Preferred Apartment Communities Confirms Blackstone Buyout Offer

By Chris Wack

Preferred Apartment Communities Inc. confirmed Wednesday that it is being bought by Blackstone Real Estate Income Trust Inc. for $25 a share in an all-cash transaction valued at $5.8 billion.

Earlier Wednesday, The Wall Street Journal reported that Blackstone Inc. was buying the rental apartment owner in a deal that demonstrates the strong investor demand for multifamily properties in Sunbelt states.

The deal includes 44 high-quality multifamily communities totaling 12,000 units, concentrated largely in Atlanta; Orlando, Tampa and Jacksonville, Fla.; Charlotte, N.C.; and Nashville, Tenn.

It also includes 54 grocery-anchored retail assets comprising six million square feet located mostly in Atlanta; Orlando; Nashville; and Raleigh, N.C. BREIT would also acquire two Sun Belt office properties and 10 mezzanine/preferred equity investments collateralized by under construction and newly-built multifamily assets.

The purchase price represents a premium of 39% over its Feb. 9 closing price.

The holders of each series of Preferred Apartment Communities' preferred stock would receive the $1,000 per share liquidation preference for each share plus accrued but unpaid dividends. Upon completion of the transaction, Preferred Apartment Communities' common stock would no longer be listed on the New York Stock Exchange, and the company would be owned by BREIT.

The transaction is expected to close in the second quarter of 2022. The merger agreement also includes a 30-day "go-shop" period that will expire March 18.

Preferred Apartment Communities shares were up 8%, to $25.06, in premarket trading.

Write to Chris Wack at chris.wack@wsj.com

(END) Dow Jones Newswires

February 16, 2022 09:00 ET (14:00 GMT)

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