Preferred Apartment to sell up to $900 million more preferreds

By Angela McDaniels

Tacoma, Wash., Oct. 15 - Preferred Apartment Communities, Inc. registered to sell up to $900 million of additional units of preferred stock and warrants in a follow-on offering, according to a company news release.

Each unit consists of one share of 6% series A redeemable preferred stock and one warrant to purchase up to 20 shares of the company's common stock.

The registration allows Preferred Apartment Communities to offer up to 900,000 units at a price of $1,000 per unit.

The units are being offered by dealer manager International Assets Advisory, LLC on a reasonable best-efforts basis.

Proceeds will be used to acquire multifamily properties and other real estate-related investments and for general working capital purposes.

As previously reported, the company issued $2.16 million of the units in April 2012 and expected subsequent closings on a monthly basis. It planned to sell up to $150 million of the units through the continuous public offering.

According to Tuesday's news release, the company expects that offering to terminate Dec. 31, at which time it will begin sales under the follow-on offering.

The warrants are exercisable for three years beginning one year after issuance. The exercise price will be a 20% premium over the current market price of the company's common stock on the issuance date, subject to a minimum of $9.00 per share. The current market price will be determined using the volume-weighted average price of the previous 20 trading days.

The company's common stock closed at $8.23 (NYSE MKT: APTS) on Tuesday.

Preferred Apartment Communities is an Atlanta-based company formed primarily to acquire and operate multifamily properties.

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