The board of InvenTrust Properties Corp., a publicly registered non-traded real estate investment trust, has approved a new estimated net asset value per share of $3.14 for the company’s common stock of as of May 1, 2018. The new $3.14 NAV per share represents a 4.6 percent decrease over the previous estimated per share value of $3.29 as of May 1, 2017.
Duff & Phelps, a third-party valuation advisory firm, assisted with the valuation process and provided a value range of $3.00 to $3.29 per share. The mid-point in that range was $3.14.
The per share NAV was based on the estimated market value of the company’s assets, less the estimated market value of its liabilities, divided by the total shares outstanding, and was performed in accordance with Institute of Portfolio Alternatives (IPA) valuation guidelines.
In a letter to shareholders, the company explained that the decline was driven by significant store closings by apparel-based retailers and department stores, as well as internet sales. “These elements contributed to a negative perception of the retail sector by the investment community, which slowed investments and money flow into retail real estate,” the company said in the letter.
Grocery-anchored neighborhood centers without multiple big box apparel retailers largely retained their value, and the company continues to focus on these assets in markets with above average wage and population growth, particularly the Sun Belt region.
InvenTrust Properties, formerly known as Inland American Real Estate Trust, focuses on open air retail centers in growth markets. The offering was declared effective in August 2005 and closed in April 2009 after raising $8.4 billion, according to Summit Investment Research. The company became a self-managed REIT in 2014 and oversees a $3.9 billion portfolio of 71 retail properties, as of the fourth quarter of 2017, according to Summit Investment Research.