Griffin Capital Essential Asset REIT CEO: PNLRs Evolving Ahead of FINRA Rules
04/24/2015 | by Sarah Borchersen-Keto

Kevin Shields, chairman and CEO of Griffin Capital Essential Asset REIT, joined REIT.com for a CEO Spotlight video interview during REITWise 2015: NAREIT’s Law, Accounting and Finance Conference held in Phoenix.

Griffin Capital Essential Asset REIT is a public non-listed REIT (PNLR) that owns a diversified portfolio of office and industrial properties net leased on a long term basis to creditworthy corporate tenants. Shields discussed changes in the PNLR landscape ahead of the implementation of new customer account rules from the Financial Industry Regulatory Association (FINRA). The rules, due to go into effect in  2016, are intended to increase transparency for investors by disclosing fees and commissions paid to brokers.

“It’s evolving relatively quickly. Financial advisors are anticipating what will happen when the account statement shows up,” Shields said.

Shields also commented on Griffin Capital’s investment offerings. He noted that despite cap rate compression for long-term single-tenant net lease office and industrial properties, “we still see a lot of really great opportunities” for Griffin Capital Essential Asset REIT II.

The company has also just closed new investment in Griffin-American Healthcare REIT III, raising $1.9 billion in the process.

“We are deploying that capital right now. We’ve got a fairly robust pipeline ,” Shields said.

Meanwhile, Griffin Capital  recently  launched a non-traded business development corporation with Benefit Street Partners LLC, the credit investment arm of Providence Equity Partners LLC. “There are a lot of interesting opportunities in middle-market lending,” Shields observed.

Turning to the Department of Labor’s proposed rule to impose a fiduciary duty on all retirement savings advisers, Shields remarked that “for better or for worse, it will come into effect .”

The proposed rule could prohibit or greatly curtail advisers’ ability to recommend PNLRs in retirement accounts.

Shields commented that the rule “may box a lot of the smaller investors out of the financial services arena and those are probably the investors who need it the most.”