- UC Asset LP (UCASU, Financial) plans a secondary public offering to raise up to $10 million with preferred shares offering an 8% dividend annually.
- Cannabis property acquisition targets projected to achieve 109% revenue growth in 2025.
- Projected annual operating profit from acquisition targets sufficient to cover the proposed 8% preferred dividend.
UC Asset LP (ticker: UCASU) has revealed its plans to conduct a secondary public offering (SPO) under Reg A, aiming to raise up to $10 million by issuing preferred shares that offer an 8% annual dividend. The capital raised will largely be allocated to acquiring cannabis properties, a move indicating a strategic expansion within the sector.
The acquisition targets comprise two groups of properties with a total of 25 units, covering 37,800 square feet. These properties have shown promising financial performance, generating $137,000 in net operating revenue in the first five months of 2025. This positions them to achieve an annualized operating profit of $330,000 by the end of 2025—marking a significant 109% growth over 2024.
This impressive growth projection comes in light of a prior decline, with current operating revenue at 60% of its peak in 2023 when it reached $547,000. UC Asset's non-binding Letter of Intent (LOI) to acquire these properties for $3 million underscores the company's confidence in the sector's recovery and growth potential.
Founder Larry Wu articulated that the market conditions for cannabis operators have hit a historical low, presenting a unique opportunity to invest in undervalued properties. The projected 11% yield on the acquisition price indicates that the expected operating profits are adequate to cover the proposed 8% dividend distribution, which is notably higher than the 4.9% average total return of REITs in 2024.
