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Apollo Realty Income Solutions Initiates $5B Follow-On Offering, Restructures Shares

By Mari Nicholson

Apollo Realty Income Solutions Initiates $5B Follow-On Offering, Restructures Shares

Apollo Realty Income Solutions Inc., a non-traded net asset value real estate investment trust sponsored by Apollo Global Management Inc., has launched a follow-on public offering, seeking to raise up to $5 billion through the sale of its common stock.

The U.S. Securities and Exchange Commission declared the registration statement on Form S-11 effective at the end of June, paving the way for the Apollo company’s additional capital raise and activities.

In conjunction with this new offering, Apollo Realty Income Solutions has undertaken a strategic restructuring of its share classes, simplifying its capital structure. The company has formally retired three classes of its common stock: Class F-S, Class F-D and Class A-II, each with a par value of $0.01 per share. With the move, the company said it aimed to streamline equity offerings and enhance clarity for investors.

The reclassification involved:

  • Reclassifying 50 million authorized but unissued Class F-S shares as Class I common stock, $0.01 par value per share;
  • Reclassifying another 50 million authorized but unissued Class F-S shares as Class A-III common stock, $0.01 par value per share;
  • Reclassifying 100 million authorized but unissued Class F-D shares as Class A-I common stock, $0.01 par value per share; and
  • Reclassifying 100 million authorized but unissued Class A-II shares as Class A-III shares.

As a result of these reclassifications and designations, the Apollo REIT issued a total of 1 billion shares of common stock, classified and designated as follows: 100 million Class S, 100 million Class D, 150 million Class I, 100 million Class F-1, 200 million Class A-I, 250 million Class A-III, and 100 million Class E shares.

To facilitate these changes and align with the new offering, Apollo Realty Income Solutions has amended key governance and operational agreements. The company alongside ARIS Operating Partnership L.P. and adviser ARIS Management LLC entered into a fourth amended and restated advisory agreement. This updated agreement specifically removes references to the now-retired share classes, reflecting the simplified structure.

Furthermore, the OP executed a third amended and restated limited partnership agreement. That agreement, involving the REIT as general partner, the OP itself, ARIS Special Limited Partner LLC, and other limited partners modifies the prior second amended and restated limited partnership agreement. The primary change is the removal of Class F-S, Class F-D and Class A-II units, which were the corresponding partnership units to the retired share classes.

The REIT also amended its share repurchase plan and distribution reinvestment plan to remove the retired share classes.

At the end of 2024, Jess Lipsey was appointed to the positions of chief executive officer and president of Apollo Realty Income Solutions. This was following the retirement of Dr. Randy Anderson. The REIT focuses on investing in stabilized, well-leased, income-oriented commercial real estate assets throughout the United States.

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