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<div><a name="sB23F9C51FFB15715BD384DC4F2A08E4B"></a></div><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="1"></td></tr><tr><td style="width:100%;"></td></tr><tr><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:2px solid #000000;"><div style="overflow:hidden;height:5px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr></table></div></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;font-weight:bold;">UNITED STATES</font></div><div style="line-height:120%;text-align:center;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;font-weight:bold;">&#32;SECURITIES AND EXCHANGE COMMISSION</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">WASHINGTON, D.C. 20549</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">FORM 8-K</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">CURRENT REPORT</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;Pursuant to Section&#160;13 or 15(d) of the</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;Securities Exchange Act of 1934</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Date of report (Date of earliest event reported): </font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">April&#160;17, 2020</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:18pt;"><font style="font-family:inherit;font-size:18pt;font-weight:bold;">Steadfast Apartment REIT, Inc.</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(Exact Name of Registrant as Specified in Charter)</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="5"></td></tr><tr><td style="width:30%;"></td><td style="width:5%;"></td><td style="width:30%;"></td><td style="width:5%;"></td><td style="width:30%;"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Maryland</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">000-55428</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">36-4769184</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(State or Other Jurisdiction</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(Commission File Number)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(IRS Employer</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">of Incorporation)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Identification No.)</font></div></td></tr></table></div></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">18100 Von Karman Avenue</font><font style="font-family:inherit;font-size:10pt;">,</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;Suite&#160;500</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;Irvine, California 92612</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#32;(Address of Principal Executive Offices, including Zip Code)</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Registrant&#8217;s telephone number, including area code: (949)&#160;852-0700</font></div><div style="line-height:120%;padding-top:17px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Not applicable</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#32;(Former Name or Former Address, if Changed Since Last Report)</font></div><div 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:Wingdings;font-size:10pt;">o</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Written communications pursuant to Rule&#160;425 under the Securities Act (17 CFR 230.425)</font></div></td></tr><tr><td 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:Wingdings;font-size:10pt;">o</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Soliciting material pursuant to Rule&#160;14a-12 under the Exchange Act (17 CFR 240.14a-12)</font></div></td></tr><tr><td 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-left:1px solid #000000;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Title of each class</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-left:1px solid #000000;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Trading Symbol(s)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-left:1px solid #000000;border-right:1px solid #000000;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Name of each exchange on which 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name="sD457E2DAB1135641806FDA93592E8330"></a></div><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">ITEM&#160;7.01 REGULATION FD DISCLOSURE</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On </font><font style="font-family:inherit;font-size:10pt;">April&#160;20, 2020</font><font style="font-family:inherit;font-size:10pt;">, Steadfast Apartment REIT, Inc. (the &#8220;Company&#8221;) issued a press release announcing the estimated value per share of its common stock. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 7.01.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The information furnished under Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be &#8220;filed&#8221; for the 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 filings under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.</font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><div><a name="sFFE88C6E20D556B392C2EEB6E4BBF889"></a></div><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">ITEM 8.01 OTHER EVENTS</font><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">&#32;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Estimated Value Per Share</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:17px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">On March 6, 2020, each of Steadfast Income REIT, Inc. (&#8220;SIR&#8221;) and Steadfast Apartment REIT III, Inc. (&#8220;STAR III&#8221;) merged with and into a wholly owned subsidiary of the Company in stock-for-stock transactions (collectively, the &#8220;Mergers&#8221;).   At March 6, 2020, the combined Company&#8217;s portfolio </font><font style="font-family:inherit;font-size:10pt;">consisted of (1) 70 properties (including one property held for development) and (2) a 10% interest in one unconsolidated joint venture that owned 20 multifamily properties with a total of 4,584 apartment homes.</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;As discussed in greater detail below, the Company&#8217;s board of directors (the &#8220;Board&#8221;) initiated a process in November 2019 to determine an estimated value per share of its common stock for the combined company at the time of the Mergers. The Valuation and Advisory Services group of CBRE, Inc. (&#8220;CBRE&#8221;), a third-party independent valuation firm, performed appraisals on each of the Company&#8217;s, SIR&#8217;s and STAR III&#8217;s wholly-owned operating properties as of December 31, 2019 (the &#8220;Appraisals&#8221;). The Appraisals were used in determining the Company&#8217;s estimated value per share as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, the closing date of the Mergers. </font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">The Company is</font><font style="font-family:inherit;font-size:10pt;">&#32;providing this estimated value per share to assist broker-dealers that participated in the Company&#8217;s public offerings in meeting their customer account statement reporting obligations pursuant to Financial Industry Regulatory Authority, Inc. (&#8220;FINRA&#8221;) Rule 2231. This valuation was performed in accordance with Practice Guideline 2013-01, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Valuations of Publicly Registered Non-Listed REITs</font><font style="font-family:inherit;font-size:10pt;">, issued by the Institute for Portfolio Alternatives (formerly known as the Investment Program Association), in April 2013 (the &#8220;IPA Valuation Guidelines&#8221;). The Board formed a valuation committee (the &#8220;Valuation Committee&#8221;), comprised solely of independent directors, to oversee the process of determining its estimated value per share as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">. </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">Upon approval of the Board, the Company engaged CBRE Capital Advisors, Inc. (&#8220;</font><font style="font-family:inherit;font-size:10pt;">CBRE Cap&#8221;)</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, a FINRA registered broker dealer firm that specializes in providing real estate financial services, to provide property-level and aggregate valuation analyses and a range for the estimated value per share of the Company&#8217;s common stock as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">From CBRE Cap&#8217;s engagement through the issuance of its valuation report on </font><font style="font-family:inherit;font-size:10pt;">April&#160;17, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;(the &#8220;Valuation Report&#8221;), CBRE Cap held discussions with Steadfast Apartment Advisor, LLC (the &#8220;Advisor&#8221;) and the Company&#8217;s senior management and conducted or commissioned such investigations, research, review and analyses as it deemed necessary. CBRE Cap based its calculation of the range for the