Corporate Property Associates 18 – Global Announces NAV Change
June 1, 2018 | James Sprow | Blue Vault
Corporate Property Associates 18 – Global Incorporated announced on May 30 that its estimated net asset values per share (“NAVs”) as of March 31, 2018, was $8.57 per share for both Class A common stock and Class C common stock, which were 2.5% higher than the NAVs at December 31, 2017, of $8.36. The increase in NAVs is primarily due to the appreciation of the real estate portfolio.
The NAVs of $8.57 for both Class A common stock and Class C common stock will continue to be used for redemptions of common stock, issuing shares pursuant to the distribution reinvestment plan and the payment of the distribution and shareholder servicing fee for the Class C common stock.
March 31, 2018, NAVs were calculated by the advisor in accordance with current valuation policies, in which the REIT obtains an independent rolling appraisal of the fair market value of approximately 25% of its real estate portfolio based on asset value once every quarter. The portfolio of assets to be appraised each quarter will be representative of the composition, by both geography and property type, of the entire portfolio. For each quarterly NAV calculation, the REIT also updates the latest independent real estate portfolio valuations for the following:
•Adding new acquisitions at their appraised value at acquisition
•Adding build-to-suit investments not included in the independent real estate portfolio at their latest quarterly carrying values for in-process projects or with third party appraised value for any completed projects
•Updating the value of any property that the advisor deems to have had a significant event during the quarter
•Removing assets that were disposed of during the quarter
The REIT also obtains an updated independent valuation of its debt as of quarter end, makes adjustments for other intangible balance sheet assets and liabilities at quarter end, uses total shares outstanding for each class of shares, and uses foreign exchange rates as of quarter end in converting the local currency fair market value of international assets and liabilities to U.S. dollars.
The methodology of determining the quarterly NAVs conforms to the Investment Program Association’s Practice Guideline for Valuations of Publicly Registered Non-Listed REITs (April 2013) and fair value accounting standards under generally accepted accounting principles in the United States.
At March 31, 2018, the fair market value of the REIT’s real estate portfolio and the notes receivable was $2.45 billion. In calculating the NAVs, the advisor relied in part on the Update Appraisals and the March Update Appraisal, as well as the updated estimates of the fair market value of debt as of March 31, 2018, all provided by Robert A. Stanger & Co., Inc., an independent consultant and service provider to the real estate industry.
Blue Vault’s Q1 2018 NTR Industry Review reports that Corporate Property Associates 18 – Global Incorporated at March 31, 2018, had a net lease portfolio comprised of full or partial ownership interests in 59 properties, which include multi-tenant properties, substantially all of which were fully occupied and triple-net leased to 100 tenants, and totaled approximately 10.2 million square feet. The remainder of the portfolio at that date was comprised of full or partial ownership interests in 69 self-storage properties and 11 multi-family properties totaling 6.7 million square feet.
On March 8, 2018, the Company entered into a build-to-suit joint venture with a third party for a student-housing development site located in Barcelona, Spain at a total cost of $10.5 million. The Company acquired 99% of the equity in this investment at closing. This property is under construction and is currently projected to be completed in September 2019, at which point, the total investment is expected to be approximately $28.5 million.
As of December 31, 2017, the occupancy rates were as follows: Single-tenant 98.3%, Multi-tenant 97.2%, Self-storage 90.4%, Multi-family 93.5%.
Source: SEC, Blue Vault
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