X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

CHICAGO-The sale of Prime Group Realty Trust, which owns 7.6 million sf of city and suburban office space directly or through joint ventures, to Lightstone Group, LLC is scheduled to close June 28. Also, holders of the REIT’s preferred stock are in line to collect dividends they have waited for since the first quarter of 2004.

A special meeting of holders of the company’s common stock has been scheduled for June 28 to vote on the proposed merger with Lakewood, NJ-based Lightstone Group. If the sale closes this month, preferred shareholders will get $3.375 per share, representing six quarters of dividends. If the closing falls in the third quarter, preferred shareholders will collect $3.94 per share.

Lightstone Group is paying $172 million, or $7.25 per share, for the company’s common stock. However, the deal is estimated to be worth nearly $734 million as Lightstone Group is assuming $426 million in mortgage debt, as well as the outstanding four million preferred shares.

Company executives and members of the board of directors own 11.4% of Prime Group Realty Trust common stock, according to a recent Securities and Exchange Commission filing outlining the deal. Paramus, NJ-based Vornado Realty Trust and Montreal-based Cadim inc. share a 16.8% stake in the company they were once in line to acquire. Orinda, CA-based Kensington Investment Group, Inc. owns 11.6% of the common shares, Arlington, VA-based Aegis Financial Corp. has a 10.5% stake while Donald Smith & Co. Inc., also based in Paramus, NJ, has 9.9% of the company stock.

The sale comes nearly five years after Prime Group Realty Trust began exploring strategic alternatives, ranging from disposing of individual assets to an outright sale of the entire company. The most recent sales effort, led by Wachovia Capital Markets, LLC, resulted in multiple offers for the company.

In May, Prime Group Realty Trust and a previous bidder for the office REIT settled a legal dispute, clearing the way for a sale of the company to Lightstone Group LLC.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.