Privately-held real estate firm Procaccianti Companies Inc. is launching a $552 million non-traded real estate investment trust named Procaccianti Hotel REIT Inc., according to registration documents filed with the Securities and Exchange Commission. Procaccianti Companies owns TPG Hotels & Resorts, one of the largest privately held owner/operators of hotels in the United States.
Proceeds from the offering will be used the fund the purchase of hospitality properties throughout the United States, as well as distressed debt and preferred equity with the intent of acquing hotel properties underlying these types of investments. Procaccianti Hotel Advisors LLC will serve as the REIT’s advisor, and S2K Financial LLC will serve as the dealer manager.
The offering is comprised of four share classes: Class A, Class I, Class T, and Class K shares. The minimum purchase is $2,000, except in New York where the minimum purchase is $2,500.
Class A shares will be priced at $10.00 each and include a 5 percent selling commission and a 3 percent dealer manager fee.
Class I shares will be priced at $9.50 each and include a 3 percent dealer manager fee and no selling commission.
Class K shares will be priced at $10.00 each and include a 5 percent selling commission and a 3 percent dealer manager fee.
Class T shares are priced at $10.00 each and include a 3 percent selling commission, a 3 percent dealer manager fee, and an annual 1 percent shareholder servicing fee.
Class A, Class K, and Class T shares will be available for purchase through various distribution channels, while Class I shares will only be available through wrap accounts, registered investment advisers not affiliated with a participating broker-dealer, and by institutional investors.
The company will use all proceeds from the sale of Class A shares to fund organization and offering expenses related to Class I, Class K, and Class T shares. The proceeds will also be used to make up the difference of the reduced Class I share price, as well as certain reduced or waived selling commissions or dealer manager fees.
The advisor, dealer manager, and their respective affiliates have agreed to purchase Class A shares at $10.00 each, however, no selling commissions, dealer manager fees, or other organization and offering expenses will be paid by these entities.
The REIT is also offering $50 million in distribution reinvestment plan shares for Class I, Class K, and Class T shares only. No Class A DRIP shares will be offered.
Procaccianti Hotel REIT disclosed that it has the option to acquire a 51 percent joint venture interest in two select service hotels owned by an affiliate of the REIT’s sponsor. The hotels include the 119-room Staybridge Suites St. Petersburg Downtown in St. Petersburg, Florida and the 200-room Springhill Suites Wilmington Mayfair in Wilmington, North Carolina.