Looking to Raise Funds for Bargain Buys, CBRE Trust Declares Offering
- Feb 24, 2009
With an eye toward an investment market with drastically reduced pricing, CB Richard Ellis Realty Trust has joined the ranks of firms looking to buy. To that end, the REIT has announced its second public offering, with the goal of raising up to $3 billion to invest in commercial property in the United States and abroad. The offering will consist 90 percent of shared priced at $10.00, and 10 percent priced at equal to or higher than $9.50 per share. The common shares will be offered through CNL Securities Corp. until Jan. 20, 2011, unless extended. The REIT said it intends to use the funds raised from the offering to acquire office, retail, industrial and multi-family assets in major American markets, as well as up to 30 percent in international properties. The firm is far from alone in looking to take advantage of an investment market that has seen prices plummet in the struggling economy. Just last week, Spectrum Properties established a subsidiary that aims to acquire between $200 million and $500 million worth of apartment communities and student housing properties. And a report released last week by services firm Jones Lang LaSalle said that, for firms with enough cash on hand to make acquisitions despite the credit freeze, the reduced prices and lesser competition for investments could lead to historically attractive bargains for high quality properties. While the time frame is anything but definite, $300 billion worth of loans are due to mature each year through 2012; and with refinancing options greatly reduced, there will likely be no shortage of distressed sellers willing to accept lower prices for properties. CB Richard Ellis Realty Trust is a REIT sponsored by CB Richard Ellis Investors L.L.C. Formed in 2004, the REIT made its first public share offering in November 2006, when it offered $2 billion in common shares.