Procaccianti Hotel REIT Limits Share Repurchases

Deceased stockholders’ shares receive full repurchase priority, while remaining requests face a 2.4% proration.

May 27, 2025

Procaccianti Hotel REIT, Inc. Scales Back Share Repurchases Due to Funding Cap

Procaccianti Hotel REIT has reached a key limit on its share repurchase program for the first quarter of 2025. As of May 21, the company confirmed that it did not have enough capital from its distribution reinvestment plan (DRIP) to meet every repurchase request submitted for the period ending March 31. The result: repurchase requests are being scaled back and processed based on a strict order of priority.

What Triggered the Proration?

Here’s how it works. Under the company’s structured repurchase policy, there’s a cap: no more than 5% of outstanding Class K, K-1, and K-T shares —measured over the trailing 12 months—can be repurchased in a given year. And even within that cap, actual execution depends on funding availability, which primarily comes from DRIP inflows and, in some cases, other operating cash approved by the board.

For Q1, that funding ran short.

How Repurchase Requests Were Prioritized

The repurchase process follows a clear hierarchy:

• First: Shares of deceased stockholders, which were fully repurchased.


• Second (if applicable): Requests tied to qualifying disabilities, bankruptcies, or accounts with fewer than 100 shares. No such requests were submitted this quarter.


• Third: All remaining requests, which are being repurchased at approximately 2.4% of the amount submitted.

What This Means for Investors

For investors, this means fewer shares repurchased now, with the balance automatically carried over to the next quarter—unless the investor cancels the request ahead of the five-business-day cutoff before the next repurchase date.

The mechanics are straightforward, but the message is clear: repurchase activity depends on available funds, and when capital is constrained, priority matters. Investors in the program should be aware that limits apply not just annually, but quarter by quarter, and that program rules strictly determine the order in which requests are fulfilled.

As the next quarter approaches, shareholders with pending requests should track program thresholds and consider whether to leave requests in place or adjust their approach.