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Oaktree’s Nontraded REIT Program Public Offering Status

April 24, 2019

Oaktree’s Nontraded REIT Program Public Offering Status

April 24, 2019 | James Sprow | Blue Vault

Oaktree Real Estate Income Trust, Inc. was formed on July 27, 2017. The Company was organized to invest primarily in well-located, high quality commercial real estate assets that generate strong current cash flow and could further appreciate in value through moderate leasing and repositioning strategies. The Company will be externally managed by Oaktree Fund Advisors, LLC, an affiliate of Oaktree Capital Management, L.P. On January 9, 2018, the Company was capitalized with a $200,000 investment by an affiliate of the Adviser.

As of December 31, 2018, the Company had not commenced its principal operations and had neither purchased nor contracted to purchase any investments. In a February 5 filing, the REIT stated:  “We will not sell any shares of our common stock in this offering unless (1) we receive purchase orders for at least $150,000,000, including shares purchased by Oaktree, its affiliates and our directors and officers, in any combination of purchases of shares of any class of our common stock on or before February 15, 2020 and (2) our board of directors has authorized the release to us of funds in the escrow account prior to such date.”

Related: Oaktree REIT Acquires $59 Million Apartment Property in Georgia

The Company has registered with the Securities and Exchange Commission, an offering of up to $1,600,000,000 in shares in its primary offering and up to $400,000,000 in shares pursuant to its distribution reinvestment plan. The Company intends to sell any combination of the four classes of shares of its common stock, Class T shares, Class S shares, Class D shares, and Class I shares, with a dollar value up to the maximum offering amount. The share classes have different upfront selling commissions and ongoing stockholder servicing fees. Until the release of proceeds from escrow, the per share purchase price for shares of the Company’s common stock in its primary offering will be $10.00 per share plus applicable upfront selling commissions and dealer manager fees. Thereafter, the purchase price per share for each class of common stock will vary and will generally equal the Company’s prior month’s net asset value (“NAV”) per share, as determined monthly, plus applicable upfront selling commissions and dealer manager fees. The Company will accept proceeds and hold investors’ funds in an interest bearing escrow account until (i) the Company receives purchase orders for at least $150,000,000, including shares purchased by the Company’s sponsor, its affiliates and its directors and officers, in any combination of classes of shares of our common stock, and (ii) the Company’s board of directors has authorized the release of funds in the escrow account. As of December 31, 2018, neither the Company nor its escrow agent received any purchase orders or investor funds from the Offering.

On April 11, 2019, the Company partnered with TruAmerica Multifamily, LLC in a joint venture to acquire Anzio Apartments in Lawrenceville, Georgia, for $59.2 million. The property is a 448-unit multifamily asset. The purchase was financed with $44 million of property-level debt from FHLMC. The Company also entered into a line of credit on that date with Oaktree Fund GP I, L.P. for a principal amount up to $150 million. 

Source:  SEC

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Loreen M. Gilbert, CIMA, AIF, CRC, CLTC – President, WealthWise Financial Services
Blue Vault
July 6, 2016

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