Griffin Capital Essential Asset REIT Updates NAV, Reinstates Distribution Reinvestment Plan
July 20, 2020 | Luke Schmidt | Blue Vault
On July 16, 2020, Griffin Capital Essential Asset REIT, Inc. (“GCEAR”) announced an updated NAV per share of $8.86 as of June 30, 2020, a decrease from the previously announced NAV per share of $9.30 as of March 31, 2020. The drop in NAV is largely attributed to the COVID-19 pandemic and its impact on commercial real estate markets, which resulted in changes to cash flow assumptions for some of the Company’s properties. Changes included a reduction in certain market rent growth assumptions and an increase in downtime for certain vacant properties.
The board of directors of GCEAR also determined to reinstate the distribution reinvestment plan (“DRP”), effective July 27, 2020, and to amend the DRP to allow for the use of the most recently published NAV per share at the time of reinvestment as the DRP purchase price. The Company had previously suspended the DRP effective March 8, 2020 in connection with a potential strategic transition. Stockholders previously enrolled in the DRP will be automatically reinstated in the DRP.
The Company also announced a partial reinstatement of the share redemption program (“SRP”), effective August 17, 2020. The SRP will be reinstated for redemptions sought upon a stockholder’s death, qualifying disability, or determination of incompetence or incapacitation. Regular redemptions remain suspended. The Company’s quarterly cap on aggregate redemptions will be equal to the aggregate NAV, as of the last business day of the previous quarter, of the shares issues pursuant to the DRP during that quarter.
As of March 31, 2020, GCEAR reported total assets of approximately $4.2 billion with total real estate assets of approximately $3.6 billion. The Company’s portfolio consisted of 100 properties in 25 states consisting primarily of office, warehouse, and manufacturing facilities. As of March 31, 2020, the properties were 89.0% leased.
Source: SEC, Blue Vault
