October 2020 Nontraded REIT Capital Raise Increases 38.5% for Reporting Offerings

November 12, 2020 | James Sprow | Blue Vault

Blue Vault received October sales totals for 12 effective nontraded REIT program offerings as of November 11. Sales reported by those 12 NTRs totaled $169.89 million compared to $122.77 million for September, an increase of $47.12 million, or 38.4%. This rate of increase was almost identical to the rate of increase between August and September of 38.5%. Four additional nontraded REITs have previously suspended their offerings or did not report sales for October (Griffin Capital Essential Asset REIT, InPoint Commercial Real Estate Income, Moody National REIT II, and Strategic Storage Trust IV).

Jones Lang LaSalle’s Income Property Trust’s offering led the 12 reporting NTRs with sales of $68.78 million, up from $23.97 million in September, bringing the REIT’s ten-month total sales to $337.7 million, up 23% from the first ten months of 2019 when the REIT raised $274.4 million. Black Creek Group’s Black Creek Industrial REIT IV raised $43.68 million in October, down 9.4% from $48.21 million in September, and second among the 12 reporting NTRs. Hines Global Income Trust had $19.25 million in sales for October, up 11.5% from September’s total of $17.27 million. FS Investments raised $16.83 million for its FS Credit Real Estate Income Trust, up 25.0% from its September total of $13.46 million. Four of the 12 reporting nontraded REITs had decreases in sales in October. All sales reported include distributions reinvested in shares of the REIT (DRIP).

Table I shows month-to-month comparisons for those REITs reporting sales for October.

Table I

Table II shows October Y-O-Y comparisons for 18 nontraded REITs that have reported sales in both October 2019 and October 2020.  The largest Y-O-Y increases among those REITs that were raising capital in October 2020 were for Black Creek Industrial REIT IV (up 219%) and Jones Lang LaSalle Income Property Trust (up 39%).

Table II 

Nontraded BDC Sales

Just three nontraded BDCs were raising funds in October 2020 and reported those sales to Blue Vault. Owl Rock Capital Corporation II raised $21.83 million, up 4.9% from $20.81 million in September. MacKenzie Realty Capital reported nontraded BDC sales in October of $48,700, up 87% from $26,000 in September. Triton/Prospect’s TP Flexible Income Fund reported sales for October of $25,000 compared to $95,000 for September.  The total capital raise reported by three nontraded BDCs for October 2020 was $21.91 million compared to $20.93 million reported by those same BDCs for September, a modest increase of 4.7%.

Nontraded Preferred Stock Issued by Reporting Sponsors

Five listed REITs reported their nontraded preferred stock issuances in October to Blue Vault, with one additional sponsor reporting that hadn’t previously reported. Bluerock Residential Growth REIT issued $28.16 million of its preferred stock in October, up 7.7% from $26.14 million in September. CIM Commercial Trust issued $3.01 million of its nonlisted preferred in October, up from its September total of $2.81 million. Preferred Apartment Communities issued $16.90 million in three series of preferred shares in October, up 5.6% from the $16.00 million issued in September. Gladstone LAND and Gladstone GOOD issued a total of $3.67 million in nontraded preferred in October, up from $2.41 million in September. Prospect Capital issued $2.00 million of nontraded preferred in October and reported those sales to Blue Vault for the first time.  Altogether, the six companies including Prospect Capital reported issuing $53.73 million in nontraded preferred shares in October, up 13.4% from the total for five REITs of $47.37 million in September.

Table III

Source:  Blue Vault