Welltower plans to adopt UPREIT structure to aid in property acquisitions
Mar. 07, 2022 8:48 AM ETWelltower Inc. (WELL)FRTBy: Liz Kiesche, SA News Editor
- Welltower (NYSE:WELL) plans to change its structure so that its current real estate investment trust becomes a wholly owned unit of a new umbrella partnership REIT, or UPREIT, a move intended to help it compete in acquiring real estate assets.
- The conversion won't affect its existing shareholders, debt security holders, lenders, or other constituencies, the health care REIT said.
- "We believe that the conversion will further expand our already robust external growth pipeline, as OP units potentially offer a unique tool for sellers seeking tax deferral and advanced tax planning," said Shankh Mitra, Welltower's (WELL) CEO and chief investment officer.
- The UPREIT structure will allow owners of appreciated property to contribute the property to an operating partnership in exchange for partnership interests. That type of transaction may be done on a tax-deferred basis for contributors.
- The reorganization isn't anticipated to have any impact on the financial position of Welltower (WELL) and will not result in any changes to the combined financial statements of the company, its outstanding debt securities, or business operations, it said.
- Late last year, Federal Realty (NYSE:FRT) announced plans to reorganize into an UPREIT structure