The Real Deal New York

CIM Group to join Tel Aviv Stock Exchange to issue stock

This is the first US-based REIT to dual-list in Israel
By Chava Gourarie | May 23, 2017 06:14PM

Shaul Kuba and Avi Shemesh

The real estate investment trust CIM Commercial Trust Corp will be the first U.S. real estate fund to be traded on the equities market in Israel — if accepted to the exchange.

Earlier this month, the REIT, which trades on the NASDAQ as CMCT, registered a new security with the SEC that will be issued on the Israeli market. They simultaneously filed with the Israeli financial regulatory bodies to be listed on the TASE.

As is standard for the tender process in Tel Aviv, CIM held an auction for a group of early investors that will decide the minimum price for the stock, while the final price will be decided in a public tender. Both the common and preferred stock will be listed on the NASDAQ and TASE, but the preferred equity will be marketed only in Israel, according to the SEC filing.

Israeli business publication TheMarker first reported on the plans.

CIM TRData LogoTINY did not comment on the amount they intend to raise, but a source close to the deal said that with a market cap of $1.3 billion, they have the capacity to raise several hundred million dollars. CMCT is expected to pay a quarterly dividend on the stock.

This structure differs from other U.S. real estate companies on the TASE, who have all issued debt, and most of whom are private companies in the states.

One Ha’am is advising CIM on the deal, and Bank Leumi will be the underwriters. CIM was not immediately available for comment.

CIM, led by principals Avi Shemesh, Shaul Kuba and Richard Dressler, is active primarily on the West Coast, but has been involved in some of New York’s biggest deals as well. CIM has either co-developed or backed such projects as 432 Park Avenue, 737 Park Avenue, 305 East 51st Street, One Madison and 100 Barclay Street. In February, Japanese trading conglomerate Mitsui & Co. took a 20 percent stake in the firm, and committed to a $450 million to $550 million capital investment into the company’s investment funds.