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Section 1: 8-K (8-K)

Document



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
_________________________________
FORM 8-K
_________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 30, 2018
_________________________________
Strategic Realty Trust, Inc.
(Exact name of Registrant specified in its Charter)
_________________________________
Maryland
000-54376
90-0413866
(State or other jurisdiction of
incorporation or organization)
(Commission File Number)
(IRS Employer
Identification No.)
66 Bovet Road, Suite 100
San Mateo, California, 94402
(Address of Principal Executive Offices, including Zip Code)
Registrant’s telephone number, including area code: (650) 343-9300
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨





Item 7.01. Regulation FD Disclosure.
On May 30, 2018, Strategic Realty Trust, Inc. posted a shareholder newsletter to its website. A copy of this newsletter is provided at Exhibit 99.1 to this Current Report on Form 8-K.
The information in this report, including Exhibit 99.1, is being furnished pursuant to item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
Item 9.01. Financial Statements and Exhibits.
Exhibit Number
 
Description
 
Shareholder Newsletter, dated May 30, 2018





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
STRATEGIC REALTY TRUST, INC.
 
 
 
Dated: May 30, 2018
By:
/s/ Andrew Batinovich
 
 
 
Andrew Batinovich
 
 
 
Chief Executive Officer



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Section 2: EX-99.1 (EXHIBIT 99.1)

ex991shareholdernewsmay1
66 Bovet Road Suite 100 San Mateo, CA 94402 650-343-9300 SRTREIT.com SHAREHOLDER NEWSLETTER                                        May 30, 2018 Urban Remedy – 450 Hayes, SF Fulton Street Shops‐ San Francisco Important Dates Most Recent 10Q Filing 5/11/2018 Next 10Q Filing Deadline 8/14/2018 Next Shareholder Newsletter 8/15/2018 Last Distribution Payment 4/30/2018 Next Distribution Payment 7/31/2018 Dear Fellow Shareholder, We continue to pursue the Company’s strategic plan to Legacy Property Sales Update build a core portfolio of high-quality west coast urban retail properties with solid growth prospects, strong predictable At Topaz in Hesperia, CA we have completed a lot split and cash flows and with visible value appreciation we have marketed the single tenant medical building for sale characteristics. As we discussed in the last newsletter, our and have received offers at the higher pricing we expected near-term goal is to complete the recycling of the portfolio to achieve by selling the parcel separately. We will hold the by selling the remaining legacy properties. balance of the center for now as we wait for some other Urban Core Portfolio Update tenants to take occupancy. Our core urban portfolio is 93% leased with one suite vacant. We are marketing Florissant in St Louis, MO, Ensenada in The average rent per square foot is $65.33 per year triple Arlington, TX and Turkey Creek in Knoxville, TN and hope to be net. As is typical with retail leases, our tenants will also pay in in contract soon on all three properties. As we complete the addition to the rent, a percentage of their sales if they hit sales we continue to look for opportunities to reinvest in our certain financial breakpoints. Although many of these are core urban retail markets. Since the beginning of 2016, we relatively new leases, a number of our tenants are currently have invested in eight new urban retail properties in our core paying percentage rents are starting to achieve those markets of San Francisco and Los Angeles. The properties are targets or are very close. high quality and fit our strategic vision; they are extremely well located in high density urban settings with strong We did have one lease default last lease year but demographics and with high pedestrian and vehicle traffic. fortunately it was an under-market lease. We were able to release a portion of the space to a very high-quality tenant We continue to be excited about the portfolio and its at a market rent and significantly increase our income on strategic direction. A fully recycled and focused high-quality that portion of the vacated space. west coast urban retail portfolio will hopefully allow us the opportunity to look at various strategic options for the future. Two of our new restaurant tenants in San Francisco, A Mano and Robin were named to the San Francisco Chronicle Top Sincerely, 100 restaurant list in their first year. Strategic Realty Trust, Inc Redevelopment Projects On the Wilshire Boulevard project in Santa Monica, our joint venture development partner has fully leased the second floor of the project to a fitness operator. As soon as we are Andrew Batinovich able to conclude a lease with a restaurant operator for a portion of the ground floor, we will be ready to go to construction. Our development partner also recently Strategic Realty Trust is a non‐traded real estate investment trust and is focused received approval of its site plan from the city for the on building a portfolio of high quality urban and street retail properties in major supermarket build to suit on Sunset Blvd in Hollywood and west coast markets. For more information please visit the Company’s website at they are working with Gelson’s on hopefully final changes to www.srtreit.com. The Company is advised by SRT Advisors, LLC an affiliate of site plans and lease documents. Glenborough, LLC. Glenborough also acts as the Company’s property manager. For more information please visit Glenborough’s website at www.glenborough.com 1


