REIT Gets SEC OK for St. Regis Aspen Resort IPO
Upon closing of the $33.5 million initial public offering, the company would become the first single-asset REIT to list on a U.S. securities exchange.
By Gail Kalinoski
Aspen REIT Inc. has been given approval by the Securities and Exchange Commission for a $33.5 million initial public offering allowing investors to buy shares in the luxury St. Regis Aspen Resort in Colorado.
Upon closing of the IPO, Aspen REIT will be the first single-asset REIT to list on a national securities exchange in the U.S., according to the company.
Aspen REIT is offering 1,675,000 shares at $20 per share in the Regulation A+ IPO. The REIT applied to list its common stock on the NYSE American stock exchange under the ticker symbol AJAX. Aspen REIT intends to use substantially all of the net proceeds from the IPO, together with equity in Aspen REIT’s subsidiary operating partnership, to acquire the St. Regis Aspen Resort, a full-service, 179-key luxury hotel at the base of Aspen Mountain in the Rocky Mountains. The resort has four onsite food and beverage outlets, a private spa and 29,000 square feet of indoor and outdoor conference and banquet venues. It is managed by a subsidiary of Marriott International Inc.
“Today, any investor can subscribe to become a part owner in the St. Regis Aspen Resort, one of the world’s finest luxury hotels. Through this first-of-its-kind offering in the United States, we are leveling the playing field for all investors, creating equal opportunity to participate in the upside associated with a first-class resort destination supported by strong fundamentals, an experienced leadership team and a world-class property manager,” Stephane De Baets, CEO, president & chairman of Aspen REIT, said in a prepared statement.
De Baets told Commercial Property Executive in an email that they hope to begin trading shares in February.
Regulation A + and the JOBS Act
He said the decision to choose a Regulation A+ IPO was made to reach as many investors as possible. In March 2015, the SEC agreed to an update referred to as Regulation A+ as part of the Jumpstart our Business Startups (JOBS) Act that allowed smaller companies to sell as much as $50 million in securities in a 12-month period, with certain requirements and by accredited investors. The change opened up the real estate investment world to those with thousands to deploy in addition to those with millions.
“There’s different ways to raise money when you want to be a public company. Depending on which route you choose, the SEC allows you to market your product in certain ways. Obviously, in our case, we wanted to reach all investors as well as the general public, and in a Regulation A + offering, we are allowed to do that by leveraging the power of digital marketing,” De Baets said in the email. “We truly believe that digital marketing is the best way to raise money, which is why a Reg +A offering was attractive to us.”
Maxim Group LLC is the lead managing selling agent for the offering.
Aspen REIT, a recently-formed, single-asset REIT, is externally managed by a majority owned subsidiary of Elevated Returns LLC, a New York-based real estate asset management and advisory firm.
Images courtesy of Aspen REIT Inc.