SecProbe.io

CORRESP
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filename1.htm

Michael
J. Choate

Direct:
(312) 836-4066

Facsimile:
(312) 527-5921

E-Facsimile:
(312) 275-7554

E-mail:  mchoate@shefskylaw.com

026829-00001

April 21, 2005

Ms. Elaine Wolff

Legal Branch Chief

Division of Corporation Finance

United States Securities and Exchange
Commission

Mail Stop 0409

450 Fifth Street, N.W.

Washington, D.C.  20549

Re:                             Inland
American Real Estate Trust, Inc.

Registration Statement on Form S-11 Filed February 11, 2005

Registration No. 333-122743

Dear Ms. Wolff:

We are writing on behalf of our client, Inland American Real Estate
Trust, Inc. (the “Company”), in response to the comments contained in the
Staff’s letter dated March 10, 2005.
The headings and paragraph numbers below correspond to the headings and
paragraph numbers in your letter.  In
addition, for your convenience we have reproduced your comments in this letter
and included our responses directly below each comment.

General

1.                                      We note that you are registering shares to be
offered under a dividend reinvestment plan to investors in the offering.  Please tell us supplementally whether persons
who become shareholders other than by participating in the offering may
purchase shares through the dividend reinvestment plan, and, if so, whether you
intend to distribute to those persons a separate prospectus relating solely to the
dividend reinvestment plan.  Please also
tell us supplementally whether you intend to keep updated and distribute the
prospectus included in this registration statement so long as offers and sales
are being made under the dividend reinvestment plan or if you intend to use a
separate prospectus relating solely to the dividend reinvestment plan.  In either case, if you do intend to
distribute a separate prospectus relating to the dividend reinvestment plan, please
amend the registration statement to include that prospectus, which should
include a reasonably detailed description of the plan in addition to all disclosure
required by Form S-11.  Typically, a
prospectus for a dividend reinvestment plan is presented in question-and-answer
format.

RESPONSE:

The Company’s Distribution Reinvestment Plan, or DRP, is set forth in Appendix
B and Exhibit 4.1 to the Form S-11, both of which are identical in
content.  Appendix B and Exhibit 4.1
provide a detailed description of the terms and conditions of the DRP in the
typical question-and-answer format.  As described
in Question 5 to the DRP, any stockholder with shares registered directly in
his or her name is eligible to enroll in the DRP; participation in the offering
is not a prerequisite.  However, as
Question 6 to the DRP explains, eligible stockholders may not join the DRP
until they have been furnished with a copy of the prospectus describing the DRP.  By signing the DRP enrollment form, included
as Appendix C-2 to the Form S-11, stockholders certify that they have
received and read the prospectus and agree to abide by the terms and conditions
of the DRP.

Prior to the termination of the offering, the Company does not expect
to distribute a separate prospectus relating solely to the DRP.  Instead, the Company will distribute copies
of the prospectus included in the Form S-11, updated from time-to-time in
accordance with the requirements of the Securities Act.  Following the termination of the offering,
the Company intends to separately register the DRP on a registration statement
on Form S-3 or other appropriate form.
Prospective enrollees will then receive a copy of the prospectus
included in that registration statement, once it is declared effective, prior
to enrolling in the DRP.

2.                                      We note from Exhibit 4.2 that you may conduct
the share repurchase program during the offering period of the shares being
registered under this registration statement.  Please tell us supplementally how the
repurchases of shares will be conducted in a manner that is consistent with the
restrictions on activities by issuers during distributions of securities set
forth in Regulation M.  See CNL American
Properties Fund, Inc. (Letter dated August 13, 1998) and T REIT Inc.
(Letter dated June 4, 2001).

RESPONSE:

Attached as Exhibit 1 to this letter is a copy of the
Company’s letter to the Divisions of Market Regulation and Corporation Finance,
dated the date hereof, requesting an exemption from the prohibitions of Rule 102(a) of
Regulation M with respect to repurchases by the Company under its share
repurchase program.  The discussion regarding
Regulation M contained in the no-action letter is incorporated by reference in
response to the Staff’s request for supplemental information.

3.                                      Please supplementally provide us with your
analysis regarding the applicability of the tender offer rules to the
share repurchase program.  Refer to Rule 13c-4
and Regulation 14E of the Exchange Act.

