Nova Net Lease REIT (OTC:NNLRF) in Focus After Latest News
Investors who may be looking into innovative companies at this point could do well to follow Nova Net Lease REIT (OTC:NNLRF) this week. The company operates as a real estate investment trust focused specifically on delivering interesting financing options to high-quality cannabis operators in the United States.
Last Friday, the company hit the news cycle after it announced that, through some of its subsidiaries, it had entered into a joint venture with a Nevada-based real estate group. It was further revealed that the company’s joint venture partner was going to contribute two properties with a combined valuation of $15.7 million to the joint venture.
It could be a good move to take a closer look into some of the highlights of the joint venture, which were shared by Nova Net Lease REIT in the news release. The joint venture between the parties had been structured in the form of a limited partnership in which Nova Net Lease REIT was the designated general partner. The company also received a 15% LP interest in the venture.
The Nevada-based joint venture partner would receive around $8.9 million in the form of limited partnership units priced at $1.25 each. Those partners would eventually be able to exchange those units for units in the REIT in a 1:1 ratio. The cash flow to the REIT would add around $0.03 in the form of an AFFO unit.
The joint venture would be in existence for a period of three years. Once the JV Partner units are converted to REIT units, the acquisition properties would raise the size of the REIT as a whole, it was revealed. The size of the REIT would go up to three properties from two properties, and the pro forma valuation of the total assets would jump to around $28 million from $12 million.
