Acadia REIT Hangs On by Lesley Hensell
Managers at Acadia Realty Trust (NYSE: AKR) can breathe a sigh of relief. The real estate investment trust, which specializes in shopping centers, has convinced nine institutional investors to hold onto the company's stable yet dull stock. Over the last year, Acadia's shares have hovered between $4 3/8 and $5 ¾ on rather slim volume averaging about 15,000 shares per day. Of course, this low volume results in part from the participation of the institutional investors, who hold more than 16 million shares representing almost 64 percent of outstanding common shares. In August 1998, these institutions invested more than $100 million to recapitalize the company. Their lock-up agreement was set to expire during the first quarter of 2000, which would have thrown millions of shares on a market that currently cares little for penny-stocks and REITs, resulting in two strikes against Acadia. But the investors have instead agreed to continue its terms until the end of the year. "Our institutional investors have given a strong vote of confidence to our management team," said Kenneth Bernstein, president of Acadia. "This decision reflects their support of our initiatives to both maximize the value of our properties and close the gap between our net asset value and our stock price. The support of these investors has been extremely helpful in allowing our team the latitude to execute our turnaround plan which is already resulting in strong earnings growth and portfolio improvements." Headquartered on Long Island, Acadia is a self-administered equity REIT structured as an UPREIT, which specializes in the operation, management, leasing, renovation and acquisition of shopping centers and multi-family properties. The company currently owns and operates 57 properties totaling approximately 11 million square feet, primarily in the eastern half of the United States. And speaking of investors, a new barter economy is springing up around the Internet, resulting in equity exchanges, work-for-stock and other agreements rarely seen outside the electronic world. Case in point: Capital Title Group, Inc. (Nasdaq: CTGI) and privately held 9keys.com have planned an equity exchange. The two companies plan to form an alliance to "optimize the use of their respective technologies and the multiple services they provide the real estate industry, enhancing the growth performance of each of the companies." In other words, they are going to get together and see what they can make work. Capital Title Group is a regional provider of title insurance, escrow and real estate-related services for residential and commercial transactions. 9keys.com is one of the fastest-growing financial and real estate groups in the United States with 1999 sales of $1.5 billion. And in the land of beautiful people, California-based Sonoma Spa Resorts, L.P., has collaborated with Crescent Real Estate Equities Company (NYSE:CEI) to form a high-end hospitality management company and investment partnership to be led by Sanjay and Johanna Varma. Crescent will hold a 30 percent interest in the management company and a 93 percent interest in the investment partnership, while the Varmas will hold the remainder. The objective of the new companies, which will be based in Northern California, is to acquire, develop and manage a collection of "unique and irreplaceable luxury spa resorts and hotels" and operate them under the "Sonoma Spa Resorts" brand and concept. | 
