Real estate investment company, Kingston Properties Limited (KPREIT), is again tapping the equities market. This time to raise $1.5 billion with the option to upsize to $2.25 billion as it inches towards its strategic goal of having one million square feet of real estate under management and amassing $10 billion in equity by 2023.
In its latest invitation, an additional public offering (APO), which opens on April 19, 2022, KPREIT will offer 200,000,000 new ordinary shares, with the ability to upsize to a maximum of 300,000,000 new ordinary shares, according to the prospectus issued on April 6, 2022. KPREIT’s offer is priced at $7.50.
“The COVID-19 pandemic has created major shifts in the real estate industry which we have already begun to take advantage of with the $700 million bridge loan which we secured last July. With this raise, we intend to continue to identify and take advantage of distressed assets in segments of the real estate market most likely to benefit from the recovery expected post-pandemic,” said CEO of Kingston Properties Limited, Kevin Richards.
Richards said KPREIT is bullish on the industrial space driven largely by the growth in e-commerce over the years and rising demand for warehouse and mixed-use spaces.
KPREIT has indicated that its key priorities over the next 12 months remain to grow its capital base, diversify its portfolio geographically, and leverage strategic partnerships for growth.
The group has been identifying mainly value-add commercial properties in multiple jurisdictions to provide a better than average risk-adjusted return.
Since its last capital raise in 2019, KPREIT has made several large and impactful investments including the acquisition of a fully-tenanted office building in the Cayman Islands, a warehouse complex in Kingston in 2020; a property to be developed as an office and mixed-use complex in New Kingston’ a greenfield development of mixed-use industrial properties in the Cayman Islands and Jamaica as well as entered into partnership agreements to participate in the multi-family and commercial office spaces in the US.
Since its rights issue in 2019, KPREIT’s stock price has risen by over 69 per cent and has paid out approximately US$1.35 million in dividends to shareholders.
“KPREIT gives investors access to the global real estate market with 38 per cent of our current investment portfolio in The Cayman Islands and 11 per cent in the United States of America. Fifty-one per cent of our portfolio is in Jamaica. Our exposure to multiple jurisdictions and industries, above-average dividend payout ratio when compared to our peers and a track record of strong returns based on capital appreciation over the years makes KPREIT very attractive to investors looking to capitalise on the global real estate market,” Richards said.
The lead broker and underwriter for the offer are VM Wealth Management with Sagicor Investments Limited, JMMB Securities Limited, JN Fund Managers, Scotia Investments and Barita Investments listed as selling agents.