February 2021 Nontraded REIT Capital Raise Decreases 12% for Reporting Offerings

March 18, 2021

February 2021 Nontraded REIT Capital Raise Decreases 12% for Reporting Offerings

March 18, 2021 | James Sprow | Blue Vault

Blue Vault received February sales totals for 10 effective nontraded REIT program offerings as of March 15, 2021. Sales reported by those 10 NTRs totaled $120.85 million compared to $137.73 million for the same 10 reporting REITs in January, a decrease of $16.88 million, or 12.3%. Cantor Fitzgerald has yet to report the February sales for their two sponsored nontraded REITs. Cottonwood Communities did not have sales in February. Four additional nontraded REITs have previously suspended their offerings or did not report sales for February (Griffin Capital Essential Asset REIT, Hartman vREIT XXI, Moody National REIT II, and Strategic Storage Trust IV).

Black Creek Industrial REIT IV’s offering led the 10 reporting NTRs with sales of $33.52 million, down 10% from $37.23 million in January. Nuveen Global Cities REIT raised $30.52 million in February, up 248% from $8.78 million in January. Jones Lang LaSalle Income Property Trust raised $19.14 million, up 48% from January when it raised $12.95 million. All sales reported include distributions reinvested in shares of the REIT (DRIP).

Table I shows month-to-month comparisons for those REITs reporting sales for February 2021.

Table I

Table II shows February Y-O-Y comparisons for 17 nontraded REITs that have reported sales either in February 2020 or January 2021 or both. The only Y-O-Y increases among those REITs that were raising capital in January 2021 were for Black Creek Diversified Property Fund (up 1154%) and Nuveen Global Cities REIT (up 56%).

Table II 

Nontraded BDC Sales

Just one nontraded BDC was raising funds in January 2021 and reported sales to Blue Vault. Owl Rock Capital Corporation II raised $19.68 million, up 1.3% from $19.44 million in January. MacKenzie Realty Capital reported nontraded BDC sales in October 2020 of $48,700 but did not report sales for November thru February.  Triton/Prospect’s TP Flexible Income Fund reported sales for October 2020 of $25,000 but did not report sales for November thru February. The total capital raise reported by the only nontraded BDC for January 2021 was $19.68 million, all by Owl Rock Capital Corporation II compared to $58.42 million reported by two BDCs for February 2020, a decrease Y-O-Y of 67%.

Nontraded Preferred Stock Issued by Reporting Sponsors

Five listed REITs reported their nontraded preferred stock issuances in February 2021 to Blue Vault. Bluerock Residential Growth REIT issued $31.00 million of its preferred stock in February, up 4% from $29.82 million in January. Preferred Apartment Communities issued $21.73 million in two series of preferred shares in February, up 34.4% from the $16.17 million issued in January. Prospect Capital issued $6.57 million of nontraded preferred in February, up 102% from $3.25 million issued in January. Gladstone LAND and Gladstone GOOD issued a total of $4.68 million in nontraded preferred in February 2021, up from $3.15 million in January. Altogether, the five companies reported issuing $66.07 million in nontraded preferred shares in February, up 26% from the total for the six listed REITs of $52.39 million in January. In February 2020, five listed REITs reported sales of $62.89 million in nontraded preferred stock, for a Y-O-Y increase of 5.1% for February 2021. 

Table III

Source: Blue Vault

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Gil Armour, CFP
February 3, 2016

I have been using Blue Vault Partners for the past five years.  I have found them to be a valuable, unbiased resource when it comes to evaluating and comparing non-traded REITs.  The reports help me analyze which sponsors are doing a responsible job of managing their offerings.  This allows me to limit my REIT recommendations to only the most competitive products, and then track those REITs throughout their life cycle.