RAIT In Deal With Independence Realty Trust To Internalize Management

(RTTNews) - RAIT Financial Trust (RAS) announced Tuesday that it has entered into a definitive agreement to sell its unit Independence Realty Advisors, LLC, and certain assets of unit Jupiter Communities, LLC to Independence Realty Trust, Inc. (IRT) for $43 million.

Independence Realty Advisors is the external advisor of Independence Realty Trust or IRT. The company said the deal permits IRT to internalize its advisor and property management functions.

In addition, RAIT has agreed to sell back to IRT approximately 7.3 million common shares in IRT that RAIT currently owns. Based on the current market price of IRT's common stock, the total proceeds to RAIT including the sale of RAIT's shares in IRT is expected to be approximately $120 million, before fees and expenses.

RAIT expects the purchase of its IRT shares by IRT to close within one month and the Internalization Transaction to close around year-end 2016.

Effective upon closing of the deal, Scott Davidson, RAIT's current President, will become the Chief Executive Officer of RAIT and will serve on the Board of Trustees. Scott Davidson has been with RAIT since 2010, serving in various capacities, including Managing Director and President.

Scott Schaeffer, RAIT's current Chief Executive Officer and Chairman, will become the full time Chairman and Chief Executive Officer of IRT. Schaeffer will serve as a consultant to RAIT for the twelve months following the closing of the deal.

James Sebra, RAIT's current Chief Financial Officer, will continue as Chief Financial Officer of RAIT.