X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

GLENDALE, CA-PS Business Parks Inc. has joined the list of REITs and other publicly held real estate companies raising new funds in the public markets lately with the pricing of a its new stock offering, scheduled to close today, at $46.50 per share. The REIT, which operates business parks in eight states, anticipates that it will raise $133.4 million in proceeds via the stock offering, or $153.4 million if underwriters exercise their over-allotment option in full.

The offering is for three million shares, with the underwriters’ option to buy up to an additional 450,000 shares. In addition to the offering, Public Storage Inc., for which PS Business Parks manages approximately 1.4 million rentable square feet, has agreed separately to buy 333,333 shares for net proceeds of approximately $15.5 million. If the underwriters exercise the over-allotment option in full, an additional 50,000 shares will be sold to Public Storage, for total net proceeds of $17.8 million.

The company plans to use the proceeds of its stock offering for general corporate purposes, including possible future acquisitions. President and CEO, Joseph D. Russell noted in the company’s recent earnings conference call that one of the three main elements of the REIT’s strategy in navigating the recession is to “track the investment market because this economic crisis will likely reward those with capital structures and operational models that can deflect many of the onerous consequences of this environment.”

The other two elements of the strategy that Russell outlined include staying close to its customers and continuing to maintain its strong balance sheet. Russell explained that PS Business Parks is prioritizing small users because, “They are, in many cases, the only source of leasing opportunities in many markets.” Regarding the company’s balance sheet, he pointed out that preserving low leverage has enabled the company to retain cash. “We are not burdened by having to deleverage our balance sheet,” Russell said.

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?

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.