Announced today, RCS Capital Corporation’s (RCAP) wholesale broker-dealer subsidiaries raised about $9.7 billion during 2014, $270 million of which came in December.
Realty Capital Securities, the dealer manager for AR Capital, SC Distributors, a dealer manager of a diverse line up of non-traded investments, and The Hatteras Funds, a provider of liquid alternatives, collectively took in $1.1 billion during Q4 2014 through a total of 31 investment programs.
During the quarter, many broker-dealers suspended selling agreements as a result of the accounting scandal at American Realty Capital Properties (ARCP), an unaffiliated legal entity that has common ownership. As a result, the $270 million raised for December is a far cry from what the capital raising powerhouse typically generates, which usually is two to three times higher. Similarly, the company only raised about $260 million in November.
RCAP sees steady improvements and a return to normalcy in 2015.
“With $9.7 billion in total equity raised for 2014, and $270 million raised in December, we believe our strong sales figures further demonstrate the confidence the market and our selling group members and advisors have in our platform and products,” commented Michael Weil, Chief Executive Officer of RCAP.
Many of those broker-dealers that make up RCAP’s selling group have reinstated agreements to allow their respective advisors to sell RCS Capital distributed investments again.
“With 87% of active selling agreements already back in place and additional reinstatements anticipated, we expect overall capital raising to continue increasing steadily and return to a more normalized run rate in the first quarter of this year,” added Weil.
Realty Capital Securities currently has 1,097 active selling agreements and relationships with over 325 broker-dealers and RIAs. SC Distributors adds 390 active selling agreements.