estimated value per share of the Company&#8217;s common stock on the Appraisals performed by CBRE&#8217;s Valuation and Advisory Services group, which is an affiliate of CBRE Cap and an independent third-party appraisal firm, and valuations performed by the Advisor with respect to the Company&#8217;s other assets and liabilities as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">. The Valuation Committee, upon its receipt and review of the Valuation Report, concluded that the range between </font><font style="font-family:inherit;font-size:10pt;">$14.40</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;and </font><font style="font-family:inherit;font-size:10pt;">$16.12</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;for the Company&#8217;s estimated value per share, as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, proposed in the Valuation Report was reasonable and recommended that the Board adopt </font><font style="font-family:inherit;font-size:10pt;">$15.23</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;as the estimated value per share of the Company&#8217;s common stock as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">. The estimated value per share represents the weighted average of the range reflecting the effect of using differing discount rates and terminal value capitalization rates in the sensitivity analysis.</font><font style="font-family:inherit;font-size:10pt;">&#32;</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">On </font><font style="font-family:inherit;font-size:10pt;">April&#160;17, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, the Board accepted the Valuation Committee&#8217;s recommendation and approved </font><font style="font-family:inherit;font-size:10pt;">$15.23</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;as the estimated value per share of the Company&#8217;s common stock as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">. 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font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">reviewed and discussed with the Company and the Advisor the historical and anticipated future financial performance of the Company&#8217;s multifamily properties, including forecasts prepared by the Company and the Advisor;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">reviewed appraisals commissioned by the Company that contained analysis on each of the Company&#8217;s multifamily properties and performed analyses and studies for each property;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">conducted or reviewed CBRE Cap proprietary research, including market and sector capitalization rate surveys;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">reviewed third-party research, including equity reports and online data providers;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; 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The Appraisals were prepared by CBRE&#8217;s Valuation and Advisory Services group and personnel who are members and hold the MAI designation. CBRE Cap reviewed and took into consideration the Appraisals, and described the results of the Appraisals in its Valuation Report. Discrete values were assigned to each property in the Company&#8217;s portfolio. </font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">The Valuation Committee and the Board considered the following valuation methodology with respect to each multifamily property, which was applied by CBRE Cap in its Valuation Report. Unlevered, ten-year discounted cash flow analyses (deducting lease-up discounts and deferred maintenance, where applicable) from the Appraisals were created for the combined Company&#8217;s fully operational properties. The &#8220;terminal capitalization rate&#8221; method was used to calculate the terminal value of the assets, with such rates varying based on the specific geographic location and other relevant factors. For properties acquired after December 31, 2019, the values were determined by their acquisition prices. One property under development was included in the valuation at cost as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">. The Company&#8217;s outstanding debt balances were included as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">, including debt originated after December 31, 2019. 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="7" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Increase (Decrease) on the Estimated Value per Share due to</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Decrease of 2.5%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Increase of 2.5%</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Terminal capitalization rate</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">0.47</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div 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style="font-family:inherit;font-size:10pt;">0.41</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(0.40</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td></tr></table></div></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">In its Valuation Report, CBRE Cap included an estimate of the </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;value of the Company&#8217;s assets, including cash and selected other assets net of payables, and accruals and other liabilities, including notes payable. The estimated values of the Company&#8217;s notes payable are equal to the United States Generally Accepted Accounting Principles (&#8220;GAAP&#8221;) fair values as of December 31, 2019, adjusted for the principal balance of new debt originated and debt paydowns during the period from January 1, 2020 to </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">. The GAAP fair values of the Company&#8217;s notes payable were determined using a discounted cash flow analysis. The discounted cash flow analysis was based on projected cash flow over the remaining loan terms and on management&#8217;s estimates of market interest rates as of December 31, 2019, for instruments with similar characteristics. The carrying values of a majority of the Company&#8217;s other assets and liabilities are considered to equal their fair value due to their short-term maturities or liquid nature. 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">December&#160;31, 2018</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">March&#160;6, <br>2020</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">December&#160;31, 2018</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Real estate properties</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3,445,935,000</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1,827,610,000</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">31.64</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">35.33</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Cash</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">277,776,798</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">72,738,775</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2.55</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.41</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Investment in unconsolidated joint venture</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">21,500,000</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#8212;</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">0.20</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#8212;</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Other assets</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">22,521,376</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4,760,131</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">0.21</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">0.09</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Mortgage debt</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(2,025,630,964</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(1,042,358,884</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(18.60</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(20.15</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Other liabilities</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(83,207,178</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(37,994,945</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(0.77</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(0.74</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Incentive fee</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#8212;</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(5,218,160</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#8212;</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(0.10</font></div></td><td style="vertical-align:bottom;background-color:#cceeff;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">)</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:18px;text-indent:-18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Estimated