Safehold Turns Lower on Stock Offering

Safehold Inc (NYSE:SAFE) reported a two-million share common stock offering Monday.

The New York-based Safehold announced that it has commenced an underwritten public offering to sell 2,000,000 shares of its common stock. The Company intends to grant the underwriters in the offering a 30-day option to purchase up to an additional 300,000 shares of its common stock.

Concurrently with the completion of the public offering, the Company will sell to iStar Inc. (NYSE:STAR), in a private placement, a number of shares of common stock equal to 65% of the total number of shares sold in the offering and the concurrent private placement (including any shares sold pursuant to the underwriters' additional purchase option) up to a maximum aggregate purchase price of $130 million, at the public offering price per share and subject to rounding.

The Company intends to use the net proceeds from the offering and concurrent private placement to make additional ground lease investments.

Goldman Sachs & Co. LLC, BofA Securities, J.P. Morgan, Barclays, and Mizuho Securities will act as joint book-running managers for the offering.

Also Monday, Safehold announced has entered into a definitive agreement with an institutional investment manager to create a new $180 million Safehold™ ground lease under the office property on Third Avenue in New York City. The transaction is expected to close by the end of the year.

Safehold is a publicly traded REIT that originates and acquires ground leases in order to generate attractive long-term risk-adjusted returns.

Its shares dropped $1.24, or 3.5%, to $34.69, while STAR shares notched higher three cents to $12.22