Lightstone REIT Lowers Distribution by 50%
Lightstone Real Estate Income Trust, Inc., a publicly registered non-traded real estate investment trust, lowered its monthly distributions from an annual rate of 8 percent to 4 percent.
Lightstone Real Estate Income Trust, Inc., a publicly registered non-traded real estate investment trust, lowered its monthly distributions from an annual rate of 8.0 percent to 4.0 percent. The reduction will apply to the third quarter of 2019 and the board plans to evaluate the distribution policy going forward on a quarterly basis.
The board authorized the reduction due to the liquidity of the company, operating cash flows, general financial and market conditions, potential repositioning of assets, and the belief that the previous 8 percent distribution is not currently supported by the expected modified funds from operations.
In other company news, Lightstone REIT purchased four parcels of land located at 353-361 Bedford Avenue in Brooklyn, New York for approximately $30.4 million. Proceeds from its other properties will be redeployed into this and other higher yielding investments, the company said in an investor presentation.
The REIT plans to build a 210-room Marriott Moxy hotel with more than 11,200 square feet of food and beverage space. The expected completion date is December 2021.
The REIT has a net asset value per share of $10.00 as of December 31, 2018, which includes $12.6 million in principal advances made by an affiliate of the company.
Lightstone Real Estate Income Trust launched in February 2015 and raised approximately $85.6 million prior to terminating its offering in March 2017. The company holds a 22.5 percent interest in a 281-unit multifamily property in Tiburon, California in which it invested $20 million. The company also invested $37 million in a preferred equity investment in the Marriott Moxy Chelsea Hotel project for which it receives an annual 12 percent distribution.
The REIT also invested $14.4 million in a joint venture project to build a 29-unit residential property in the Upper East Side of New York City. The firm owns a 33.3 percent interest in the joint venture. Lightstone REIT also owns $4.5 million in corporate bonds that trade on the Tel Aviv Stock Exchange.