value per share</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1,658,895,032</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">819,536,917</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">15.23</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">15.84</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr></table></div></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The estimated value of the real estate properties as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">&#32;and </font><font style="font-family:inherit;font-size:10pt;">December&#160;31, 2018</font><font style="font-family:inherit;font-size:10pt;">&#32;was $</font><font style="font-family:inherit;font-size:10pt;">3,445,935,000</font><font style="font-family:inherit;font-size:10pt;">&#32;and </font><font style="font-family:inherit;font-size:10pt;">$1,827,610,000</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, respectively, while the total cost of the real estate properties was </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">$3,223,401,518</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;and </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">$1,612,494,662</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, respectively, comprised of the aggregate purchase price and capital expenditures subsequent to acquisition.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;font-style:italic;">Additional Information Regarding the Valuation, Limitations of Estimated Value per Share and the Engagement of CBRE Cap</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">In accordance with </font><font style="font-family:inherit;font-size:10pt;">the IPA Valuation Guidelines</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, the Valuation Committee reviewed, confirmed and approved the processes and methodologies employed by CBRE Cap, their consistency with real estate industry standards and best practices and the reasonableness of the assumptions utilized in the valuation.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">The Valuation Report issued on </font><font style="font-family:inherit;font-size:10pt;">April&#160;17, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, was based upon market, economic, financial and other information, circumstances and conditions existing prior to </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">, and any material change in such information, circumstances and/or conditions, including the outbreak of the Novel Coronavirus (COVID-19) and related economic effects, may have a material effect on the estimated value per share. CBRE Cap&#8217;s valuation materials were addressed solely to the Board to advise it in establishing an estimated value of the Company&#8217;s common stock. CBRE Cap&#8217;s valuation materials were restricted to the Board, were not addressed to the public and should not be relied upon by any other person to establish an estimated value of the Company&#8217;s common stock. The Valuation Report does not constitute a recommendation by CBRE Cap to purchase or sell any shares of the Company&#8217;s common stock and should not be represented as such.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">Each of CBRE Cap and CBRE reviewed the information supplied or otherwise made available to it by the Company or the Advisor for reasonableness, and assumed and relied upon the accuracy and completeness of all such information and of all information supplied or otherwise made available to it by any other party, and did not undertake any duty or responsibility to verify independently any of such information. With respect to operating or financial forecasts and other information and data provided to or otherwise reviewed by or discussed with CBRE Cap and CBRE, CBRE Cap and CBRE assumed that such forecasts and other information and data were reasonably prepared in good faith reflecting the Company&#8217;s and the Advisor&#8217;s best currently available estimates and judgments and other subjective judgments, and relied upon the Company and the Advisor to advise CBRE Cap and CBRE promptly if any information previously provided became inaccurate or was required to be updated during the period of its review. CBRE Cap assumes no obligation to update or otherwise revise these materials. In preparing its valuation materials, CBRE Cap did not, and was not requested to, solicit third party indications of interest for the Company in connection with possible purchases of the Company&#8217;s securities or the acquisition of all or any part of the Company.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">In performing its analyses, CBRE Cap made numerous assumptions as of various points in time with respect to industry performance, general business, economic and regulatory conditions, current and future rental market for the Company&#8217;s </font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">operating properties and those in development and other matters, many of which are necessarily subject to change and beyond the control of CBRE Cap and the Company. The analyses performed by CBRE Cap are not necessarily indicative of actual values, trading values or actual future results of the Company&#8217;s common stock that might be achieved, all of which may be significantly more or less favorable than suggested by the Valuation Report. The analyses do not purport to be appraisals or to reflect the prices at which the properties may actually be sold, and such estimates are inherently subject to uncertainty. The actual value of the Company&#8217;s common stock may vary significantly depending on numerous factors that generally impact the price of securities, the Company&#8217;s financial condition and the state of the real estate industry more generally. Accordingly, with respect to the estimated value per share of the Company&#8217;s common stock, neither the Company nor CBRE Cap can give any assurance that:</font></div><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">a stockholder would be able to resell shares at this estimated value;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">a stockholder would ultimately realize distributions per share equal to the Company&#8217;s estimated value per share upon liquidation of the Company&#8217;s assets and settlement of the Company&#8217;s liabilities or a sale of the Company;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">another independent third party appraiser or third party valuation firm would agree with the Company&#8217;s estimated value per share;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">a third-party would offer the estimated value per share in an arm</font><font style="font-family:inherit;font-size:10pt;">&#8217;</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">s length transaction to purchase all or substantially all of the Company&#8217;s shares of common stock;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">the Company&#8217;s shares would trade at a price equal to or greater than the estimated value per share if the Company listed them on a national securities exchange; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">the methodology used to estimate the Company&#8217;s value per share would be acceptable to FINRA or under the Employee Retirement Income Security Act of 1974 for compliance with its reporting requirements.</font></div></td></tr></table><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">The </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;estimated value per share was reviewed and recommended by the Valuation Committee and approved by the Board at meetings held on </font><font style="font-family:inherit;font-size:10pt;">April&#160;17, 2020</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">. The value of the Company&#8217;s common stock will fluctuate over time as a result of, among other things, developments related to individual assets and responses to the real estate and capital markets. The Company expects to utilize an independent valuation firm to update the estimated value per share as of December 31, 2020, in accordance with the IPA Valuation Guidelines.</font></div><div style="line-height:120%;padding-top:8px;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The estimated value per share does not reflect a discount for the fact that the Company is externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share does not take into account estimated disposition costs and fees for real estate properties that are not under contract to sell or debt prepayment penalties that could apply upon the prepayment of certain of the Company&#8217;s debt obligations or the impact of restrictions on the assumption of debt.