Pure Multi Family REIT - Q3-2018 Earnings, Price Target Forecast
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The Pure Multi-Family REIT portfolio as of Dec-31-2017 consisted of 22 investment properties, comprising 7,085 residential units, with an average size of 910 sq. ft. per residential unit, located within the five metropolitan areas of Dallas - Fort Worth, San Antonio, Houston, and Austin that are all located in Texas and Phoenix. The average age of the units is 11 years and occupancy was 96.8% as of Sept-30-2018 compared to 95% for as of Dec-31-2017. Typical residential property leases have terms of between one to 12 months. The total portfolio increased to $1.13B at Dec-31-2017 compared to $778M as of Dec-31-2016 mainly from the acquisitions of $328M. Units are listed on the TSX and priced in both Canadian and US dollars using the symbols RUF.UN and RUF.U respectively.
Takeover Offer Terminated
Electra America, the owner and operator of multifamily properties in the U.S., has terminated their offer, previously submitted to the Board of Pure Multi-Family REIT LP (RUF.U, RUF.UN) on Mar-26-2018 to acquire 100% of the outstanding Class A Units of Pure for an all-cash price per Unit of US $7.59 (equivalent to CDN $9.79). The offer excluded the 200,000 Class B units currently held by management. The Class B units become convertible in 2.6M Class A units once the market cap exceeded $300M. The current market cap is over $700M. Management response to the offer is that it is too low and would force them to convert their Class B shares with possible tax consequences.
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