The board of Inland Real Estate Income Trust Inc., a publicly registered, non-traded real estate investment trust, has determined an estimated net asset value per share of $19.86 as of Dec. 31, 2022.
The REIT’s previous NAV per share was $20.20 as of Dec. 31, 2021.
The NAV per share is based on the estimated value of the company’s assets, less the estimated value of its liabilities divided by the number of outstanding shares, all as of Dec. 31, 2022.
CBRE Capital Advisors Inc., a third-party firm, assisted with the valuation process and determined an NAV per share range of $19.40 to $21.82, with a mid-point of $20.61.
Shares were originally sold for $10.00 each, but the company conducted a 1-for-2.5 reverse stock split in 2018, resulting in a final offering price of $25.00 per share.
In a recent filing with the SEC, Inland REIT indicated that the primary factors contributing to the change in the NAV was primarily due to an increase in the value of their interest rate swap derivatives which they believe resulted from an increase in interest rates.
As of Dec. 31, 2022, the REIT’s portfolio was 93.5% occupied, compared to 93.3% last year. The company acquired seven grocery-anchored shopping centers and one additional shopping center in May 2022. However, approximately 32% of their annualized base rent for leases in-place as of Dec. 31, 2022, was still from non-grocery big box retailers.
The company shared that four big box spaces leased by Bed Bath & Beyond at their properties is expected to close in 2023 and that Party City filed for Chapter 11 bankruptcy in January 2023, and is negotiating with Inland to try to modify their leases at four locations.
“In light of the challenges and uncertainties surrounding big box retailers, the risk of an economic recession in the United States and the increased financing costs from higher interest rates resulting in lower demand, lower transaction volume and lower prices for retail shopping centers, among other factors, the board selected an estimated per share NAV of $19.86 that is below the mid-point of the range in the Valuation Report,” the company stated.
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