Boise Idaho real estate firm loses $200M in IPO – FT
Boise, Idaho (AP) A Boise real estate company that specializes in commercial real estate sold its stock Thursday to a hedge fund that specializes on municipal bonds, as part of a deal that would raise $200 million in a public offering.
The Boise City Council approved the deal with the Idaho Real Estate Investment Trust on Wednesday night.
The company, Boise River Capital, will receive $1.3 billion in cash and 2.2 million shares of the company’s common stock, according to a release from the city.
The fund, known as the Boise River Venture Capital Fund, had about $1 billion in assets at the end of March.
The city said the funds total is a fraction of the $1 trillion in municipal bonds in the state.
The City of Boise will invest the proceeds from the offering in an “important capital improvement project,” city spokesman Steve Wiebe said in a statement.
Boise River has been a strong performer in Idaho’s real estate market, said John Coyle, managing partner of the Boise-based firm.
“We’ve had a good couple of years and we’ve been on a lot of hot streak,” Coyle said.
“It was a pretty great fit for us.”
The company was formed in 2012 and it’s owned about 2,200 properties, including Boise River’s home at the corner of Idaho and Boise streets.
The new public offering would be the largest in Idaho history, according a news release from Boise City.
The stock will be sold in a private-equity offering.
Boise is the latest city in the U.S. to try to get into the real estate game after years of slow growth.
In April, the city of New York said it was buying out its city-owned mortgage lender for $2.3 million.
That deal is set to close in July.
A number of cities in the Pacific Northwest are considering taking the plunge.
“I don’t think it’s going to be a huge shock to any of us,” Caine said.
The New York deal came at a time when the housing market was hitting record lows.