Changes In Reporting For Acquisitions By Non-Exchange Traded REITs

On December 9, 2008, the staff at the SEC (the "Staff") released their Financial Reporting Manual which includes the recent changes in reporting for acquisitions by blind pool non-exchange traded REITs summarized in our May 29, 2008 REIT Alert "SEC Seeks Improved Disclosure by Non-Exchange Traded REITs."¹ In short, the revised guidance requires non-exchange traded REITs to file financial statements that satisfy the requirements of Rule 3-14 for acquisitions made during the distribution period if these acquisitions represent 10% or more of their total assets as of the date of acquisition. Non-exchange traded REITs must file these financial statements no later than 71 calendar days after the date of the initial Form 8-K reporting the acquisition.² This Alert provides a summary of the revised guidance and highlights how it differs from the previous Staff interpretation.