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Nontraded REIT Sales Slide in January 2017 While BDC Sales Edge Upward

February 13, 2017

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Nontraded REIT Sales Slide in January 2017 While BDC Sales Edge Upward

February 13, 2017 | by James Sprow | Blue Vault

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Equity capital raised by open nontraded REIT programs in January 2017, appear to have fallen 24% from December 2016, according to sales figures reported by Blue Vault. The 27 effective nontraded REITs, sales for all share classes, including DRIP proceeds, totaled $273 million in January 2017, compared to $359 million in December 2016. A new entrant, Blackstone Real Estate Income Trust, Inc., was not included in the reported totals. In an 8-K filing with the SEC on January 4, Blackstone reported breaking escrow with $279 million in IPO proceeds, all in Q4 2016. If Blackstone REIT had sales comparable to their pace in Q4 2016, the industry nontraded REIT sales in January would be higher by a significant amount. Still, compared to January 2016, nontraded REIT capital raise for effective programs, excluding Blackstone REIT, were down 32% year-over-year.

The top five programs raising equity capital in January 2017 were:

Griffin Capital Essential Asset REIT II, Inc. $38,338,081
(Intentionally left blank) $35,589,856
Carter Validus Mission Critical REIT II, Inc. $21,257,123
Griffin-American Healthcare REIT IV, Inc. $19,288,927
Industrial Property Trust, Inc.  $18,037,490

 

BDCs showed a slight 3% increase in sales, from $70.1 million in December 2016 to $72.4 million in January 2017. The top five BDC programs raising equity capital in January 2017 were:

FS Investment Corporation IV  $23,680,000
(Intentionally left blank) $16,333,156
FS Investment Corporation III  $11,530,000
HMS Income Fund, Inc. $5,832,251
Corporate Capital Trust II, Inc.  $4,983,197

 

Blue Vault compiles sales each month for nontraded REITs, BDCs, Closed End Funds, Private Placements and Interval Funds. Reported sales are verified each quarter for any program that files financial reports with the SEC. The reported figures are estimates and should not be relied upon as 100% accurate.

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John E. Moriarty, ChFC
December 2015
February 3, 2016

I have been in the financial services industry for 20 years and our firm provides an education platform that gets clients to “think differently” about their financial picture.  For many years we have communicated to clients the need to diversify their portfolios using alternative asset classes and more specifically, private non-traded investments.  Due diligence on these types of financial vehicles is essential and when I learned about Blue Vault in 2010, our firm immediately began using their material as a tool to build confidence in the minds of our advisors on which alternatives to recommend to clients.  I am impressed with the way Blue Vault continues to add value to their subscribers and I view their publication as a tremendous resource in today’s complex world.