Associated Estates Realty Corporation
), a real estate investment trust (REIT), recently announced that
it has priced 5.5 million shares at $14.40 each.To cover the
over-allotment options, Associated Estates also plans to offer a
30-day option to the underwriters for purchasing an additional
825,000 shares.The offering is expected to close on June 27,
The company expects to generate net proceeds of approximately
$75.8 million from the offering after the underwriting discount and
estimated offering expenses. The net proceeds from the equity offer
will be utilized to repay debts outstanding under its unsecured
revolving credit facility, to fund property acquisitions and for
general corporate purposes.
During the first quarter 2012, Associated Estates repaid seven
property-specific mortgage loans totaling $123.5 million, thus
leaving the company with no remaining debt maturities in 2012.
These repayments were funded from the unsecured revolving credit
Associated Estates reported first quarter 2012 adjusted FFO
(funds from operations) of 25 cents per share, compared with 23
cents per share in the year-earlier quarter. Funds from operations,
a widely used metric to gauge the performance of REITs, is obtained
after adding depreciation and amortization and other non-cash
expenses to net income.
Headquartered in Richmond Heights, Ohio, Associated Estates'
portfolio consists of 53 properties containing 13,908 units in
eight states. It primarily owns and manages apartment
communities in the Midwest, Mid-Atlantic and Southeast regions in
Associated Estates currently retains a Zacks #3 Rank, which
translates into a short-term Hold rating. We have a long-term
Neutral recommendation on the stock. One of its competitors,
) also holds a Zacks #3 Rank.
ASSOC ESTATES (AEC): Free Stock Analysis Report
EQUITY RESIDENT (EQR): Free Stock Analysis
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