Stock Offering by Gladstone Commercial

Zacks

Gladstone Commercial Corp. (GOOD) declared an underwritten public offering of 1.1 million shares. Additionally, this real estate investment trust anticipates the underwriters to be provided with a 30-day option to purchase up to an additional 165,000 common shares to cover any over-allotments.

The proceeds from the offering will be primarily utilized to fund the pending and future property acquisitions, which shall include the purchase of a 320,597 square foot office building in Texas. Additionally, the proceeds would be used for the repayment of debt and general business purposes.

The sole book-running manager for the offering is Janney Montgomery Scott LLC. Alongside, Oppenheimer Holdings Inc. (OPY) will serve as the joint lead manager.

Though the intention of repaying debt is encouraging as it will lessen the company’s interest expenses, the offering would result in share dilution for Gladstone.

Earlier, in 2011, Gladstone Commercial declared the sale of one million common shares through an underwritten public offering.

Some other firms that recently announced a public offering include CommonWealth REIT (CWH) and Chatham Lodging Trust (CLDT).  CommonWealth declared a public offering of 27 million shares. The company also anticipates that the underwriters will be provided a 30-day option to buy up to an additional 4 million common shares.

On the other hand, Chatham declared a public offering of 4.5 million common shares of beneficial interest, with a par value of one cent per share. Further, to cover any over-allotments, the company furnished a 30-day option to underwriters to buy up to an additional 675,000 shares.

Gladstone currently carries a Zacks Rank #4 (Sell).
 

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