</font></div><div style="line-height:120%;padding-top:8px;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The outbreak of the COVID-19, declared by the World Health Organization as a global pandemic on March 11, 2020, is causing heightened uncertainty in both local and global market conditions. The effect COVID-19 will have on the real estate markets generally, and in which the Company owns and operates assets, is currently unknown and will depend in part on both the scale and longevity of the pandemic. While market activity is being impacted in most sectors, at this stage hospitality and retail sectors have been most significantly impacted due to the increased response by local and global authorities, including shelter in place orders, restriction of travel and growing international concern. A prolonged pandemic could have a significant (and is yet unknown or quantifiable) impact on other sectors of the property market including multifamily real estate. Although the </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">, estimated value per share conclusions prepared by CBRE Cap and CBRE&#8217;s Valuation and Advisory Services group and subsequently determined by the Board are based on the information available at </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">, previous market information available on </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">, used for comparison purposes is now less reliable to inform opinions of value. The changing responses to COVID-19 create an unprecedented set of circumstances on which to base a judgment. Consequently, less certainty &#8211; and a higher degree of caution &#8211; should be attached to the estimated value per share as of </font><font style="font-family:inherit;font-size:10pt;">March&#160;6, 2020</font><font style="font-family:inherit;font-size:10pt;">, determination by the Board than would normally be the case.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">CBRE Cap is a FINRA registered broker-dealer and is an investment banking firm that specializes in providing real estate financial services. CBRE is actively engaged in the business of appraising commercial real estate properties similar to those owned by the Company in connection with public securities offerings, private placements, business combinations and similar transactions. The Company commissioned CBRE to deliver an appraisal report relating to the Company&#8217;s real estate properties and CBRE received fees upon delivery of such report. In addition, the Company agreed to indemnify CBRE Cap against certain liabilities arising out of this engagement. Each of CBRE Cap and CBRE is an affiliate of CBRE Group, Inc. (&#8220;CBRE Group&#8221;), a Fortune 500 and S&amp;P 500 company headquartered in Los Angeles, California, one of the world&#8217;s largest commercial real estate services and investment firms (in terms of 2019 revenue) and a parent holding company of affiliated companies that are engaged in the ordinary course of business in many areas related to commercial real estate and related services. CBRE Cap and its affiliates possess substantial experience in the valuation of assets similar to those owned by the Company and regularly undertake the valuation of securities in connection with public offerings, private placements, business combinations and similar </font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">5</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">transactions. For the preparation of the Valuation Report, the Company paid CBRE Cap a customary fee for services of this nature, no part of which was contingent relating to the provision of services or specific findings. The Company did not engage CBRE Cap for any other services. During the past five years, CBRE Cap advised the Board in the determination of the estimated value per share and certain of the Company&#8217;s affiliates engaged affiliates of CBRE primarily for various real estate-related services and these affiliates of CBRE received fees in connection with such services. The Company anticipates that affiliates of CBRE will continue to provide similar or other real estate-related services in the future for the Company. In addition, the Company may in its discretion engage CBRE Cap to advise the Board in future determinations of the Company&#8217;s estimated value per share. The Company is not affiliated with CBRE, CBRE Cap or any of their affiliates. CBRE Cap and CBRE and their affiliates may from time to time in the future perform other commercial real estate appraisal, valuation and financial advisory services for the Company in transactions related to the properties that are the subjects of the appraisals, so long as such other services do not adversely affect the independence of the applicable CBRE appraiser. While the Company and affiliates of the Advisor have engaged and may engage CBRE Cap or its affiliates in the future for commercial real estate services of various kinds, the Company believes that there are no material conflicts of interest with respect to the Company&#8217;s engagement of CBRE Cap.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">In the ordinary course of their business, each of CBRE Cap and CBRE, and their respective affiliates, directors and officers may structure and effect transactions for their own accounts or for the accounts of their customers in commercial real estate assets of the same kind and in the same markets as the Company&#8217;s assets.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;font-weight:bold;">Update to the Share Repurchase Program and Distribution Reinvestment Plan</font></div><div style="line-height:120%;padding-top:8px;text-align:left;text-indent:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">In connection with the determination of the estimated value per share, redemptions pursuant to the share repurchase plan will be based on a price of </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">$14.16</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">&#32;and, upon 10 days&#8217; notice to stockholders, distributions in shares pursuant to the distribution reinvestment plan will be reinvested at a price of </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">$15.23</font><font style="font-family:inherit;font-size:10pt;color:#231f20;">.</font></div><div style="line-height:120%;padding-top:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;font-weight:bold;">Determination Regarding Comrit Mini-Tender Offer</font></div><div style="line-height:120%;padding-top:8px;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">On April 17, 2020, the Board determined to recommend that the Company&#8217;s stockholders reject the unsolicited &#8220;mini-tender&#8221; offer by Comrit Investments 1, Limited Partnership (&#8220;Comrit&#8221;) for up to 443,951 shares of the Company&#8217;s common stock, which is approximately 0.41% of the outstanding shares. The Company wishes to inform its stockholders that it does not endorse Comrit&#8217;s unsolicited mini-tender offer and recommends that stockholders do not tender their shares. Stockholders who have already tendered their shares may withdraw them at any time prior to 11:59 p.m., Eastern Time, on May 30, 2020, unless extended by Comrit, in accordance with Comrit&#8217;s offering documents.</font></div><div style="line-height:120%;padding-top:8px;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#231f20;">The Company is circulating a letter to stockholders, furnished as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference, that sets forth the reasons the board of directors&#8217; recommended stockholders reject the tender offer.</font></div><div><a name="s936000A5FA41535499B79FF253B564A3"></a></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Forward-Looking Statements&#160;</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">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 &#8220;may,&#8221; &#8220;will,&#8221; &#8220;seeks,&#8221; &#8220;anticipates,&#8221; &#8220;believes,&#8221; &#8220;estimates,&#8221; &#8220;expects,&#8221; &#8220;plans,&#8221; &#8220;intends,&#8221; &#8220;should&#8221; or similar expressions. Further, forward-looking statements speak only as of the date they are made, and 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. Actual results may differ materially from those contemplated by such forward-looking statements. The appraisal methodology for the Company&#8217;s real estate properties assumes the properties realize the projected net operating income and that investors would be willing to invest in such properties at similar capitalization rates. Though the Appraisals of the real estate properties, with respect to CBRE, and the valuation estimates used in calculating the estimated value per share, with respect to the Advisor and the Company, are the respective party&#8217;s best estimates, the Company can give no assurance in this regard. Even small changes to these assumptions could result in significant differences in the appraised values of the Company&#8217;s real estate properties and the estimated value per share. The forward-looking statements also depend on factors such as: future economic, competitive and market conditions; the impact of COVID-19 on the Company&#8217;s residents, employees of the Advisor and results of operations; the Company&#8217;s ability to maintain occupancy levels and rental rates at its real estate properties; and other risks identified in Part I, Item IA of the Company&#8217;s Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the SEC. Actual events may cause the value and returns on the Company&#8217;s investments to be less than that used for purposes of the Company&#8217;s estimated value per share.