KBS Real Estate Investment Trust II Inc., a publicly registered non-traded REIT, reported in an SEC filing that CMG Partners completed its unsolicited tender offer. The offer resulted in CMG purchasing 263,882 shares of the REIT’s common stock at a purchase price of $3.30 per share. CMG paid approximately $871,000 for the tendered shares.
Following this purchase, CMG Partners now owns a total of approximately 998,632 shares of KBS REIT II common stock, or approximately 0.53 percent of the total outstanding shares. They originally offered to purchase up to 9.75 million shares of common stock totaling $32.2 million, as reported by The DI Wire in May.
In the original letter to REIT shareholders, CMG noted that if investors tendered their shares, they could cash out with total distributions and proceeds in excess of their initial investment. However, the REIT recommended that shareholders reject the offer stating that the price is significantly less than the current and potential long-term value of the shares.
KBS REIT II estimates that its net asset value is $5.62 per share, and previously disclosed that it intends to sell assets in its portfolio and engaged a third party firm to provide assistance with potential strategic alternatives.
KBS REIT II went effective in April 2008 and closed its offering in December 2010 after raising $1.8 billion in investor equity. Shares were originally purchased for $10.00 each, and the company paid a special distribution of $4.50 per share in September 2014. The REIT’s portfolio consists of 11 real estate properties and one real estate loan receivable.