Joseph E. Robert Jr., a prominent Washington area investor, and the family of real estate developer Oliver T. Carr Jr. plan to take parts of businesses they control public.
Robert's JER Investors Trust Inc. plans to raise as much as $230 million in a stock offering, according to a registration statement filed with the Securities and Exchange Commission on Monday.
Joseph E. Robert Jr.'s JER Investors Trust hopes to raise as much as $230 million in a public stock offering.
(File Photo)
|
|
Columbia Equity Trust Inc., which was formed in September to take over properties controlled by the family of Oliver T. Carr Jr., plans to raise as much as $184 million, according to an SEC filing made last week.
Over the past 24 years, Robert, a leading Washington area philanthropist, has created one of the nation's most successful private real estate investment organizations, investing in or managing more than $40 billion in commercial real estate assets. The financial disclosure required of a publicly traded company will provide the first substantial look inside the real estate investment empire of Robert, who has been intensely private about his business affairs.
JER Investors specializes in one of the more arcane branches of the real estate investment business: investing in securities backed by pieces of commercial mortgages.
The company was formed last April with $160 million raised by Arlington investment bank Friedman, Billings, Ramsey & Co., which will manage JER's initial stock offering. Existing shareholders may sell an undetermined amount of stock in the offering, according to JER's SEC filing, while the proceeds of stock sold by the company will go to repay debt.
As of Dec. 31, JER Investors had assets of $196.9 million, invested mostly in a variety of commercial mortgage-backed securities.
Robert will be chairman of the company. JER's president and chief investment officer is Gene McQuown, a J.E. Robert Co. managing director who joined the Robert organization in 1989.
J.E. Robert Co.'s main business, which remains privately owned, is managing several large funds that amass money from institutions and wealthy investors to invest in commercial real estate. In October the company finished raising its fifth and largest fund, JER Real Estate Partners III, with $823 million in private placements.
Clyde Robinson, a JER spokesman, declined to comment on the planned public offering.
The Carr family business started in 1955, when Oliver T. Carr Jr. began building homes in Montgomery County. Over the next four decades, he was a prolific office developer, especially in the District's downtown core.
Columbia Equity Trust was created to take over most of the privately owned local office buildings held by the family's Carr Capital, which has a portfolio worth about $360 million.
Columbia Equity Trust initially will own or co-own 10 commercial office properties in the Washington area. The company said in its SEC filing that it plans to expand its holdings by buying small and medium-size office buildings in the area. It already has three office buildings under contract, for a combined purchase price of about $182.5 million.
The public company will expand a group of businesses controlled by Carr's sons that own or manage properties all over the United States. Thomas A. Carr runs CarrAmerica Realty Corp. -- a publicly traded real estate company that owns properties in the Washington area, Chicago, Texas and the West. Brother Robert O. Carr runs two CarrAmerica affiliates, Carr Real Estate Services Inc. and CarrAmerica Urban Development LLC.
Oliver T. Carr III, a third son, is chief executive of Columbia Equity. While legally separate from other family-controlled entities, it will have property management agreements with CarrAmerica, according to Columbia's SEC filing. Oliver T. Carr III declined to comment. The company's SEC filing did not indicate that any insiders planned to sell shares.
Brian T. McVay, a senior managing director at the real estate firm Cushman & Wakefield Inc., said Columbia Equity's strategy to focus on the Washington area makes sense.
"D.C. is showing year in and year out that it's one of the strongest real estate markets in the country in terms of demand and the premiums that are being paid for buildings," McVay said.
