CMBS and residential and commercial mortgages. Starwood Property Trust (STWD) raised $952m from its public and private offerings. PennyMac Mortgage Investment Trust (PMT) had a $325m IPO this summer to purchase residential mortgage loans and other mortgage-related assets. On Friday, two more REITs filed Securities and Exchange Commission (SEC) briefs announcing IPOs as well. But the activity isn’t limited to the US. Canadian REIT InterRent Real Estate Investment Trust announced Monday it completed a private placement of 9.3m units at a price of C$1.50 (US$1.39) per unit for total gross proceeds of C$14m. In the UK, Hansteen Holdings announced its intentions to transition from a property company to a REIT. The move will likely require a number of amendments to Hansteen’s articles of association and will have tax implications for the firm. But as more REITs are getting into the market, some are reducing asset inventory. Alstria Office REIT, which acquires, owns and manages office real estate in Germany, announced Monday it will sell three Hamburg office buildings with a combined 6,000 square meters of rental space for €15.5m (US$22.5m), a premium of 5%, the company announced. Write to Austin Kilgore.