Who is RAIT Investment Trust?
How is RAIT different than most other REITs?
What type of loans does RAIT offer?
RAIT originates loans that are typically “non-conforming”, what does this mean?
Why do we consider ourselves an equity alternative?
What has RAIT done to protect its balance sheet against rising interest rates?
How does RAIT manage credit risk?
Who are RAIT’s competitors?
How does RAIT raise money for growth?
What is RAIT’s dividend policy?
When is the dividend paid?
What is the ex-dividend date?
Which Wall Street analysts cover RAIT Investment Trust?
Who is RAIT's transfer agent?
Who is RAIT's independant auditor?
Who is RAIT Investment Trust?
- RAIT Investment Trust (“RAIT”) is a public company traded on the New York Stock Exchange under the ticker RAS. Formed in August of 1997, RAIT went public in January 1998.
- RAIT is a direct lender and acquire of commercial real estate which generates income for distribution to shareholders from a combination of interest on loans we’ve originated, rents from properties that we own, income from properties in which we have an equity interest, and proceeds from the sale of our investments.
RAIT generates income from three principal business activities:
- RAIT makes real estate loans directly to borrowers
- RAIT acquires real estate loans from others
- RAIT acquires real properties or interests in real properties
- RAIT is organized as a real estate investment trust (REIT). REITs receive special tax treatment from the IRS. They do not have to pay corporate taxes on the money paid out as dividends to shareholders.
How is RAIT different than most other REITs?
REIT industry analysts often classify REITs in one of three investment approaches:
Equity REITs own real estate. Their revenue comes principally from rent. Property types include: shopping centers, apartments, warehouses, office buildings, hotels, etc.
Mortgage REITs loan money to real estate owners. Their revenue comes principally from interest earned on their mortgage loans. Annaly Mortgage Management is a Mortgage REIT.
Hybrid REITs combine the investment strategies of both equity REITs and mortgage REITs.
RAIT, a hybrid REIT, originates mortgages and invests equity in commercial real estate. RAIT deals with the physical property whether RAIT originates a loan or makes an equity investment. RAIT management brings real expertise in financing and managing real property.
RAIT focuses in on the mid-sized commercial real estate transaction generally between $2-$30 million. Large institutions typically don’t make loans this size. RAIT works closely with its customers and generates repeat business by creating financing solutions that meet the needs of its clients that gets them to close quickly and efficiently.
What type of loans does RAIT offer?
RAIT provides structured financing using the following loan types:
RAIT originates loans that typically do not conform to the criteria of institutional lenders and lenders that securitize loans, what does this mean?
Institutional lenders and lenders that securitize loans have a certain lending criteria that loans must fit in order for them to be considered for funding. RAIT has the flexibility, creativity and experience in structuring transactions which produce returns for its shareholders where banks and larger institutions won’t pursue because the loan parameters exist outside their lending criteria.
Why do we consider ourselves an equity alternative?
RAIT is an alternative to equity. We help private and corporate owners of real estate raise capital without giving up control or ownership. Many commercial property owners are faced with extremely high prepayment penalties (15% to 20%) on their existing debt that make it prohibitively expensive to refinance. In order to take advantage of lower rates, they might choose to take on some subordinated financing like mezzanine debt. The cost of bringing on debt compared to raising equity is much more favorable and allows the property owner to maintain control.
What has RAIT done to protect its balance sheet against rising interest rates?
RAIT’s balance sheet is match funded to minimize interest rate risk. RAIT utilizes interest rate hedging mechanisms (swaps and caps) to lock in spreads and to manage the changing interest rate environment.
Historically, RAIT has delivered a consistent dividend in various interest rate environments.
How does RAIT manage credit risk?
In order to minimize the credit risk associated with RAIT’s investments and maximize returns to our shareholders, we actively monitor the status of the portfolio and we utilize a thorough underwriting process, which focuses on current cash flow, asset allocation, and the financial condition of the property and credit worthiness of the tenants. Location is a key element in managing credit risk since we focus on mature markets with limited supply and stable environments (low vacancy). Operational oversight, including detailed monthly reporting, a lockbox on property cash flow and management of escrows allows us to closely monitor all investments.
To date, RAIT has not had a default in its portfolio.
Who are RAIT’s competitors?
RAIT has found a niche serving commercial real estate owners along the Eastern corridor and Mid-Atlantic Region looking for structured financing between $2 to $30 million. Though there is greater competition in the general real estate environment, our focus, depth, size and experience differentiate us from most lending groups, banks and institutions.
How does RAIT raise money for growth?
- RAS sells securities in the public markets to invest in commercial real estate.
- Investors buy stock directly from RAIT and reinvest their dividends via the DRIP and Share Purchase Plan
- Increase leverage to a comfortable level
What is RAIT’s dividend policy?
RAIT strives to deliver a consistent dividend to its shareholders. Since inception, RAIT has never lowered the dividend.
When is the dividend paid?
The dividend is paid quarterly. Click here for dividend history.
What is the ex-dividend date?
The ex-dividend date is the date upon which the stock begins trading without rights to the next dividend payment. Typically, the ex-dividend date is two business days before the record date, unless the intervening business day is one on which the NYSE is closed. The record date is announced in our dividend press releases.
Which Wall Street analysts cover RAIT Investment Trust?
Friedman, Billings, Ramsey & Co., Inc. – Merrill Ross
US Bancorp Piper Jaffray – Robert P. Napoli
Stifel, Nicolaus & Co., Inc. – Joseph A. Stieven
Who is RAIT's transfer agent?
American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, NY 10038
1-800-937-5449
Who is RAIT's independant auditor?
Grant Thornton LLP