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">6</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><div><a name="sF6FE9524F2EA53C9883C671E84200D24"></a></div><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;-sec-extract:summary;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">ITEM&#160;9.01 FINANCIAL STATEMENTS AND EXHIBITS</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(d)      Exhibits</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td style="width:11%;"></td><td style="width:89%;"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Exhibit</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Description</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.1</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><a style="text-decoration:underline;color:#0000FF;-sec-extract:exhibit;" href="ex991pressreleasepost-merg.htm"><font style="font-family:inherit;font-size:10pt;">Press Release, dated April 20, 2020</font></a></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.2</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><a style="text-decoration:underline;color:#0000FF;-sec-extract:exhibit;" href="ex992lettertostockholdersr.htm"><font style="font-family:inherit;font-size:10pt;">Letter to Stockholders of the Company from Rodney F. Emery, Chief Executive Officer and Chairman of the Board of Directors of the Company, dated as of April 20, 2020.</font></a></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.3</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><a style="text-decoration:underline;color:#0000FF;-sec-extract:exhibit;" href="ex993cbreconsent20200420.htm"><font style="font-family:inherit;font-size:10pt;">Consent of CBRE Capital Advisors, Inc.</font></a></div></td></tr></table></div></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">7</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><div><a name="sFA073669A11653BDB7EA04A5EC8C0FF5"></a></div><div><div style="line-height:120%;text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><div><br></div><div style="line-height:120%;padding-bottom:16px;text-align:center;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">SIGNATURES</font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">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.</font></div><div style="line-height:174%;padding-top:32px;text-align:left;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;width:92.1875%;border-collapse:collapse;text-align:left;"><tr><td colspan="4"></td></tr><tr><td style="width:8%;"></td><td style="width:45%;"></td><td style="width:7%;"></td><td style="width:40%;"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">STEADFAST APARTMENT REIT, INC.</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:20px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Date:</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">April&#160;20, 2020</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">By:</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">/s/ Kevin Keating</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Kevin Keating</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Chief Financial Officer and Treasurer</font></div></td></tr></table></div></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div><br></div><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">8</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div>	</div></body>
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Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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):
April 17, 2020
Steadfast Apartment REIT, Inc.
(Exact Name of Registrant as Specified in Charter)
Maryland
000-55428
36-4769184
(State or Other Jurisdiction
(Commission File Number)
(IRS Employer
of Incorporation)
Identification No.)
18100 Von Karman Avenue
,
Suite 500
Irvine, California 92612
(Address of Principal Executive Offices, including Zip Code)
Registrant's telephone number, including area code: (949) 852-0700
Not applicable
(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 (
see
General Instruction A.2.):
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act: None
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
N/A
N/A
N/A
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
x
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.
x
ITEM 7.01 REGULATION FD DISCLOSURE
On
April 20, 2020
, Steadfast Apartment REIT, Inc. (the "Company") issued a press release announcing the estimated value per share of its common stock. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 7.01.
The information furnished under Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be "filed" for the 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 filings under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
1
ITEM 8.01 OTHER EVENTS
Estimated Value Per Share
On March 6, 2020, each of Steadfast Income REIT, Inc. ("SIR") and Steadfast Apartment REIT III, Inc. ("STAR III") merged with and into a wholly owned subsidiary of the Company in stock-for-stock transactions (collectively, the "Mergers").   At March 6, 2020, the combined Company's portfolio
consisted of (1) 70 properties (including one property held for development) and (2) a 10% interest in one unconsolidated joint venture that owned 20 multifamily properties with a total of 4,584 apartment homes.
As discussed in greater detail below, the Company's board of directors (the "Board") initiated a process in November 2019 to determine an estimated value per share of its common stock for the combined company at the time of the Mergers. The Valuation and Advisory Services group of CBRE, Inc. ("CBRE"), a third-party independent valuation firm, performed appraisals on each of the Company's, SIR's and STAR III's wholly-owned operating properties as of December 31, 2019 (the "Appraisals"). The Appraisals were used in determining the Company's estimated value per share as of
March 6, 2020
, the closing date of the Mergers.
The Company is
providing this estimated value per share to assist broker-dealers that participated in the Company's public offerings in meeting their customer account statement reporting obligations pursuant to Financial Industry Regulatory Authority, Inc. ("FINRA") Rule 2231. This valuation was performed in accordance with Practice Guideline 2013-01,
Valuations of Publicly Registered Non-Listed REITs
, issued by the Institute for Portfolio Alternatives (formerly known as the Investment Program Association), in April 2013 (the "IPA Valuation Guidelines"). The Board formed a valuation committee (the "Valuation Committee"), comprised solely of independent directors, to oversee the process of determining its estimated value per share as of
March 6, 2020
.
Upon approval of the Board, the Company engaged CBRE Capital Advisors, Inc. ("
CBRE Cap")
, a FINRA registered broker dealer firm that specializes in providing real estate financial services, to provide property-level and aggregate valuation analyses and a range for the estimated value per share of the Company's common stock as of
March 6, 2020
.
From CBRE Cap's engagement through the issuance of its valuation report on
April 17, 2020
(the "Valuation Report"), CBRE Cap held discussions with Steadfast Apartment Advisor, LLC (the "Advisor") and the Company's senior management and conducted or commissioned such investigations, research, review and analyses as it deemed necessary. CBRE Cap based its calculation of the range for the estimated value per share of the Company's common stock on the Appraisals performed by CBRE's Valuation and Advisory Services group, which is an affiliate of CBRE Cap and an independent third-party appraisal firm, and valuations performed by the Advisor with respect to the Company's other assets and liabilities as of
March 6, 2020
. The Valuation Committee, upon its receipt and review of the Valuation Report, concluded that the range between
$14.40
and
$16.12
for the Company's estimated value per share, as of
March 6, 2020
, proposed in the Valuation Report was reasonable and recommended that the Board adopt
$15.23
as the estimated value per share of the Company's common stock as of
March 6, 2020
. The estimated value per share represents the weighted average of the range reflecting the effect of using differing discount rates and terminal value capitalization rates in the sensitivity analysis.
