Updates Estimated Aggregate Shareholder
Liquidating Distribution Range to $20.55 to $20.70 Per Common
Share
Equity Commonwealth (NYSE: EQC) (the “Company”) announced today
that it closed on the sale of its last remaining property, 1225
Seventeenth Street, a 709,402 square foot office property in
Denver, Colorado, for a gross sale price of $132.5 million, on
February 25, 2025. The net purchase price was approximately $124.4
million after credits primarily for contractual lease costs. With
this sale of its last remaining property, the Company is also
updating the estimated aggregate shareholder liquidating
distribution range from an estimated aggregate shareholder
liquidating distribution range of $20.00 to $21.00 per common share
previously announced on November 15, 2024, to an estimated
aggregate shareholder liquidating distribution range of $20.55 to
$20.70 per common share, inclusive of the initial liquidating
distribution of $19.00 per common share paid by the Company on
December 6, 2024.
The Company also reported its financial results as of December
31, 2024 under the liquidation basis of accounting, and the Company
will file a Form 10-K with its results for the year ended December
31, 2024.
Liquidation Status
On October 2, 2024, the Company filed a definitive proxy
statement (the “Definitive Proxy”) with the Securities and Exchange
Commission related to a special meeting of shareholders to, among
other things, consider and vote upon the Plan of Sale and
Dissolution of the Company (the “Plan of Sale”), including the
wind-down and complete liquidation of the Company, and the
dissolution and termination of the Company, including the
establishment of a Liquidating Entity (as defined in the Definitive
Proxy). The Plan of Sale, which the Board determined was in the
best interests of the Company and its shareholders, authorizes the
Company to sell its remaining properties, wind-down the Company’s
affairs and distribute the net proceeds to shareholders. At the
special shareholder meeting held on November 12, 2024, the
Company’s shareholders approved the Plan of Sale with 85.5% of
outstanding shares, and 99% of votes cast, in favor of the Plan of
Sale proposal (two-thirds of outstanding shares required for
approval).
Financial Results
Liquidation Basis of Accounting
Pursuant to the Company’s shareholders’ approval of the Plan of
Sale, in accordance with Generally Accepted Accounting Principles,
the Company adopted the liquidation basis of accounting as of and
for the periods subsequent to November 1, 2024. The liquidation
basis of accounting requires, among other things, that management
estimate net sales proceeds on an undiscounted basis as well as
include in the Company's assets and liabilities the undiscounted
estimate of future revenues and expenses through the end of the
liquidation. The net assets in liquidation at December 31, 2024
were approximately $179 million. Net assets in liquidation include
projections of costs and expenses to be incurred during the
estimated period required to complete the Plan of Sale. There is
inherent uncertainty with these estimates and projections, and they
could change materially based on, among other things, changes in
the underlying assumptions of the projected cash flows.
Significant Events During 2024
Pursuant to the Plan of Sale, the Company has, among other
things, completed the following as part of its efforts to
facilitate the efficient wind-down of its business:
- Paid the liquidation preference to the holders of shares of the
Company’s 6.50% Series D Cumulative Convertible Preferred Shares of
beneficial interest, par value $0.01 per share (the “Series D
Preferred Shares”), constituting all amounts due and owing such
holders on December 3, 2024. The Series D Preferred Shares have no
right or claim to any of the remaining assets of the Company. A
Form 25 was filed with the SEC to effect the withdrawal of the
listing of the Series D Preferred Shares from the New York Stock
Exchange.
- Paid common shareholders an initial cash liquidating
distribution of $19.00 per common share on December 6, 2024.
- Sold three of the four remaining properties, namely 1250 H
Street, NW in Washington DC, and 206 East 9th Street and
Bridgepoint Square in Austin, Texas.
Subsequent Events Pursuant to the Plan of Sale
On February 25, 2025, the Company sold its last remaining
property, 1225 Seventeenth Street Plaza, in Denver, Colorado.
Earnings Conference Call
Equity Commonwealth will host a conference call to discuss 2024
results on Thursday, February 27, 2025, at 1:00 P.M. CT. The
conference call will be available via live audio webcast on the
Investor Relations section of the company’s website
(www.eqcre.com). A replay of the audio webcast will also be
available following the call.
About Equity Commonwealth
Equity Commonwealth (NYSE: EQC) is a Chicago based, internally
managed and self-advised real estate investment trust (REIT).
Regulation FD Disclosures
We use any of the following to comply with our disclosure
obligations under Regulation FD: press releases, SEC filings,
public conference calls, or our website. We routinely post
important information on our website at www.eqcre.com, including
information that may be deemed to be material. We encourage
investors and others interested in the company to monitor these
distribution channels for material disclosures.
Forward-Looking Statements
Some of the statements contained in this press release
constitute forward-looking statements within the meaning of the
federal securities laws. Any forward-looking statements contained
in this press release are intended to be made pursuant to the safe
harbor provisions of Section 21E of the Securities Exchange Act of
1934, as amended. Forward-looking statements relate to
expectations, beliefs, projections, future plans and strategies,
anticipated events or trends and similar expressions concerning
matters that are not historical facts. You can identify
forward-looking statements by the use of forward-looking
terminology, including but not limited to, “may,” “will,” “should,”
“could,” “would,” “expects,” “intends,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” or “potential” or the negative
of these words and phrases or similar words or phrases which are
predictions of or indicate future events or trends and which do not
relate solely to historical matters. You can also identify
forward-looking statements by discussions of strategy, plans or
intentions.
The forward-looking statements contained in this press release
reflect our current views about future events and are subject to
numerous known and unknown risks, uncertainties, assumptions and
changes in circumstances that may cause our actual results to
differ significantly from those expressed in any forward-looking
statement. We do not guarantee that the transactions and events
described will happen as described (or that they will happen at
all). We disclaim any obligation to publicly update or revise any
forward-looking statement to reflect changes in underlying
assumptions or factors, of new information, data or methods, future
events or other changes. For a further discussion of these and
other factors that could cause our future results to differ
materially from any forward-looking statements, see the section
entitled “Risk Factors” in our most recent Annual Report on Form
10-K and subsequent quarterly reports on Form 10-Q.
CONSOLIDATED STATEMENT OF NET
ASSETS
(Liquidation Basis, amounts in
thousands)
December 31, 2024
ASSETS
Real estate
$
132,500
Cash and cash equivalents
160,511
Rents receivable and other assets
613
Total assets
$
293,624
LIABILITIES
Liabilities for estimated costs in excess
of estimated receipts during liquidation
$
100,019
Accounts payable and accrued expenses
10,908
Distributions payable
3,842
Total liabilities
$
114,769
Net assets in liquidation attributable to
Equity Commonwealth common shareholders
178,605
Net assets in liquidation attributable to
noncontrolling interest
250
Net assets in liquidation
$
178,855
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250226929018/en/
Bill Griffiths (312) 646-2801 ir@eqcre.com
Equity Commonwealth (NYSE:EQC)
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