Rouse Co.'s plan to become REIT gives shares a boost Stock rises 10 percent in heavy trading

Commercial real estate

November 22, 1997|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

Rouse Co.'s common stock rose nearly 10 percent in heavy trading yesterday, in the wake of the Columbia-based company's announcement that it will convert to a real estate investment trust on Jan. 1.

Rouse's stock closed at $31 a share, up $2.81 a share on a volume of 1.25 million shares.

Earlier in the day, the real estate concern's stock climbed by 17 percent, hitting a high of $33 a share. On Thursday, prior to the announcement, Rouse's shares gained 6 cents, to close at $28.19 per share.

Rouse announced plans to convert from a "C" corporation to a REIT to gain Wall Street exposure, to avoid federal income taxes and perhaps to acquire other trusts. Under federal law, non-REIT entities aren't allowed to merge with or acquire REIT companies.

In becoming a REIT, Rouse also will likely broaden its investor base, as some mutual funds and Wall Street brokerage houses confine their real estate investing solely to REIT securities.

Rouse, which owns 250 commercial projects in 26 states and Canada, will have a total market capitalization upon converting of $5 billion.

Pub Date: 11/22/97

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