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The founder of American Financial Realty Trust, who has established a new company, is planning for an initial public offering with the potential to raise $1.5 billion.
Nicholas Schorsch formed American Realty Capital Trust Inc., a new real estate investment trust based in Jenkintown, and intends to sell up to 150 million common shares, according to Securities and Exchange Commission documents filed Sept. 10. He founded and ran American Financial, also based in Jenkintown. That REIT focused on buying properties from financial institutions and leasing them back to the banks. That company went public in June 2003, raising more than $800 million in what was then one of the largest IPOs for a REIT.
Schorsch, 46, resigned from American Financial in August 2006, forming American Realty. So far, the new company has invested $242 million into 52 properties totaling 1.5 million square feet, according to SEC documents. It has $500 million in properties under contract that are expected to close by next April.
American Realty departs from Schorsch's earlier business model of buying properties leased to financial institutions. The new company concentrates on retail, office and industrial properties with long-term leases of 10 years or more and high-quality tenants. For example, the retail properties will be leased to prominent, national tenants such as convenience stores, drug stores, restaurants and "big box" retailers. The company will buy properties across the United States and in Puerto Rico.
This material does not constitute an offer to sell nor a solicitation of an offer to buy any securities described herein or otherwise. Only a prospectus for a specific securities offering makes such an offer. In that regard, the use of this material is authorized only when it is accompanied or preceded by a prospectus. Further, all information contained in this material is qualified by the terms of a current Prospectus of the offering of securities to which it relates, if any.
This material may contain forward-looking statements that involve assumptions, uncertainties and risks, some of which are set forth below. These statements are not guarantees and should not be regarded as representations that the results or conditions described in such statements, or that our objectives and/or plans, will be achieved.
A real estate investment program offering is subject to the following Risks: The failure to qualify, or maintain the requirements, to be taxed as a REIT would reduce the amount of income available for distribution and limit a REIT's ability to make distributions to its stockholders. No public market initially exists for a REIT's shares of common stock, and one may never exist for this or any other such type of real estate program. Securities are being offered on a best efforts basis. These are speculative securities and as such involve a high degree of risk. There are substantial conflicts among an offering and its sponsor, advisor, dealer manager and property manager. There is no assurance that the value of the real estate will be sufficient to return any portion of investors' original capital. Operating results will be affected by economic and regulatory changes that have an adverse impact on the real estate market and we cannot assure you that there will be growth in the value of the properties.
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Realty Capital Securities, LLC, Three Copley Place, Suite 3300, Boston, MA 02116, T 877-373-2522
American Realty Capital Trust, Inc., 405 Park Avenue, 15th Floor, New York, NY 10022, T 212-415-6500
American Realty Capital Advisors, LLC, 106 York Road, Jenkintown, PA 19046, T 215-887-2189
Realty Capital Securities, LLC (Member FINRA/SIPC), an affiliate of American Realty Capital Trust, Inc., is the dealer-manager for American Realty Capital Trust, Inc. Investors should consider a fund's investment objectives, risks, charges and expenses before investing. The Prospectus contains this as well as other important information. Carefully read and consider the information contained in the Prospectus before you invest or send money. The information on this site must be read in conjunction with the Prospectus in order to fully understand all the implications and risks of the offering of securities to which it relates. A copy of the Prospectus must be made available to you in connection with this offering.
Properties depicted in the photographs are of assets held in either American Realty Capital's current offerings or past real estate investment programs sponsored by American Realty Capital.
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