Cottonwood Communities Inc., a publicly registered non-traded real estate investment trust, has closed its previously announced merger with Cottonwood Residential II Inc. and its operating partnership, Cottonwood Residential O.P. LP.
The combined company, Cottonwood Communities, is a $1.6 billion multifamily focused REIT comprised of 35 apartment communities and other real estate-related investments located predominantly in growth markets across 12 states. The weighted average occupancy is 94.9 percent as of December 31, 2020.
Solicitation for approval of the partnership merger by non-management Cottonwood Residential O.P. unitholders resulted in 83 percent voting, with 97 percent in favor of the merger transaction, 1 percent against and 2 percent abstaining.
“We appreciate the confidence our security holders have placed in us over the years and their support in favor of the merger,” said Daniel Shaeffer, chief executive officer of Cottonwood Communities. “We feel the size and scale of the combined company will allow us to recognize operating expense efficiencies, enhance geographic diversification and expand access to capital to pursue potential accretive transactions.”
Under the terms of the merger, in exchange for each share of common stock owned, Cottonwood Residential II stockholders received 2.015 shares of Cottonwood Communities common stock, while operating partnership units in Cottonwood Residential O.P., the surviving operating partnership, split into 2.015 units. The combined company is expected to publish its first net asset value this month.
Further, in connection with the merger, Cottonwood Communities made certain changes to its officers, resulting in the following appointments of individuals, all of whom previously held executive roles in one or more of Cottonwood Communities or Cottonwood Residential II and its affiliates:
- Daniel Shaeffer, Chief Executive Officer
- Chad Christensen, Executive Chairman of the Board
- Gregg Christensen, chief legal officer and secretary
- Glenn Rand, Chief operating officer
- Enzio Cassinis, President
- Adam Larson, chief financial officer
- Susan Hallenberg, chief accounting officer and treasurer
- Stan Hanks, executive vice president
- Eric Marlin, executive vice president of capital markets
- Paul Fredenberg, chief investment officer