On
April 17, 2020
, the Board accepted the Valuation Committee's recommendation and approved
$15.23
as the estimated value per share of the Company's common stock as of
March 6, 2020
. CBRE Cap is not responsible for the determination of the estimated value per share of the Company's common stock as of
March 6, 2020
.
Valuation Methodology
In preparing the Valuation Report, CBRE Cap, among other things:
•
reviewed financial and operating information requested from or provided by the Advisor and the Company;
•
reviewed and discussed with the Company and the Advisor the historical and anticipated future financial performance of the Company's multifamily properties, including forecasts prepared by the Company and the Advisor;
•
reviewed appraisals commissioned by the Company that contained analysis on each of the Company's multifamily properties and performed analyses and studies for each property;
•
conducted or reviewed CBRE Cap proprietary research, including market and sector capitalization rate surveys;
•
reviewed third-party research, including equity reports and online data providers;
•
compared the Company's financial information to similar information of companies that CBRE Cap deemed to be comparable;
•
reviewed the Company's reports filed with the Securities and Exchange Commission ("SEC"), including the Company's Annual Report on Form 10-K for the period ended December 31, 2019, and the audited financial statements therein; and
•
reviewed the unaudited financial statements as of
March 6, 2020
, as prepared by the Company.
2
The Appraisals were performed in accordance with Uniform Standards of Professional Appraisal Practice and were all Member of Appraisal Institute ("MAI") appraisals. The Appraisals were prepared by CBRE's Valuation and Advisory Services group and personnel who are members and hold the MAI designation. CBRE Cap reviewed and took into consideration the Appraisals, and described the results of the Appraisals in its Valuation Report. Discrete values were assigned to each property in the Company's portfolio.
The Valuation Committee and the Board considered the following valuation methodology with respect to each multifamily property, which was applied by CBRE Cap in its Valuation Report. Unlevered, ten-year discounted cash flow analyses (deducting lease-up discounts and deferred maintenance, where applicable) from the Appraisals were created for the combined Company's fully operational properties. The "terminal capitalization rate" method was used to calculate the terminal value of the assets, with such rates varying based on the specific geographic location and other relevant factors. For properties acquired after December 31, 2019, the values were determined by their acquisition prices. One property under development was included in the valuation at cost as of
March 6, 2020
. The Company's outstanding debt balances were included as of
March 6, 2020
, including debt originated after December 31, 2019. Additionally, a fair market value adjustment for the debt portfolio in place as of December 31, 2019, was calculated and included.
Valuation Summary: Material Assumptions
The valuation process the Company used to determine an estimated value per share was designed to follow the recommendations of the IPA Valuation Guidelines.
The following table summarizes the key assumptions that were employed by CBRE Cap in the discounted cash flow models to estimate the value of the Company's real estate assets:
Range
Weighted-Average
Terminal capitalization rate
5.58% - 5.87%
5.73%
Discount rate
6.82% - 7.17%
7.00%
While the Company believes that CBRE Cap's assumptions and inputs are reasonable, a change in these assumptions and inputs may significantly impact the appraised value of the real estate properties and the Company's estimated value per share. The table below illustrates the impact on the estimated value per share if the terminal capitalization rates or discount rates were adjusted by 2.5% in either direction, which represents a 5% sensitivity analysis, in accordance with the IPA Valuation Guidelines, assuming all other factors remain unchanged:
Increase (Decrease) on the Estimated Value per Share due to
Decrease of 2.5%
Increase of 2.5%
Terminal capitalization rate
$
0.47
$
(0.45
)
Discount rate
0.41
(0.40
)
In its Valuation Report, CBRE Cap included an estimate of the
March 6, 2020
value of the Company's assets, including cash and selected other assets net of payables, and accruals and other liabilities, including notes payable. The estimated values of the Company's notes payable are equal to the United States Generally Accepted Accounting Principles ("GAAP") fair values as of December 31, 2019, adjusted for the principal balance of new debt originated and debt paydowns during the period from January 1, 2020 to
March 6, 2020
. The GAAP fair values of the Company's notes payable were determined using a discounted cash flow analysis. The discounted cash flow analysis was based on projected cash flow over the remaining loan terms and on management's estimates of market interest rates as of December 31, 2019, for instruments with similar characteristics. The carrying values of a majority of the Company's other assets and liabilities are considered to equal their fair value due to their short-term maturities or liquid nature. Certain balances, such as lease intangible assets and liabilities related to real estate investments and deferred financing costs, have been eliminated for the purpose of the valuation since the value of those balances was already considered in the Appraisals.
The Company's estimated value per share as of
March 6, 2020
, takes into consideration any potential liability related to the value of the Company's Class A convertible stock (the
"Convertible Stock") owned by
the Advisor. For purposes of determining the estimated value per share, the Advisor calculated the potential liability related to the Convertible Stock based on a hypothetical liquidation of the Company's assets and liabilities at their estimated fair values as of
March 6, 2020
, without considering the impact of any potential closing costs and fees related to the disposition of real estate properties, and determined that there would be
no
liability related to the Convertible Stock.
Taking into consideration the reasonableness of the valuation methodology, assumptions and conclusions contained in the Valuation Report, the Board determined the estimated value of the Company's equity interest in its real estate portfolio as of
3
March 6, 2020
, to be in the range of
$3,376,327,967
to
$3,563,844,457
and the Company's net asset value to range between
$1,567,787,998
and
$1,755,304,489
, or between
$14.40
and
$16.12
per share, based on a share count of
108,898,305
shares issued and outstanding as of
March 6, 2020
.
As with any valuation methodology, the methodologies considered by the Valuation Committee and the Board in reaching an estimate of the value of the Company's shares as of
March 6, 2020
, are based upon all of the foregoing estimates, assumptions, judgments and opinions that may, or may not, prove to be correct. The use of different estimates, assumptions, judgments or opinions may have resulted in significantly different estimates of the value of the Company's shares as of
March 6, 2020
.
The following table summarizes the material components of the Company's estimated value and estimated value per share as of
March 6, 2020
and
December 31, 2018
.
