NJ-Based Net Lease REIT Raises $455 Million in IPO

Single-Tenant Specialist Necessary Properties Gets Everything from Motion Picture Theaters, Fast-Food and Cars And Truck Cleans to ER Centers

Cushman & Wakefield isn’t really the only commercial real estate firm testing the general public markets this week. Important Characteristic Realty Trust, Inc., a real estate financial investment trust that owns and handles triple-net, single-tenant business properties, raised $455 million by providing 32.5 million shares at $14.

The $14 per-share offering was at the low end of exactly what the business hoped to raise, which was net proceeds of $542.7 million at $17 a share. The shares began trading Thursday on the New York Stock Exchange under the sign EPRT priced at $13.61 in after-hours trading and were trading in roughly the same range Friday morning.

With the conclusion of the offering, Princeton, NJ-based Essential Properties will sell 7.79 million shares of typical stock and 1.14 million common systems in the company’s operating partnership in a personal placement to a subsidiary of Eldridge Industries, LLC, the business’s main equity service provider, for $125 million.

The business plans to use the net earnings and the personal positioning to repay about $288 million in payable notes and for basic business functions, consisting of possible future financial investments.

Goldman Sachs & & Co. LLC and Citigroup are functioning as lead book-running supervisors for the offering and as representatives of the underwriters, Barclays, BofA Merrill Lynch and Credit Suisse are acting as joint book-running supervisors for the offering.

The company’s first purchase was the June 2016 acquisition of a portfolio of 262 net-leased properties, primarily restaurants, offered as part of the liquidation of General Electric Capital for $280 million.

The business’s residential or commercial properties include restaurants, car cleans, automotive services, medical services, convenience stores, entertainment, early youth education, health, and physical fitness.

As of March 31, Important had a portfolio of 530 properties, 99.1 percent occupied by 127 tenants in 15 markets throughout 42 states. None of its tenants contribute more than 6.8 percent of its overall yearly base rent, and the typical staying lease term is a strong 13.8 years, with less than 4.5 percent of leases ending prior to 2023.

More than 95 percent of leases providing for increases in future base lease at a weighted average rate of 1.5 percent per year. 64.8 percent of the base rent was attributable to master leases.

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