(Bloomberg) GO Residential Real Estate Investment Trust is expected to begin trading Friday after pricing its $410 million initial public offering, in what would be the first corporate IPO on the Toronto Stock Exchange this year.
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The offering consisting of 27.34 million units priced at $15 each, according to a statement Thursday confirming an earlier Bloomberg News report. The REIT will indirectly own a portfolio of luxury high-rise apartments in New York City, and plans to use the proceeds of the IPO to acquire them, according to a preliminary prospectus filed with Canadian securities regulators July 11.
The deal marks the first IPO in Canada to raise more than $50 million since the $215 million offering for womens clothing retailer Groupe Dynamite Inc. in November, a public debut that ended a long dry spell for listings on the Toronto Stock Exchange.
GO Residentials IPO was significantly oversubscribed, with share allocations heavily skewed to long-only investors, according to one of the people, who asked not to be identified as the information isnt public.
Institutional investors were allocated 85% of the shares available, and about 60% of those buying shares were Canadian, versus 40% US, the person said. The 10 largest accounts took about 60% of the shares on offer, they said.
A representative for GO Residential didnt immediately respond to requests for comment.
The REIT expects to make monthly cash distributions equating to an annual yield of about 4.26%, according to the preliminary prospectus. It expects to make its first distribution on Sept. 15, the statement shows.
In connection with the IPO, funds managed by Cohen & Steers Capital Management Inc. had agreed to buy 6 million units in a private placement at the offering price for proceeds of $90 million, the preliminary prospectus showed.
GO Residential chairman Meyer Orbach is also a part-owner of the NBAs Minnesota Timberwolves, and Chief Executive Officer Joshua Gotlib was previously CEO of Manhattan real estate investment firm Black Spruce LLC.
GO Residential REIT had net property income of $32.4 million on property revenue of $38.3 million for the quarter ending March 31, according to the preliminary prospectus, which shows financial results before the acquisition of the Manhattan properties. The company is forecasting $10.3 million in net income on $174.4 million in revenue after the deal closes in June 2026.
The offering is being led by Canadian Imperial Bank of Commerce and Bank of Montreal, according to a statement. Bank of America Corp., Royal Bank of Canada, National Bank of Canada, Bank of Nova Scotia, Desjardins Capital Markets, Canaccord Genuity Corp., and BTIG are also working on the deal. The REIT plans for its shares to trade on the Toronto Stock Exchange under the symbol GO.U.
(Updates with trading confirmation in first two paragraphs, distribution in seventh paragraph.)
