Consolidated-Tomoka announces formation of new single-tenant net lease REIT
Consolidated-Tomoka announced the formation of Alpine, or "PINE". as an independent single-tenant net lease real estate investment trust, sponsored by CTO. PINE plans to conduct an initial public offering in which PINE intends to raise the necessary capital to acquire from CTO 15 of the IPO Portfolio assets for approximately $125.9M in cash. In addition, as part of PINE's formation, CTO will contribute to Alpine five of the IPO Portfolio assets in exchange for approximately 1.2M units in PINE's operating partnership. These OP Units are expected to have a value of approximately $24.5M based on a preliminary estimate of the mid-point of the public offering price range of the PINE IPO. CTO intends to invest $7.5M in the common stock of PINE through a private placement concurrent with the IPO. Following completion of the PINE IPO and Alpine's related formation transactions, CTO's ownership of PINE is expected to total approximately 17.5%, based on the Company's aggregate ownership of OP Units and the PINE shares purchased in the private placement. It is intended that Alpine will apply to list its common stock on the NYSE under the ticker symbol "PINE" following the completion of its IPO. CTO also announced that it intends to focus its investment strategy on higher return multi-tenant office and retail properties in strong MSAs and select growth markets throughout the U.S., and intends to rebrand itself as CTO Realty Growth, Inc. The Company anticipates redeploying the approximately $125.9M in proceeds from the planned cash sale of the 15 assets to PINE, and the approximately $97M in proceeds from the recently-announced land joint venture, to acquire properties consistent with our strategy utilizing the 1031 like-kind exchange transaction structure. The Company will maintain its status as a C-corporation while retaining the optionality to convert to a REIT in the future.