RESPONSE:

An analysis regarding the applicability of the tender offer rules vis-à-vis
repurchases under the share repurchase program is included in the Company’s
no-action letter attached to this

letter as Exhibit 1.  The analysis regarding the tender offer rules contained
in the no-action letter is incorporated by reference in response to the Staff’s
request for supplemental information.

4.                                      Supplementally, please provide us with any
pictures, graphics or artwork that will be used in the prospectus.

RESPONSE:

To date, the Company has not prepared any pictures, graphics or artwork
for use in the prospectus.  However, if
any of these materials are prepared in the future, the Company will provide copies
to the Staff prior to use.

5.                                      Please note that any sales literature that is to
be used in connection with this offering must be submitted to us supplementally
prior to use, including sales literature intended for broker-dealer use only.  Please submit all written sales materials
proposed to be transmitted to prospective investors, orally or in writing, with
your next filing.  In this regard, note
that sales materials must set forth a balanced presentation of the risks and
rewards to investors and should not contain any information or disclosure that
is inconsistent with or not also provided in the prospectus.  For guidance, refer to Item 19.D of Industry
Guide 5.

RESPONSE:

To date, the Company has not prepared sales literature or sales
materials of any kind for use in connection with the offering.  However, if any sales literature or sales
materials are prepared in the future, the Company will provide copies to the
Staff prior to use.

6.                                      We note that you may invest in other real estate
assets and entities owning these assets, such as mortgage loans secured by
commercial real estate.  Provide the information
required by Item 13(b) of Form S-11.

RESPONSE:

We have revised the disclosure throughout the Form S-11 to make
clear that the Company’s other investments in real estate assets may include
investments in collateralized mortgage-backed securities.  In addition, the disclosure has been revised
to clarify that the Company may make loans to affiliates of, or entities
sponsored by, IREIC.  These loans may be
secured by first or second mortgages on commercial real estate or a pledge of
ownership interests in the entity owning commercial real estate.  The aggregate amount of all loans made to any
of these affiliates or entities may not exceed eighty-five percent (85.0%) of
the appraised value of the property or the entity securing the loan.  Aside from these requirements, the Company
does not have, and does not expect to adopt, any policies regarding the amount
or percentage of assets that will be used to make loans to affiliates of, or
entities sponsored by, IREIC.

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Cover Page

7.                                      It should be clear in the risk factor
cross-reference paragraph that you are identifying the material risks.

RESPONSE:

We have revised the risk factor cross-reference paragraph on the cover page to
clarify that we are identifying material risks of an investment in the Company’s
common stock.

8.                                      State also the minimum purchase requirements for
tax-exempt entities as discussed on page ”iii.”

RESPONSE:

We have included the minimum purchase requirements for tax-exempt
entities at the end of the third paragraph on the cover page.

9.                                      We note your statement that the description of
your company in the prospectus is accurate as of February 11, 2005 and
that all material changes in your affairs will be disclosed by amendment or
supplement.  The prospectus must be
current as of the date of effectiveness and must include all material
information about the company as of that date.  You may not exclude material information known
at the time of effectiveness from the prospectus with the intent of disclosing
it in a supplement.

RESPONSE:

The prospectus will be current as of the date of effectiveness and will
include all material information about the Company as of that date.

10.                               State on the cover page that the price of the securities has been
arbitrarily selected by you as disclosed on page ”i.”

RESPONSE:

We have added a sentence to the first paragraph on the cover page stating
that the offering price was arbitrarily determined by the Company’s board of
directors.

11.                               Please also revise the existing cover page risk factors as follows:

•                                          Include
a risk factor regarding the high amount of leverage authorized by your charter
of 300% of net assets and that such leverage may reduce the amount of
distributions to investors.

•                                          In
the fourth bullet point of column 1, briefly disclose your affiliation with
your business manager and property manager.

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•                                          In
the fifth bullet point of column 1, expand to briefly disclose that the reason
your business manager may have incentive to recommend risky or speculative
investments is that their fee is equal to a percentage of the purchase price of
real estate assets and a percentage of average invested assets.

•                                          In
the first bullet point of column 2, briefly disclose that you do not intend to
apply to have your shares listed on any national exchange or quoted on any
national market system in the near future.

