For This Firm, Accessing Capital Is Private Matter

WASHINGTON, DC-At a time when most real estate companies are turning to the public markets and issuing IPOs to access capital, one smaller, public company has decided to go the private route. At year’s end, American Community Properties Trust took itself off the stock exchange, thanks to its acquisition by Federal Capital Partners.The transaction comes about after two years of strategizing by ACPT board members on the various ways to potentially unlock value in the company, reveals Steve Greissel, the former REIT’s chief executive officer. The firm was having liquidity issues not only due to the tightness in the credit markets but also because of its micro-cap REIT status–namely, the significant costs associated with being a public company and a lack of cash flow in its shares.

ACPT tapped FBR Capital Markets as its advisor and drilled into its options. “We came to the realization that the best way to move forward was to see whether we could find a private equity group or another entity who could take us private.”

FBR approached about 50 different groups and after numerous meetings the final contenders were whittled down to three. “We selected FCP because they are very focused on the Mid-Atlantic area, where most of our assets are; they were one of the few funds that had raised fresh capital in this environment; and they really bought into our strategy,” shares Greissel.