MVP REIT II Launches $50 Million Preferred Stock Offering

MVP REIT II Inc., a non-traded real estate investment trust that invests in parking lots and facilities, has commenced a private placement offering for up to $50 million in shares of convertible redeemable preferred stock.

Accredited investors may purchase one share of preferred stock for $1,000. MVP REIT II will also issue warrants to acquire 30 shares of its common stock for each share of preferred stock. The minimum purchase is $10,000, equal to 10 shares of preferred stock plus 300 warrants to purchase an equivalent shares of common stock “upon listing on a public stock exchange.”

While the offering is for up to $50 million, according to a filing with the U.S. Securities and Exchange Commission, the size of the offering “shall not exceed 60 percent of the total value of the then issued and outstanding shares of the REIT’s common stock.”

As previously reported by The DI Wire, MVP REIT II’s initial public offering is scheduled to end on December 31st, and the REIT has engaged investment banking firm Ladenburg Thalmann & Co. Inc. to act as its strategic advisor to explore various courses of action for the company, including possibly listing its common stock on a national securities exchange.

MVP REIT II will pay an annual dividend equal to 5.75 percent of the stated value of the preferred shares, which they expect to pay monthly. According to the private placement memorandum, should the company’s common stock not be listed on a national stock exchange within 12 months of the final closing of the preferred offering, the dividend will increase to an annual rate of 7.50 percent, which will revert back to 5.75 percent upon listing. The offering is scheduled to continue until full subscription or two years from the date of the first purchase of the shares, whichever occurs first.

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