The board of Hartman Short Term Income Properties XX Inc., a publicly registered non-traded real estate investment trust, has formed a special committee to explore the possibility of converting the company from a traditional non-traded REIT to a perpetual life non-traded net asset value REIT.
The company noted that the special committee will consider several options to provide liquidity to their investors, including modifying its share redemption program to allow redemptions at NAV per share.
Another affiliated REIT, Hartman vREIT XXI Inc., also formed a special committee to discuss potential liquidity options, including a possible merger into Hartman XX.
Hartman cautioned that no final determinations have been made and the establishment of committees to explore options is preliminary. Any potential merger between the companies will require registration with the Securities and Exchange Commission and other regulators.
“The adoption of a perpetual life or NAV REIT model makes a lot of sense for our investors and for us as a sponsor. As an investor in value-oriented commercial real estate in Texas, it allows us to do what we do best—own and operate commercial real estate while providing ongoing liquidity to our investors,” said Al Hartman, chairman and chief executive officer.
In related news, Hartman XX expects its merger with two affiliated non-traded REITs, Hartman Income REIT and Hartman Short Term Income Properties XIX, will close in the early third quarter of 2020 after shareholders approved the proposal back in May 2020. Hartman XX will be the surviving entity and will have a combined asset value of approximately $655 million, the company said.
This week, The DI Wire reported that Hartman vREIT XXI amended its registration statement to add two new share classes, Class I and Class S shares.
Hartman acquires, owns, manages, and leases commercial office, retail, light industrial and warehouse properties located in Texas. Since 1983, the firm and its affiliated entities have sponsored 23 programs and acquired interests in more than 90 real assets totaling approximately $750 million as of December 31, 2019.