US Federal Properties Expected to Price IPO This Week

| About: US Federal (USFP)

US Federal Properties Trust (USFP), a developer and acquirer of properties, is expected to price its IPO this week.

Business Overview (from prospectus)

We are a newly organized, internally-managed real estate company formed to continue and grow our business of acquiring, developing, financing, owning and managing properties leased primarily to the United States of America, acting either through the General Services Administration, or GSA, or another federal government agency or department, carried out through our predecessor and related entities prior to this offering. Our senior management team is led by Richard Baier, the Chairman of our board of directors and our Chief Executive Officer, who, together with Daniel K. Carr, our Executive Vice President, Development, and Cathleen M. Baier, our Executive Vice President, Government Operations, founded our business. In 1998, Messrs. Baier and Carr began pursuing developments of build-to-suit federal government-leased properties. Ms. Baier joined Messrs. Baier and Carr in 2003 and together they developed build-to-suit federal government-leased properties under the name “BC Development.”

Offering: 13.8 million shares at $19 - $21 per share. Net proceeds of approximately $77.7 million will be used for debt repayment and approximately $137.4 million will be used for paying purchase price of acquisition properties.

Lead Underwriters: Deutsche Bank Securities (NYSE:DB), UBS Investment Bank (NYSE:UBS)

Financial Highlights:

So far the company has acquired properties and other real estate companies and has not generated revenue. All the cash flows are of the predecessor company.


Investing in and operating office buildings and maintaining relationships with federal government occupants and attracting new federal government occupants is a competitive business. We do not believe we have a dominant position in any of the geographic markets in which we operate, while some of our competitors are dominant in selected markets. Many of our competitors have greater financial and management resources than we have, and greater access to capital than we do. Because of the strong credit quality of our federal government tenant base, we face significant competition for acquisitions of single-tenant federal government-leased properties from many investors, including publicly traded REITs, high net worth individuals, commercial developers, real estate companies and institutional investors with more substantial resources and access to capital than we have. This competition may require us to accept less favorable terms (including higher purchase prices) in order to consummate a particular acquisition.

Additional Resources: