The board of KBS Strategic Opportunity REIT Inc., a publicly registered non-traded real estate investment trust, approved a $14.81 per share net asset value of the company’s common stock, as of September 30, 2016. The new estimated NAV is an increase of 10.2 percent compared to last year’s valuation of $13.44. Shares were originally sold for $10.00 each.
The valuation is based on the estimated value of the company’s assets, less the estimated value of the its liabilities, divided by the number of shares outstanding.
Duff & Phelps and Landauer Services, two independent third-party valuation firms, performed appraisals on properties owned by the REIT. The estimated value per share was based upon the recommendation and valuation prepared by KBS Capital Advisors LLC, the REIT’s advisor.
The REIT’s conflicts committee, composed of independent directors, was responsible for the oversight of the valuation process and concluded that the estimated value per share proposed by the advisor was reasonable, and recommended the board adopt $14.81 as the estimated value per share of the company’s common stock.
As of September 30, 2016, KBS Strategic Opportunity REIT owned 20 real estate assets with an estimated value of $1.65 billion. The total cost of the properties was $1.32 billion, which includes the acquisition cost of $1.14 billion, $38 million for the acquisition of minority interests in joint ventures, $133.1 million in capital expenditures, leasing commissions and tenant improvements since inception, and $17.3 million in acquisition fees and expenses. The total estimated real estate value compared to the total acquisition cost plus capital improvements is an overall increase of approximately 24.2 percent.
KBS Strategic Opportunity REIT went effective in November 2009 and closed its primary offering three years later after raising $561.7 million in investor equity. As of September 30, 2016, the company owned 11 office properties, one office campus consisting of nine office buildings and 18 acres of undeveloped land, one office portfolio consisting of four office buildings and 25 acres of undeveloped land, one office portfolio consisting of three office properties, one office/flex/industrial portfolio consisting of 21 buildings, one retail property, two apartment properties and two investments in undeveloped land encompassing an aggregate of 1,670 acres.