 
SHAREHOLDER NEWSLETTER                                        May 30, 2018 Retail Market Overview The retail market continues to be a mix of positive and This translated to decreased investor demand for retail negative headlines and indicators. property investment. Sales of retail properties fell in 2017 over 2016 by 15 to 20% according to various industry Leasing fundamentals looked very good for 2017. sources. Demand for publicly traded real estate According to CoStar, retail net absorption in 2017 was investment trusts (“REITs”) in the shopping center sector 85.9 million square feet as compared to deliveries of continues to wane as returns for the sector are off 16% 81.9 million square feet, lowering the vacancy rate to year to date according to data from KeyBanc. Many 4.5%. Average quoted rental rates trended up, ending shopping center REITs are expected to be net sellers this the year at $16.45 per square foot, an increase of 3.9% year and there may be a higher than normal amount of from $15.81 a year earlier. productforsale.Themarketsmostlikelytobeaffected will be secondary and tertiary markets as REITs would be While the supply and demand indicators may have expected to hold their core assets in the primary markets. been healthy, the overall retail real estate sector continued to face negative headlines. Given the store closing headlines investors appear to be adverse to releasing risk and this seems to have reduced investor demand for secondary markets and power centers and correspondingly pricing has weakened in some of those products. Topaz Marketplace Hesperia, CA Florissant Marketplace Florissant, MO According to Cushman and Wakefield, there were nearly 9,000 major chain store announced closures in 2017, more than double the number of chain stores closed in 2016. Shops At Turkey Creek Knoxville, TN West Coast markets are holding up better. For example, one REIT that owns only west coast retail shopping centers had, at its current stock price one, of the lowest implied cap rates and the lowest discounts to net asset value in the sector. That said, all retail is being painted with the same brush and many investors in both real property and securities are still cautious or negative on the sector. Real estate is a cyclical business with cycles and perceptions constantly changing. Ensenada Square Data from the U.S. Department of Commerce showed Arlington, TX total sales retail growth of 4.3% for the comparable 12- month period. Which, while a positive, becomes a negativetothemarketwhenonlineretailersgrewe- commerce sales by 15.5%. 2


 
SHAREHOLDER NEWSLETTER                                        May 30, 2018 Please Vote. Your Vote Is Needed. The 2018 Annual Meeting of Stockholders (the “Annual Meeting”) of Strategic Realty Trust, Inc. (the “Company”) is scheduled to  take place on Wednesday, June 20, 2018.   The Company is seeking your vote to elect three nominees to the board directors of the Company. The details related to the proposal are contained in the proxy statement, a copy of which is available on the internet through our  website at http://www.srtreit.com. The proxy statement and the proxy card were initially mailed to you on or around April 3,  2018.   If you have not already voted, the Company has made it easy for you to vote. 1. VOTE BY INTERNET—www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M., Eastern Time  on June 19, 2018, which is the day before the Annual Meeting date. Have your proxy card in hand when you access the website  and follow the instructions to obtain your records and to create an electronic voting instruction form. 2. VOTE BY PHONE—1‐800‐690‐6903 Use any touch‐tone telephone to transmit your voting instructions up until 11:59 P.M., Eastern Time on June 19, 2018, which is  the day before the Annual Meeting date. Have your proxy card in hand when you call and then follow the instructions. 3. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. Please take a moment to cast your votes as soon as possible. Thank you for your help with these important matters. The foregoing includes forward‐looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. The Company intends that such forward‐looking statements be subject to the safe harbors created by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements regarding the intent, belief or current expectations of the Company and members of its management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “hope”, “hopeful”, “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or similar expressions. Readers are cautioned not to place undue reliance on these forward‐looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update or revise forward‐looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law. Such statements are subject to known and unknown risks and uncertainties which could cause actual results todiffer materially from those contemplated by such forward‐looking statements. The Company makes no representation or warranty (express or implied) about the accuracy of any such forward‐looking statements. These statements are based on a number of assumptions involving the judgment of management. The Company can provide no assurances as to its ability to acquire properties that are consistent with its strategic plan, sell properties in its current portfolio, enter into new leases or modify existing leases, successfully manage the existing properties in its portfolio, successfully develop its redevelopment projects and execute potential strategic alternatives. These statements also depend on factors such as future economic, competitive and market conditions and other risks identified in Part I, Item IA of the Company’s Annual Report on Form 10‐K for the year ended December 31, 2017 and subsequent periodic reports, as filed with the SEC. Actual events may differ materially from the anticipated events discussed above. 3


 
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