Trinity Place Holdings Inc (TPHS)

[Enterprising Investor]

Trinity Place raising up to $30M to develop former assets of Filene's Basement (9/17/15)

by Jenna Loceff

MFP Investors LLC and Third Avenue Management LLC will invest up to $25 million to backstop a $30 million rights offering by Trinity Place Holdings Inc. as the successor to the defunct discount retailer Filene's Basement develops its real estate holdings and prepares to launch an online store.

Trinity, based in New York, was formed in the 2012 bankruptcy reorganization of Filene's Basement and its parent company company Syms Corp. with their real estate and other legacy assets. That includes a vacant, six-story commercial building in Lower Manhattan known as Trinity Place; a mostly-vacant retail property in Paramus, N.J.; a vacant retail property in Westbury, N.Y.; and a shopping center in West Palm Beach, Fla.

Trinity said in a Tuesday, Sept. 15, filing with the Securities and Exchange Commission that it plans to raise up to $30 million in its rights offering, which will allow current shareholders to buy new shares for $6 each. That was a 1.6% discount to the price where Trinity shares closed the previous day.

The stock fell 50 cents to $5.60 in over-the-counter trading on Tuesday, Sept. 16, after the financing was announced.

MFP and Third Avenue will invest a minimum of $15 million and a maximum of $25 million depending on how much is raised in the rights offering. Their investment will also be priced at $6 a share.

MFP, which is controlled by billionaire, value investor Michael Price, will buy a minimum of 1.67 million, or $10 million in stock, and a maximum of 3.33 million shares, or $20 million.

Third Avenue will buy 836,841 shares, or $5.02 million in stock.

Trinity announced last month that Wal-Mart Stores Inc. (WMT) signed a lease to put a Wal-Mart Neighborhood Store grocery store at Trinity's Shoppes at Forest Hill in West Palm Beach. The store will be the shopping center's anchor tenant.

In addition to the work Trinity is doing to develop its real estate, it also plans to capitalize on Filene's former intellectual property, CEO Matthew Messinger said.

"Because of the company's heritage and intellectual property, we will be launching Filene's.com," he said in an interview. "We have no desire to build a brick and mortar space, but if someone was interested in partnering we would have the conversation."

The website will launch next month.

"We have done a ton of research over the past with fans of the company," Messinger said.

Trinity will do more rights offerings in the future to finance its pursuit of other opportunities, Messinger said. "We will do relatively small rights offerings from time to time."

The law firm of Kramer Levin Naftalis & Frankel LLP is advising Trinity on its financing.

Representatives of MFP declined to comment. Third Avenue representatives didn't return calls seeking comment.

http://www.thedeal.com/content/real-estate/trinity-place-raising-up-to-30m-to-develop-former-assets-of-filenes-basement.php