Estimated Value as of
Estimated Value Per Share as of
March 6,
2020
December 31, 2018
March 6,
2020
December 31, 2018
Real estate properties
$
3,445,935,000
$
1,827,610,000
$
31.64
$
35.33
Cash
277,776,798
72,738,775
2.55
1.41
Investment in unconsolidated joint venture
21,500,000
—
0.20
—
Other assets
22,521,376
4,760,131
0.21
0.09
Mortgage debt
(2,025,630,964
)
(1,042,358,884
)
(18.60
)
(20.15
)
Other liabilities
(83,207,178
)
(37,994,945
)
(0.77
)
(0.74
)
Incentive fee
—
(5,218,160
)
—
(0.10
)
Estimated value per share
$
1,658,895,032
$
819,536,917
$
15.23
$
15.84
The estimated value of the real estate properties as of
March 6, 2020
and
December 31, 2018
was $
3,445,935,000
and
$1,827,610,000
, respectively, while the total cost of the real estate properties was
$3,223,401,518
and
$1,612,494,662
, respectively, comprised of the aggregate purchase price and capital expenditures subsequent to acquisition.
Additional Information Regarding the Valuation, Limitations of Estimated Value per Share and the Engagement of CBRE Cap
In accordance with
the IPA Valuation Guidelines
, the Valuation Committee reviewed, confirmed and approved the processes and methodologies employed by CBRE Cap, their consistency with real estate industry standards and best practices and the reasonableness of the assumptions utilized in the valuation.
The Valuation Report issued on
April 17, 2020
, was based upon market, economic, financial and other information, circumstances and conditions existing prior to
March 6, 2020
, and any material change in such information, circumstances and/or conditions, including the outbreak of the Novel Coronavirus (COVID-19) and related economic effects, may have a material effect on the estimated value per share. CBRE Cap's valuation materials were addressed solely to the Board to advise it in establishing an estimated value of the Company's common stock. CBRE Cap's valuation materials were restricted to the Board, were not addressed to the public and should not be relied upon by any other person to establish an estimated value of the Company's common stock. The Valuation Report does not constitute a recommendation by CBRE Cap to purchase or sell any shares of the Company's common stock and should not be represented as such.
Each of CBRE Cap and CBRE reviewed the information supplied or otherwise made available to it by the Company or the Advisor for reasonableness, and assumed and relied upon the accuracy and completeness of all such information and of all information supplied or otherwise made available to it by any other party, and did not undertake any duty or responsibility to verify independently any of such information. With respect to operating or financial forecasts and other information and data provided to or otherwise reviewed by or discussed with CBRE Cap and CBRE, CBRE Cap and CBRE assumed that such forecasts and other information and data were reasonably prepared in good faith reflecting the Company's and the Advisor's best currently available estimates and judgments and other subjective judgments, and relied upon the Company and the Advisor to advise CBRE Cap and CBRE promptly if any information previously provided became inaccurate or was required to be updated during the period of its review. CBRE Cap assumes no obligation to update or otherwise revise these materials. In preparing its valuation materials, CBRE Cap did not, and was not requested to, solicit third party indications of interest for the Company in connection with possible purchases of the Company's securities or the acquisition of all or any part of the Company.
In performing its analyses, CBRE Cap made numerous assumptions as of various points in time with respect to industry performance, general business, economic and regulatory conditions, current and future rental market for the Company's
4
operating properties and those in development and other matters, many of which are necessarily subject to change and beyond the control of CBRE Cap and the Company. The analyses performed by CBRE Cap are not necessarily indicative of actual values, trading values or actual future results of the Company's common stock that might be achieved, all of which may be significantly more or less favorable than suggested by the Valuation Report. The analyses do not purport to be appraisals or to reflect the prices at which the properties may actually be sold, and such estimates are inherently subject to uncertainty. The actual value of the Company's common stock may vary significantly depending on numerous factors that generally impact the price of securities, the Company's financial condition and the state of the real estate industry more generally. Accordingly, with respect to the estimated value per share of the Company's common stock, neither the Company nor CBRE Cap can give any assurance that:
•
a stockholder would be able to resell shares at this estimated value;
•
a stockholder would ultimately realize distributions per share equal to the Company's estimated value per share upon liquidation of the Company's assets and settlement of the Company's liabilities or a sale of the Company;
•
another independent third party appraiser or third party valuation firm would agree with the Company's estimated value per share;
•
a third-party would offer the estimated value per share in an arm
'
s length transaction to purchase all or substantially all of the Company's shares of common stock;
•
the Company's shares would trade at a price equal to or greater than the estimated value per share if the Company listed them on a national securities exchange; or
•
the methodology used to estimate the Company's value per share would be acceptable to FINRA or under the Employee Retirement Income Security Act of 1974 for compliance with its reporting requirements.
The
March 6, 2020
estimated value per share was reviewed and recommended by the Valuation Committee and approved by the Board at meetings held on
April 17, 2020
. The value of the Company's common stock will fluctuate over time as a result of, among other things, developments related to individual assets and responses to the real estate and capital markets. The Company expects to utilize an independent valuation firm to update the estimated value per share as of December 31, 2020, in accordance with the IPA Valuation Guidelines.
The estimated value per share does not reflect a discount for the fact that the Company is externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share does not take into account estimated disposition costs and fees for real estate properties that are not under contract to sell or debt prepayment penalties that could apply upon the prepayment of certain of the Company's debt obligations or the impact of restrictions on the assumption of debt.
