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REIT IPO Advisory

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research for over 30 years


Advising REIT IPOs for over 20 years

Green Street provides REIT IPO advisory services to companies that are exploring the option of becoming publicly-traded REITs. Drawing on our extensive history of analyzing over 80 REIT IPOs, the Advisory & Consulting Group helps clients make informed decisions on appropriate REIT structures, corporate governance, company strategy, disclosure, and other considerations for soon-to-be public companies. We provide management teams and boards with a comprehensive set of strategies to increase the probability of successful execution and set the stage for superior long-term shareholder returns.

Our team will work with management to evaluate the following, among others:

  • REIT market and REIT IPO overview
  • Property sector fundamentals and forecasts
  • In-depth company and portfolio analysis
  • Benchmarking with publicly-traded REITs
  • NAV estimate
  • Assessment of balance sheet management
  • Corporate governance scorecard
  • Executive compensation
  • G&A analysis
  • Green Street-warranted share price
  • REIT best practices
  • Supplemental reporting
  • Investor positioning

REIT IPO Advisory Apple REIT Case Study


The Client

Apple Hospitality REIT

Property Sector: Hotel


Deal Size

Public listing with concurrent $200 million tender offer

Situation

Apple Hospitality REIT owned a $4.1 billion hotel portfolio acquired over nearly a decade and sought to list or sell the portfolio to provide liquidity to its shareholders. The Company had a complicated story as it was an externally-managed, non-traded REIT formed through the merger of three different REITs. Recognizing these challenges, the firm hired Green Street as an independent, strategic advisor for guidance on the liquidity event that would maximize value for shareholders.

Our solution

Results

  • Conducted thorough valuation analyses using Green Street’s proprietary methodology to identify the key valuation levers for improving Apple’s share price
  • Estimated Apple’s Net Asset Value (NAV) as a baseline for the appropriate liquidity event
  • Provided Apple a roadmap of how to enhance disclosure practices by comparing valuations based upon only the publicly-available information as well as both public and private information
  • Advised the company on how to position its portfolio relative to REIT peers to achieve maximum value in the public market
  • Assisted with the development of a REIT investor communications strategy by helping to create Apple’s roadshow deck. Provided advice and executive coaching to the executive team throughout the listing process

Apple successfully listed on the NYSE on May 18th, 2015. In the first 25 days of trading, Apple outperformed an index of equal-weighted peers by over 4%.

REIT IPO Advisory Case Study


The Client

Private owner of skilled nursing facilities (SNFs)

Property Sector: Healthcare


Deal Size

Portfolio Size

$300 million REIT IPO

$1.5 billion

Situation

The client made an initial attempt to complete an IPO, but was unsuccessful due to market factors and concerns from potential investors. In response, management undertook a concerted effort to season the portfolio, build on its performance track record, and establish investor-friendly financial disclosure. The firm engaged Green Street to be an independent advisor as it reconsidered a public offering.

Our solution

Results

  • Prepared management for the high level of institutional investor scrutiny as it sought to successfully raise capital from the public capital markets
  • Provided guidance on corporate governance and disclosure, two concerns investors raised in the unsuccessful prior REIT IPO attempt
  • Prepared detailed valuation of the company, identifying opportunities to influence the warranted share price positively
  • Advised the company on how to position its portfolio relative to REIT peers to achieve maximum value in the public market
  • Served as the company's advocate during the complex REIT IPO process

Green Street guided the company toward a successful REIT IPO that maximized shareholder value. The company's shares closed at the top of the indicated pricing range and underwriters exercised their overallotment option in full. The company reported that the offering was oversubscribed 13x. The company's total return exceeded its peers by nearly 20% in its first year as a public company.