CIM Real Estate Finance Trust and KBS Real Estate Investment Trust III Inc. have each issued a letter to shareholders encouraging them to reject unsolicited mini-tender offers from Tel Aviv-based investment fund Comrit Investments 1 LP. The deadline for tender offers is December 29, 2022.
With a price of $4.61 per share, Comrit intends to purchase up to 22.4 million shares of CIM Real Estate Finance Trust, which has an estimated net asset value of $7.20 per share as of March 31, 2021, which is $3.60 below what Comrit is offering. A recent price recorded for the REIT’s shares on Realto, an online secondary trading platform for illiquid securities, was $5.86.
CIM’s letter states that “the offer price is far below the present and future value of the shares and represents an opportunistic attempt by Comrit to buy you at a deep discount.”
Many investors have lost substantial money in the REITs and alleged they were misled by financial advisors when they bought them. Investors can contact Haselkorn & Thibaut at 1-888-902-6872 or visit their website on suing financial advisors.
The company will purchase 1.2 million shares of KBS Real Estate Investment Trust III common stock for $5.68 each. As of September 28, 2021, Comrit reported a net asset value of $9.00 per share, 37% less than what Comrit is offering. According to Realto, the last reported price was $7.97 per share.
KBSS wrote that Comrit’s offer to buy 1,232,394 shares shows that it values KBS REIT III and thinks the shares are worth more than its offer price of $5.68 per share since it already owns 1,264,492 shares acquired in the IPO, tender offers, and secondary market.
KBS REIT III said in a letter to investors that it will begin accepting ordinary redemption requests from stockholders on January 3, 2023, with a redemption date of January 31, 2023.
Owning and managing commercial real estate assets is the primary objective of CIM Real Estate Finance Trust. During an offering that began in January 2012 and closed in April 2014, the REIT successfully raised over $3 billion in net leased buildings and commercial mortgage loans.
According to valuations performed in September 2021, KBS REIT III’s portfolio of 17 buildings in May 2022 was valued at $3 billion. The initial offering for KBS REIT III began in October 2010 and ended in July 2015.