The outbreak of the COVID-19, declared by the World Health Organization as a global pandemic on March 11, 2020, is causing heightened uncertainty in both local and global market conditions. The effect COVID-19 will have on the real estate markets generally, and in which the Company owns and operates assets, is currently unknown and will depend in part on both the scale and longevity of the pandemic. While market activity is being impacted in most sectors, at this stage hospitality and retail sectors have been most significantly impacted due to the increased response by local and global authorities, including shelter in place orders, restriction of travel and growing international concern. A prolonged pandemic could have a significant (and is yet unknown or quantifiable) impact on other sectors of the property market including multifamily real estate. Although the
March 6, 2020
, estimated value per share conclusions prepared by CBRE Cap and CBRE's Valuation and Advisory Services group and subsequently determined by the Board are based on the information available at
March 6, 2020
, previous market information available on
March 6, 2020
, used for comparison purposes is now less reliable to inform opinions of value. The changing responses to COVID-19 create an unprecedented set of circumstances on which to base a judgment. Consequently, less certainty – and a higher degree of caution – should be attached to the estimated value per share as of
March 6, 2020
, determination by the Board than would normally be the case.
CBRE Cap is a FINRA registered broker-dealer and is an investment banking firm that specializes in providing real estate financial services. CBRE is actively engaged in the business of appraising commercial real estate properties similar to those owned by the Company in connection with public securities offerings, private placements, business combinations and similar transactions. The Company commissioned CBRE to deliver an appraisal report relating to the Company's real estate properties and CBRE received fees upon delivery of such report. In addition, the Company agreed to indemnify CBRE Cap against certain liabilities arising out of this engagement. Each of CBRE Cap and CBRE is an affiliate of CBRE Group, Inc. ("CBRE Group"), a Fortune 500 and S&P 500 company headquartered in Los Angeles, California, one of the world's largest commercial real estate services and investment firms (in terms of 2019 revenue) and a parent holding company of affiliated companies that are engaged in the ordinary course of business in many areas related to commercial real estate and related services. CBRE Cap and its affiliates possess substantial experience in the valuation of assets similar to those owned by the Company and regularly undertake the valuation of securities in connection with public offerings, private placements, business combinations and similar
5
transactions. For the preparation of the Valuation Report, the Company paid CBRE Cap a customary fee for services of this nature, no part of which was contingent relating to the provision of services or specific findings. The Company did not engage CBRE Cap for any other services. During the past five years, CBRE Cap advised the Board in the determination of the estimated value per share and certain of the Company's affiliates engaged affiliates of CBRE primarily for various real estate-related services and these affiliates of CBRE received fees in connection with such services. The Company anticipates that affiliates of CBRE will continue to provide similar or other real estate-related services in the future for the Company. In addition, the Company may in its discretion engage CBRE Cap to advise the Board in future determinations of the Company's estimated value per share. The Company is not affiliated with CBRE, CBRE Cap or any of their affiliates. CBRE Cap and CBRE and their affiliates may from time to time in the future perform other commercial real estate appraisal, valuation and financial advisory services for the Company in transactions related to the properties that are the subjects of the appraisals, so long as such other services do not adversely affect the independence of the applicable CBRE appraiser. While the Company and affiliates of the Advisor have engaged and may engage CBRE Cap or its affiliates in the future for commercial real estate services of various kinds, the Company believes that there are no material conflicts of interest with respect to the Company's engagement of CBRE Cap.
In the ordinary course of their business, each of CBRE Cap and CBRE, and their respective affiliates, directors and officers may structure and effect transactions for their own accounts or for the accounts of their customers in commercial real estate assets of the same kind and in the same markets as the Company's assets.
Update to the Share Repurchase Program and Distribution Reinvestment Plan
In connection with the determination of the estimated value per share, redemptions pursuant to the share repurchase plan will be based on a price of
$14.16
and, upon 10 days' notice to stockholders, distributions in shares pursuant to the distribution reinvestment plan will be reinvested at a price of
$15.23
.
Determination Regarding Comrit Mini-Tender Offer
On April 17, 2020, the Board determined to recommend that the Company's stockholders reject the unsolicited "mini-tender" offer by Comrit Investments 1, Limited Partnership ("Comrit") for up to 443,951 shares of the Company's common stock, which is approximately 0.41% of the outstanding shares. The Company wishes to inform its stockholders that it does not endorse Comrit's unsolicited mini-tender offer and recommends that stockholders do not tender their shares. Stockholders who have already tendered their shares may withdraw them at any time prior to 11:59 p.m., Eastern Time, on May 30, 2020, unless extended by Comrit, in accordance with Comrit's offering documents.
The Company is circulating a letter to stockholders, furnished as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference, that sets forth the reasons the board of directors' recommended stockholders reject the tender offer.
Forward-Looking Statements
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 "may," "will," "seeks," "anticipates," "believes," "estimates," "expects," "plans," "intends," "should" or similar expressions. Further, forward-looking statements speak only as of the date they are made, and 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. Actual results may differ materially from those contemplated by such forward-looking statements. The appraisal methodology for the Company's real estate properties assumes the properties realize the projected net operating income and that investors would be willing to invest in such properties at similar capitalization rates. Though the Appraisals of the real estate properties, with respect to CBRE, and the valuation estimates used in calculating the estimated value per share, with respect to the Advisor and the Company, are the respective party's best estimates, the Company can give no assurance in this regard. Even small changes to these assumptions could result in significant differences in the appraised values of the Company's real estate properties and the estimated value per share. The forward-looking statements also depend on factors such as: future economic, competitive and market conditions; the impact of COVID-19 on the Company's residents, employees of the Advisor and results of operations; the Company's ability to maintain occupancy levels and rental rates at its real estate properties; 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, 2019, as filed with the SEC. Actual events may cause the value and returns on the Company's investments to be less than that used for purposes of the Company's estimated value per share.
6
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d)      Exhibits
Exhibit
Description
99.1
Press Release, dated April 20, 2020
99.2
Letter to Stockholders of the Company from Rodney F. Emery, Chief Executive Officer and Chairman of the Board of Directors of the Company, dated as of April 20, 2020.
99.3
Consent of CBRE Capital Advisors, Inc.
7
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.
STEADFAST APARTMENT REIT, INC.
Date:
April 20, 2020
By:
/s/ Kevin Keating
Kevin Keating
Chief Financial Officer and Treasurer
8