Morning Commentary: Bluerock REIT sells preferreds; UMH deal ticks down

By Christine Van Dusen

Atlanta, Oct. 16 – New York’s Bluerock Residential Growth REIT Inc. sold new preferreds on a mostly quiet Friday morning for preferreds, which saw significant moves on Thursday afternoon after the larger stock market rebounded.

“Today, though, it’s relatively quiet,” a trader said.

Among the issues that did get some attention on Friday was UMH Properties Inc.’s 8% series B cumulative redeemable preferred stock (UMHPB) that priced at par of $25.

The preferreds traded Friday morning at about 24¾, the trader said.

The deal came smaller than the previously announced maximum size of up to $50 million and beyond the wide end of price talk that had been set at a dividend of 7.375% to 7.5%.

UMH sold 1,801,200 shares of the preferreds.

CSCA Capital Advisors LLC is the placement agent for the offering, which was announced on Oct. 5.

In its new deal, Bluerock printed $62.5 million of 8¼% series A cumulative redeemable perpetual preferred stock (BRGPA) at $25 per share, according to a company announcement.

Wunderlich Securities Inc. and Compass Point were the joint bookrunning managers. DA Davidson & Co. and Janney Montgomery Scott LLC were co-lead managers.

Dividends will be payable quarterly. Beginning October 2022, the dividend rate will increase by 2% annually and by another 2% for every year thereafter, up to a maximum amount of 14%.

Proceeds will be used for future investments and acquisitions and for general corporate and working capital purposes.

On Friday morning the new notes were seen at 101 7/8.

“Doing well,” the trader said.

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