Sotherly partial greenshoe ups 8.25% preferred stock to $30 million

By Sarah Lizee

Olympia, Wash., May 1 – Underwriters for Sotherly Hotels Inc.’s recently priced $25-par series D cumulative redeemable perpetual preferred stock partially exercised their greenshoe, bringing the total deal size to $30 million, according to an 8-K filing with the Securities and Exchange Commission.

As previously reported, on April 11 the company priced $27 million of the preferred stock at par with a dividend of 8.25%.

The issue includes a $4.05 million greenshoe, of which $3 million has been exercised.

The deal, announced on April 8, matched the initial $27 million offering amount and came in at the low end of talk for a dividend of 8.25% to 8.5%.

Sandler O’Neill & Partners, LP is the lead bookrunner, and Janney Montgomery Scott LLC is the passive bookrunner.

The preferreds are redeemable on or after April 18, 2024 at par. Prior to that, they are redeemable within 120 days after a change-of-control event.

Sotherly Hotels plans to contribute the net proceeds to its operating partnership in exchange for newly classified series D cumulative redeemable preferred units of limited partnership interest in the operating partnership. Any remaining proceeds will be used for general corporate purposes.

The company plans to list the preferreds on the Nasdaq Global Market under the symbol “SOHON.”

Sotherly Hotels is a Williamsburg, Va.-based real estate investment trust with a focus on full-service hotels.

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