Slate Grocery REIT Eyes Firm’s Future After Takeover Bid

After an unsolicited takeover bid, the future of Slate Grocery REIT is coming into question.

The board of trustees at the Toronto-based real estate investment trust recently formed a special committee to evaluate strategic alternatives for the company, Bisnow reported. The formation comes on the heels of an offer from private affiliates of Slate Asset Management, the external manager of Slate Grocery.

“We are focused on finding a path that maximizes value for all unitholders,” Slate Grocery board chair Andrea Stephen said in a statement.

The REIT did not respond to a further request for comment from the publication.

While based north of the United States-Canada border, Slate Grocery’s assets span 15.2 million square feet across 23 states, valued at $2.4 billion.

Almost half of the properties are in the Southeast United States. Nearly a fifth of the portfolio is occupied by Kroger and Walmart and almost 95 percent of the portfolio is occupied as of the end of the first quarter.

The company’s stock jumped roughly 6 percent on the news of the strategic alternatives, though that rise cooled down after Memorial Day Weekend. As of 12:55 PM ET on Tuesday, the stock was trading at $16.86 per share; the stock is up more than 10 percent year-to-date and the company’s market value is hovering around the $1 billion mark.

Slate Asset Management boasts 12.8 billion Canadian dollars in assets under management and has completed CA$28.7 billion in acquisitions between its inception in 2005 and the end of last year.

As more REITs get in on a rise in consolidation among commercial real estate players, the perceived safety of grocery-anchored assets in the retail real estate sector has made them a popular investment commodity.

In March, Nuveen Real Estate — the investment arm of the Teachers Insurance and Annuity Association of America-College Retirement Equities Fund (TIAA) — raised $330 million for its U.S. Cities Retail Fund, to be deployed on grocery-anchored shopping centers.

Other real estate investors, including SJC Ventures and a partnership between Bain Capital Real Estate and 11North Partners, recently made their own major moves in the segment.

— Holden Walter-Warner