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NorthStar Real Estate Income Trust Announces $9.92 NAV

April 17, 2017

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NorthStar Real Estate Income Trust Announces $9.92 NAV

April 18, 2017 | by James Sprow | Blue Vault

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On April 11, 2017, the board of directors of NorthStar Real Estate Income Trust (“NorthStar Income”), including all of its independent directors, approved and established an updated estimated value per share of NorthStar Income’s common stock of $9.92. The estimated value per share is based upon the estimated value of NorthStar Income’s assets less the estimated value of NorthStar Income’s liabilities as of December 31, 2016, divided by the number of shares of NorthStar Income’s common stock outstanding as of December 31, 2016. The information used to generate the estimated value per share, including market information, investment and property-level data and other information provided by third parties, was the most recent information practically available as of December 31, 2016.

In accordance with the terms of NorthStar Income’s distribution reinvestment plan, effective immediately, distributions may be reinvested in shares of NorthStar Income’s common stock at a price of $9.92, which is equal to the estimated value per share as of December 31, 2016, until such time as NorthStar Income establishes a new estimated per share value, at which time the purchase price will adjust to 100% of such new estimated value per share.

The estimated value per share was calculated with the assistance of NorthStar Income’s external advisor, CNI NSI Advisors, LLC , and Duff & Phelps, LLC, an experienced third-party independent valuation and consulting firm engaged by NorthStar Income to assist with the valuation of its assets and liabilities.

Previously, on April 7, 2016, upon the recommendation of the Audit Committee, the Board, including all of its independent directors, approved and established an estimated value per share of NorthStar Income’s common stock of $9.87 as of December 31, 2015.

The process for estimating the value of NorthStar Income’s assets and liabilities was performed in accordance with the provisions of the Investment Program Association Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs. NorthStar Income believes that the valuation process was developed in a manner reasonably designed to ensure its reliability and is not aware of any changes subsequent to December 31, 2016 that would have a material impact on its overall valuation.

On April 11, 2017, Duff & Phelps delivered its report related to the valuation of NorthStar Income’s assets and liabilities as of December 31, 2016, including NorthStar Income’s 20 CRE debt investments, nine CRE property investments comprised of 42 individual properties, three portfolios of private equity real estate fund interests, 11 commercial mortgage-backed securities and 16 CRE-related liabilities.

Based on the above valuations and estimates and subject to the assumptions and limiting conditions contained in its report, Duff & Phelps estimated that the net asset value per common share outstanding of NorthStar Income’s common stock as of December 31, 2016 ranged from $9.42 to $10.17 per share. Based on its review of the Duff & Phelps report and the analysis and recommendation of the Advisor, the Audit Committee recommended and the Board approved an estimated net asset value per share of $9.92.

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Ramón A. Rivera-Ramos
Blue Vault Nontraded REIT and Nontraded BDC Reviews
September 1, 2016

Blue Vault helps me to stay well informed on the financial status of both open and closed nontraded REITs and BDCs, so that I can help my clients better understand the product, before they make the decision to invest and after.