Commercial Real Estate tic.............tic,,, Message Board

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Strategies & Market Trends : Commercial Real Estate tic.............tic,,,

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From: Travis_Bickle	9/23/2008 5:13:36 PM
	of 442

Raising Cash at Corporate Office Properties (OFC) We have been highlighting how some of the commercial office space and retail REITs have been having a hard time as their need to raise cash is going to come at a high price as the current environment is driving up borrowing costs as their capital needs continue and as tenants run into issues. Corporate Office Properties Trust Inc. (NYSE: OFC) has just announced that it will sell 2,000,000 shares of common stock in a secondary offering. At today's close of $40.02 that is barely $80 million. Its market cap is $1.91 Billion. These shares do fall under an existing shelf registration. But the size of the underwriting group looks massive for such a small offering. The joint book-runners are Raymond James and Banc of America Securities; J.P. Morgan Securities, Robert W. Baird & Co., RBC Capital Markets, and Stifel Nicolaus & Company are the senior co-managers and co-managers are listed as BMO Capital Markets and Morgan Keegan. Yep, eight underwriters for $80 million in proceeds. The underwriters have an option to sell up to 300,000 shares for 30-days to cover over-allotments. That is the size of an underwriting group you might expect if this was a $400 million offering in normal times. At least the REIT might be buying off any of the analyst downgrades from these firms for a few weeks. This is being used for financing activities. Corporate Office plans to use the proceeds to fund development costs and other investing activities, and for general corporate purposes. It will initially use the funds to repay amounts outstanding under its unsecured revolving credit facility. Shares closed up 1.5% today at $40.02 and ts 52-week trading range is $25.43 to $45.39. Shares are down 2.5% after the close at $38.99 based upon the sale. 247wallst.com

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