Essential Properties Is Said to Hire Citi, Goldman for IPO

(Bloomberg) -- Essential Properties Realty Trust has hired Citigroup Inc. and Goldman Sachs Group Inc. to explore an initial public offering, according to people with knowledge of the matter.

An IPO could come this year, said one of the people, who asked not to be named because the matter is private. Representatives for Essential Properties and Goldman Sachs declined to comment on the plans. A Citigroup representative didn’t immediately respond to a request for comment.

Essential Properties, based in Princeton, New Jersey, has a management team that’s well-known by REIT investors. President and Chief Executive Officer Pete Mavoides, Chief Operating Officer Gregg Seibert and Chief Financial Officer Hillary Hai all previously worked at Spirit Realty Capital Inc., another large triple-net-lease REIT. Earlier this year, Essential Properties hired Daniel Donlan, a longtime REIT equity analyst, as senior vice president for capital markets.

The company owns 530 properties across 42 U.S. states, according to its website. It targets such tenants as quick-service restaurants, medical and veterinary facilities, and car washes. Essential Properties’ buildings are leased to businesses that “exhibit favorable growth characteristics and are generally insulated from e-commerce pressure,” according to the company’s website. Occupants include movie theater operator AMC Entertainment Holdings Inc., McDonald’s Corp., Mister Car Wash and Aspire Fitness, according to the website.

Few real estate investment trusts have gone public in the U.S. this year, in part because some investors have pared their holdings amid rising interest rates. Americold Realty Trust, which provides storage for perishable goods, went public in January and has risen 29 percent since its debut. Another REIT, Industrial Logistics Properties Trust, has declined 15 percent since its IPO, also in January. The two companies raised a combined $1.3 billion, according to data compiled by Bloomberg on IPOs bigger than $50 million. Last year, five REITs raised a total of $2.2 billion through IPOs.

To contact the reporters on this story: Gillian Tan in New York at gtan129@bloomberg.net, Alex Barinka in New York at abarinka2@bloomberg.net.

To contact the editors responsible for this story: Daniel Taub at dtaub@bloomberg.net, Steve Dickson

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