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LONG BEACH, CA-HCP health care properties REIT has set the price at $24.75 per share for its public offering of 15.5 million shares of common stock, which is expected to raise proceeds of approximately $384 million. The company plans to use the proceeds of the offering to repay debt, including borrowings from the company’s credit line that were applied toward the cash payment of $165 million for HCP’s purchase of a stake in first mortgage debt of HCR ManorCare. The remainder of the proceeds will be applied to general corporate purposes.

The offering of 15.5 million shares was upsized from the originally announced 11.5 million shares due to investor demand, HCP says. The underwriters also have an option to purchase up to 2.3 million shares within 30 days.

The new HCP offering is the latest in a series of new stock offerings by REITs, which have been raising substantial amounts of capital despite the recession and capital markets conditions that have been in turmoil. Earlier this year, HCP completed a $440-million public offering of common stock, with proceeds also used to repay debt.

Although investors favor health care and medical office-related properties in the downturn, REITs in other property segments have been raising funds as well. Analyst Craig Silvers, president of Los Angeles-based Bricks & Mortar Capital, which invests in REITs and other publicly held real estate companies, told GlobeSt.com recently that REITs and other public real estate companies have been able to raise capital lately because of investors’ long-term confidence in real estate. “People have realized that corporations need real estate, and that despite the tight credit markets, real estate is a necessity and they are willing to loan on it at the right price,” according to Silvers. In terms of stock offerings, investors realize that they are buying at historically low prices, Silvers said.

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