Procaccianti Hotel REIT Prorates Second-Quarter Buybacks to About 3% of Shares Requested

The binding constraint was not the program’s 5% volume ceiling but its funding limitation, which ties every dollar of exit liquidity to reinvestment plan inflows.

August 28, 2026

Procaccianti Hotel REIT will honor only about 3% of the non-priority share repurchase requests it received for the quarter ended June 30, 2026, after its board determined on August 26 that the program’s funding cap had again been reached.

Two constraints, one that bound

The Cranston, Rhode Island-based non-traded hospitality REIT operates its Amended and Restated Share Repurchase Program under two separate limits:

• A volume ceiling — no more than 5.0% of the weighted average number of Class K, Class K-I and Class K-T shares outstanding over the trailing 12 months, with shares tendered on a stockholder’s death counted toward the calculation but exempt from the cap itself.
• A funding limitation — repurchase capital confined to net proceeds from the distribution reinvestment plan, plus whatever additional operating funds the board elects to authorize.

It was the funding limitation that bound. Reinvestment plan proceeds were insufficient to cover the quarter’s requests, sending the program into its priority waterfall. Deceased stockholders’ shares will be repurchased in full. No requests arrived in the next two tiers — stockholders with qualifying disabilities or other involuntary exigent circumstances such as bankruptcy, and full redemptions of accounts holding 100 or fewer Class K or Class K-I shares — so the entire remaining book dropped to the pro rata tier and cleared at roughly 3% of shares requested.

Why the percentage is hard to read in isolation

Unfilled requests carry forward automatically to subsequent repurchase dates unless a stockholder withdraws five business days beforehand. Because each quarter’s pro rata pool absorbs demand rolled over from prior periods, a proration rate holding steady quarter to quarter does not indicate that underlying redemption demand has stabilized.

The figure is tighter than the roughly 3.6% the REIT prorated for the fourth quarter of 2025. Distributions, meanwhile, have continued to be authorized on a quarterly basis, leaving income flowing while the exit channel stays narrow.

The structural read for allocators

For advisors holding client positions in the vehicle, the point is the funding source rather than the percentage. A repurchase program financed out of reinvestment plan inflows can only be as large as the share of investors electing to reinvest, and in a small non-traded REIT with no listing and no secondary market, that pool sets the practical limit on quarterly liquidity regardless of where the 5% volume ceiling sits. Single-digit prorations indicate redemption demand running well beyond that capacity, with the shortfall queuing rather than clearing.

Chief Financial Officer Gregory Vickowski signed the disclosure on August 27, 2026.