Commercial real estate finance company AFC Gamma, founded in July, has filed an S-11 to go public on the NASDAQ as a REIT. The company, which expects to trade under the symbol “AFCG”, has named JMP Securities, Ladenburg Thalmann and Seaport Global Securities as its underwriters. AFC Gamma raised $80 Million this past summer from more than 20 family offices, and the preliminary prospectus disclosed the recent sales of $12.3 million in equity and $125K in Series A Cumulative Non-Voting Preferred Stock. The company also has a $40 million line of credit.
New Cannabis Ventures recently interviewed founder Leonard Tannenbaum, who discussed the company’s investment approach. Tannenbaum ran Fifth Street Management previously. The prospectus didn’t detail the expected size or the potential pricing, but the company is expecting to raise up to $115 million.
If successful listing, AFC Gamma will become only the second pure-play cannabis REIT to go public on a major exchange, following Innovative Industrial Properties (NYSE: IIPR), which debuted at the end of 2016. More recently, Power REIT (NYSE: REIT) has begun to fund cannabis operators with sale-leaseback transactions.
According to the IPO preliminary prospectus, AFC Gamma has funded $92.5 million in loans and have commitments for an additional $19.8 million. The company has disclosed transactions with privately held Nature’s Medicines and publicly traded Curaleaf (CSE: CURA) (OTC: CURLF) and Bluma Wellness (CSE: BWEL) (OTC: BMWLF). No borrowers were named in the prospectus, but the company did describe loans and pending loans to 4 private and 3 public companies.
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