Texas-based real estate investment trust (REIT)
Whitestone REIT (
has recently announced a public offering of 4.0 million shares to
enhance its liquidity. The company has also decided to grant the
underwriters a 30-day option to purchase up to an additional 0.6
million shares to cover the over-allotment options.
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WHITESTONE REIT (WSR): Free Stock Analysis
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Robert W. Baird & Co. Inc acted as the sole book-running
manager of the offering. Whitestone intends to utilize the proceeds
from the transaction to repay debt and for other general corporate
purposes, including redevelopment activity. The secondary offering
is likely to provide financial flexibility to Whitestone to seize
accretive investment opportunities, which could in turn go a long
way in enhancing top-line growth.
Whitestone is focused on its strategy of portfolio optimization and
increasing the tenant mix. Recently, the company acquired a 125,898
square foot community center titled Paradise Plaza in
Phoenix, Arizona, for $16.3 million. As of June 30, 2012,
Whitestone owned 46 community center properties spanning
approximately 3.6 million square feet, including two development
Since its inception in 1998, Whitestone has owned, operated and
re-developed community centered properties, which are located in
established or developing culturally diverse neighborhoods.
Whitestone has a diversified tenant base concentrated on service
offerings including medical, education and casual dining. As of
June 30, 2012, Whitestone had cash and cash equivalents of $3.9
million and $101.0 million available under its revolving credit
Whitestone, which competes with the likes of
General Growth Properties Inc. (
, recently reported second quarter 2012 recurring funds from
operation (FFO) of 23 cents per share, missing the Zacks Consensus
Estimate by 4 cents. We presently have a long-term 'Neutral'
recommendation on the stock. Also, it carries a Zacks #3 Rank (a
short-term Hold rating).
Note: FFO, a widely accepted and reported measure of the
performance of REITs, is derived by adding depreciation,
amortization and other non-cash expenses to net income.