March 11, 2022 Comments (0) Blog, Current Investigations

WP Carey’s Corporate Property Associates 18 – Global Inc. Liquidation

WP Carey's Corporate Property Associates 18 – Global Inc. Liquidation, featured by top securities fraud attorneys, the White Law Group

Corporate Property Associates 18 – Global Inc. announces affiliated merger with W.P. Carey Inc. (NYSE: WPC)    

The White Law Group is investigating potential claims involving broker dealers who may have unsuitably recommended Corporate Property Associates 18 – Global Inc.  (CPA 18 – Global) to investors.   

Corporate Property Associates 18 – Global Inc. (CPA 18), a publicly registered non-traded real estate investment trust (REIT) managed by W.P. Carey Inc., has raised close to $1.2 billion in gross proceeds from investors, according to filings with the SEC. The REIT’s lease portfolio reportedly includes self-storage properties and student housing projects.   

On February 28, CPA 18 reported its board of directors approved a definitive merger agreement with affiliate W.P. Carey Inc. (NYSE: WPC) in a $2.7 billion transaction. CPA 18 shareholders will reportedly receive merger consideration of $3.00 per share in cash and 0.0978 shares of WPC common stock.   

This merger consideration is $10.45 per share based on WPC’s reported 3-day volume weighted average price of $76.17 as of February 25, 2022. The merger with publicly-traded WPC, which also owns CPA 18’s external advisor, will provide CPA 18 shareholders with liquidity on their investment, as no lock-up period is attached to CPA 18 shareholders following the close of the merger and their receipt of WPC common stock.  

CPA 18 owns 127 properties, including student housing, office, retail, self-storage and hospitality properties. It is one of the 25 largest publicly traded REITs by market capitalization.  

WPC reportedly listed its common stock on the NYSE in 2012 and closed mergers with affiliated REITs CPA 15 (October 2021), CPA 16 (January 2014), and CPA 17 (October 2018), according to reports. The definitive merger agreement is depending on CPA 18 common stockholder approval and is expected to close in the third quarter of 2022.   

How Does a Merger Affect Shareholders?

Companies often merge as part of a strategic effort to boost shareholder value, often by creating new business lines and/or gaining greater market share. However, the economic environment at the time of the merger, size of the companies and management of the merger process all play a part in future returns for shareholders.   

Shareholders may experience a significant loss of voting power, and while the spike in trading volume tends to inflate share prices, if economic conditions are not favorable at the time of the merger, shareholders may see significant losses. 

Shareholders have been waiting for an opportunity to liquidate their shares of Corporate Property Associates 18 – Global Inc. for quite some time. The REIT’s share repurchase program is limited and oversubscribed and in August 2020, CPA 18 Global apparently limited the amount of cash available for its share repurchase program and subsequently announced that $20.8 million in repurchases went unfulfilled as of the date of its second quarter 2021 report. Further, the REIT has reduced its distributions for both Class A and C shares approximately 60% from prior levels, beginning during the second quarter of 2020.   

The company announced in September that as of June 30,2021 that its estimated net asset value per share was $8.91 per share for Class A common stock and $8.91 per share for Class C common stock.     

Shares of the publicly registered non-traded REIT were originally sold for $10.00 each.   

Investors may have claims  

 If your financial advisor unsuitably recommended an investment in Corporate Property Associates 18 – Global Inc., you may be able to recover your losses by filing a FINRA arbitration claim against the brokerage firm that recommended the investment.   

For a free consultation with one of our securities attorneys, please call the offices of The White Law Group at (888) 637-5510.   

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington.   

FINRA provides an arbitration forum for investors to resolve disputes. The White Law Group represents investors in FINRA arbitration claims throughout the country. Visit the firm’s homepage to learn more about the firm’s representation of investors.   

 To learn more, please see:

Investor Alert: Corporate Property Associates 18 – Global Inc. 

Did your Financial Advisor Recommend Investing in Non-Traded REITs?

 

 

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