American Realty Capital Trust V (ARCT V) recently revealed an estimated net asset value of $23.50 per share of its common stock was approved by its board of directors.
Previously, the average price paid for outstanding shares of common stock was $24.70 per share, which reflects issuances under the DRIP and volume discounts.
Nick Radesca, Chief Financial Officer of the Company, commented, “By announcing estimated per-share NAV consistent with the process set out in our prospectus – four months in advance of current industry guidelines and before the required implementation date for the newly-approved FINRA 2014-006 – ARCT V is leading the direct investment space by example: facilitating a better alignment of interests among management, advisors and shareholders.”
William M. Kahane, President and Chief Operating Officer of ARCT V, added, “This is a very exciting next step in American Realty Capital Trust V’s value creation journey. It’s important to note that the NAV estimate of $23.50 per share does not reflect ‘enterprise value’ which may include an adjustment for: the large number of the Company’s real estate assets, given that some buyers may be willing to pay more for a large portfolio than they are willing to pay for each property in the portfolio separately; any other intangible value associated with a going concern, or; the possibility that the Company’s shares could trade at a premium or a discount to NAV if the shares were listed on a national securities exchange.”
There were whispers of a liquidity event for ARCT V over the summer when the company announced that it had enlisted the aid of JP Morgan Securities, LLC and RCS Capital to evaluate strategic alternatives.
Launched in 2013 with a focus on investing in freestanding single-tenant retail properties that are net leased to investment grade and other creditworthy tenants, ARCT V has realized quick success. As of September 30, 2014, the company owned 463 properties with an aggregate purchase price of $2.2 billion.