•                                          Briefly
describe the conflicts of interest mentioned in the fourth bullet point of
column 2.

•                                          Briefly
describe the limits on ownership, transferability and redemption in the last
bullet point of column 2.

RESPONSE:

We have used our best efforts to revise the cover page risk
factors as requested without exceeding the one page limitation for the
cover page.  In addition, because of
changes made to respond other Staff comments, the cover page risk factors
have been revised and rearranged.

12.                               To the extent we highlight or request risk factor disclosure on the cover
page, please make conforming changes in the Summary Risk Factors or in the Risk
Factor section.

RESPONSE:

To the extent required, we have conformed the
disclosure.

13.                               Please revise the table at the bottom of the page to include the
marketing support fees.  In this regard,
we note also the discrepancy between the selling commission amount
of 7.5% of the sale price of each share on page 9 with that of just over
10% ($1.05 per share) of the sale price on the cover page.  If the amount in the table includes the
marketing support fees already, clarify that fact in a footnote or otherwise.

RESPONSE:

We have revised footnote (1) to the table to clarify that commissions
of $1.05 per share are composed of a 7.5% selling commission, a 2.5% marketing
contribution and a 0.5% due diligence expense allowance.

14.                               In that regard, you should include a footnote that discloses all other
expenses incurred in connection with the issuance and distribution of the
securities.

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RESPONSE:

We have added footnote (2) to the table, which explains that
organization and offering expenses, excluding commissions, may not exceed 4.5%
of the gross offering proceeds.
Organization and offering expenses include registration and filing fees,
legal and accounting fees, printing and mailing expenses, bank fees and other
administrative expenses.  Total
organization and offering expenses, including commissions, may not exceed 15.0%
of the gross offering proceeds.

Question and Answers About the Offering

15.                               Please be aware that we view the Question and Answer section and the
Summary section of the prospectus to be one section.  Your Q&A should not repeat any information
that appears in the summary, and vice versa.  To the extent there is repetitive text in
these sections, please revise to minimize the repetition.  We note, for example, that both sections
contain information regarding your intended operations, material terms of the
offering and a list of summary risk factors.  Further, the Q&A and the Summary sections
should provide investors with a concise and coherent “snapshot” description of
the most significant aspects of the offering.  In this connection, please revise to provide a
brief description of the compensation paid to your affiliates.  See Securities Act Release 33-6900 and Section 3
of Industry Guide 5.

RESPONSE:

We have revised the Question and Answer and the Summary sections of the
prospectus to minimize repetitive text.
In addition, we have revised the “Compensation To Be
Paid To Our Affiliates” section to include only the most
significant aspects of each compensation arrangement.

What is a REIT?

16.                               We refer to the second bullet point under this heading.  It is not clear how the company, by virtue of
being organized as a REIT, will have a “diversified portfolio.”  In other words, diversification does not
appear to be an inherent characteristic of a REIT.  Please revise to remove this portion of the
bullet point.

RESPONSE:

In revising the Question and Answer and Summary sections of the
prospectus pursuant to Comment 15, the “What is a REIT?” question was
deleted.  However, we have removed the
word “diversified” from the second bulleted item under the “Inland American Real
Estate Trust, Inc.” disclosure in the Summary section.

How does a “best efforts” offering work? – Page 1

17.                               We note that shares purchased by your officers, directors or affiliates
will not count toward satisfying the minimum offering.  Please clarify whether the managing dealer and

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soliciting dealers may purchase shares, and if so, the
maximum number of shares that may be purchased.

RESPONSE:

We have clarified that a “best efforts” offering means that the Company’s
dealer manager or any soliciting dealer may, but is not obligated to, purchase
any specific number or dollar amount of shares provided that the purchases
comply with NASD regulations.

How long will the offering last? – Page 2

18.                               Name the states where the offering may be extended and disclose how
investors will be informed of such extension.

RESPONSE:

All jurisdictions, except California, Florida, Maine, Ohio, Guam and
Puerto Rico, allow the Company to extend the offering for an additional year
either automatically or by paying a renewal fee.  We have added this disclosure to the “How
long will the offering last?” question.
In addition, we have noted that the Company will notify investors of any
extension via a supplement to the prospectus.

Are there any risks involved i