Full-Cycle Listings & Events in Q1 2017
Each quarter Blue Vault includes a section in the Nontraded REIT Industry Review dedicated to funds that have gone full-cycle.
The tables included are intended to track those nontraded REITs that have liquidated, merged or been acquired by listed companies whose share prices can be observed. The first table tracks the subsequent performance of listed common stock that is associated with a full-cycle event where shareholders received listed common stock in exchange for their holdings in a nontraded REIT. The first table is not a complete listing of all nontraded REIT liquidity events. It does not include liquidity events that involved a combination of cash and listed shares where it would be misleading to measure the percentage change for only a portion of the shareholder’s value received.
New this quarter, we’ve added a second table which lists full-cycle events that resulted in a liquidating distribution of cash wherein shareholders did not receive listed common stock as all or part of the proceeds.
The values of the listed stocks and the percentage changes in those stocks do not represent the total returns or average annual rates of return to shareholders in these companies because quarterly distributions to shareholders are not included. The estimated full-cycle values listed in the second table also do not include distributions to shareholders during their holding periods. In the Blue Vault Full-Cycle Performance Studies, the average total returns to shareholders for all of the events listed in both tables, are reported for three different holding periods and compared to custom benchmarks. The custom benchmarks for each full-cycle REIT are based on both listed REIT returns and institutional portfolio returns, adjusted for asset types, location and leverage.
In our Full-Cycle Performance Studies, Blue Vault defines a “full-cycle event” for the purpose of calculating total returns to shareholders over the life of the nontraded REIT as those events that provide total liquidity to common shareholders which can be in cash or publicly-traded stock or a combination of both. When a nontraded REIT is merged with a company whose stock is unlisted, or when a liquidity event includes both unlisted stock and cash, or when, for any other reason shareholders cannot achieve full liquidity at the time of the merger or listing (i.e. when not all common share classes are listed immediately), the shareholder return cannot be calculated.
Blue Vault will release its Fifth Edition Nontraded REIT Full-Cycle Performance Study in November 2017.
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Nontraded REIT Review Q1 2017 - Full-Cycle Listings and Events
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