The board of Pacific Oak Strategic Opportunity REIT Inc., a publicly registered non-traded real estate investment trust formerly known as KBS Strategic Opportunity REIT Inc., has approved a $10.63 net asset value per share of the company’s common stock, as of September 30, 2019. Last year, the REIT declared a $9.91 NAV per share, and shares were originally sold for $10.00.
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 shares outstanding, all as of September 30, 2019.
The REIT’s assets, which include real estate, joint venture investments, securities and other assets, total $1.5 billion, while it’s liabilities total $709 million.
The company’s 11 real estate assets had an estimated value of nearly $1.1 billion. The total cost basis of these properties was $827.3 million, and includes the acquisition cost of $710.5 million, $20 million for the acquisition of minority interests in joint ventures, $88.3 million in capital expenditures, leasing commissions and tenant improvements and $8.5 million of acquisition fees and expenses, as well as foreclosure costs.
The total estimated real estate value compared to the total acquisition cost plus capital improvements results in an overall increase in the real estate value of approximately 26.3 percent.
The REIT owned four investments in real estate equity securities valued at $79.1 million. Investments in unconsolidated joint ventures totaled $219.2 million, and other assets totaled $119 million.
Duff & Phelps LLC and Colliers International Valuation & Advisory Services, two independent third-party real estate valuation firms, assisted with the valuation, which was performed within Institute for Portfolio Alternatives guidelines, the company said.
Pacific Oak Strategic Opportunity REIT launched its initial public offering in November 2009 and has raised approximately $638 million in investor equity from the offering and distribution reimbursement plan, as of the third quarter 2019. In October the REIT terminated its advisory agreement with KBS Capital Advisors LLC and appointed Pacific Oak Capital Advisors LLC as its new external advisor. In November, the REIT completed a merger with Reven Housing REIT Inc. (NASDAQ: RVEN), a publicly traded REIT, for approximately $56.6 million in cash, or $5.13 per share of Reven common stock.