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American Healthcare REIT Listing on New York Stock Exchange


Highlights

  • On January 29, 2024, American Healthcare REIT, Inc. (“AHR”), formerly Griffin-American Healthcare REIT IV, Inc. (“GAHR IV”), announced the launch of its public offering of 56 million common shares on the New York Stock Exchange (“NYSE”).

  • On February 6, 2024, AHR announced the pricing of the shares at $12.00 per share. The most recent net asset value for AHR’s common stock was calculated as of December 31, 2022 at $31.40 per share.

  • AHR is a self-managed REIT which was formed through the merger of Griffin-American Healthcare REIT III, Inc. (“GAHR III”) with and into GAHR IV. GAHR IV originally raised capital through a public offering between February 2016 and February 2019, raising gross proceeds of approximately $754.1 million, excluding its DRIP.


On January 29, 2024, AHR, an internally managed, non-traded real estate investment trust (“REIT”) that owns and operates healthcare real estate properties, announced the launch of its first listed public offering of 56 million common shares on the NYSE under the ticker symbol “AHR.” The shares were expected to be listed at a price range of between $12.00 and $15.00 per share and, on February 6, 2024, AHR announced the pricing at $12.00 per share. The shares began trading on the NYSE on February 7, 2024 and the offering is expected to close on February 9, 2024. Additionally, AHR has granted the underwriters of the offering a 30-day option of purchasing up to 8.4 million additional shares.


AHR was originally formed by the merger of GAHR III with and into GAHR IV in a stock-for-stock transaction in October 2021. At the time of the merger, each outstanding common share of GAHR III was converted into the right to receive 0.9266 shares of AHR’s Class I common stock. Immediately prior to the merger:

  • GAHR III internalized management by acquiring the business and operations of American Healthcare Investors, LLC (“AHI”), the co-sponsor of both REITs, and its majority interest in the external advisors of the REITs; and

  • Griffin Capital Company, LLC (“Griffin Capital”), the other co-sponsor of the REITs, contributed its interests in the advisors of the REITs.


As payment for the internalization, GAHR IV issued 15.1 million OP units valued at $8.71 per unit, for a total of $131.7 million, 23% of which was payable to Griffin Capital and the balance was payable to the former members of AHI. As a result of the internalization, AHR became a self-managed REIT.


Subsequent to the merger and internalization, and as of December 31, 2021, AHR reported an estimated net asset value of $9.29 per share. On November 15, 2022, AHR effected a 1-for-4 reverse split of its common shares and, as a result, every four shares of AHR common stock was automatically combined into one share of AHR common stock. AHR’s most recent net asset value per share of $31.40 was calculated as of December 31, 2022.


The following table presents a summary of estimated hypothetical returns for investors in GAHR IV in connection with AHR’s listed public offering, based on the following scenarios, assuming an exit on the listing date of February 7, 2024, at: (i) the opening price of $12.00 per share; (ii) 20% below the opening price; and (iii) 20% above the opening price:



The following table presents a summary of hypothetical returns with respect to the listing for investors from GAHR III’s offering:



While these estimated returns present a range of potential returns based on the initial price and certain assumed increases or decreases, actual returns will be based on the price at which the common stock trades after listing, which may be outside of the range presented. In addition, existing Class T and I shareholders are subject to a restricted period or “lock-up” of 180 days after the IPO. During this lock-up period, these shareholders will be unable to redeem or sell their shares.


 

Sources



Disclaimer: The information contained in this research note has been assembled using publicly available information. While SK Research and Due Diligence, LLC (“SKRADD”) believes it to be reliable, there is no guarantee that all of the information contained in this research note is or will be accurate. This research note does not constitute investment advice and is intended for informational purposes only. This research note does not constitute an offer to sell or the solicitation of an offer to purchase, nor should it be considered a recommendation of any security referenced herein. This publication is copyrighted, and no person is authorized to make use of the information presented herein without the express written permission of SKRADD. SKRADD is under common ownership and control with Snyder Kearney, LLC, a law firm that conducts due diligence reviews of alternative investment programs, including non-traded real estate investment trusts.


©2024 SK Research and Due Diligence, LLC.




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