Weekly Real Estate News
Summary
Presidio Property Trust accepted 149,773 Series D preferred shares in its exchange offer and expects to issue 823,753 common shares when the transaction settles.
Presidio Property Trust said Monday that holders tendered 149,773 shares of its 9.375% Series D Cumulative Redeemable Perpetual Preferred Stock in the company’s exchange offer, representing approximately 15.4% of the Series D shares outstanding.
According to Presidio’s SEC filings, the San Diego-based real estate investment company accepted all of the shares that were validly tendered and not withdrawn before the offer expired at 11:59 p.m. New York time on Oct. 2.
Participating holders are to receive 5.5 newly issued shares of Presidio common stock for each accepted Series D preferred share. Based on the final tender count, the company expects to issue an aggregate of 823,753 common shares in the exchange.
Settlement is expected on or about Oct. 6, according to the company’s amended tender-offer filing. The timing remains an expected settlement date rather than confirmation that settlement has occurred.
About 15% of the preferred shares were tendered
Presidio reported 973,736 Series D preferred shares outstanding before completion of the exchange. The 149,773 shares accepted in the offer therefore account for approximately 15.4% of that total.
The exchange does not eliminate the Series D preferred class. Roughly 824,000 preferred shares would remain outstanding based on the company’s reported pre-exchange count, subject to the final settlement mechanics and any other changes in outstanding shares.
The offer exchanged preferred equity for common equity rather than cash. For participating investors, that changes the nature of their ownership: the Series D security carries a 9.375% cumulative preferred dividend and preferred-stock rights, while the newly issued common shares participate as common equity.
For Presidio, issuing 823,753 common shares increases the common share count while reducing the amount of Series D preferred stock outstanding. The economic effect on individual holders will depend on factors including Presidio’s common-share price, future distributions and the relative rights of the two securities.
Final results disclosed through SEC filing
Presidio disclosed the final results in an amendment to its Schedule TO filed with the Securities and Exchange Commission on Oct. 5. The filing also incorporated the company’s announcement of the results.
The exchange ratio was fixed at 5.5 common shares for each Series D preferred share accepted. Presidio said it accepted all 149,773 shares validly tendered, meaning the final results did not require proration among participating holders.
The transaction is a capital-structure event rather than a property acquisition or disposition, but it is relevant to the REIT’s investors because it shifts a portion of the company’s outstanding preferred equity into common stock and reduces the preferred dividend obligation associated with the exchanged shares.
