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Landmark Apartment Trust Agrees to $1.9 Billion Merger

Landmark Apartment Trust Inc., a non-traded real estate investment trust that owns approximately 24,000 apartment units throughout the Southern United States, announced that it has entered into a definitive merger agreement pursuant to which it will be acquired by Monument Partners LLC, an entity owned by affiliates of Starwood Capital Group and Milestone Apartments Real Estate Investment Trust, in an all-cash transaction valued at approximately $1.9 billion, including the assumption of existing debt. Upon completion of the transaction, Landmark will become a privately held company.

Pursuant to the terms of the merger agreement, Monument will acquire all of the outstanding common stock of Landmark and all of the outstanding common units of Landmark’s operating partnership for $8.17 per share or common unit in an all-cash transaction. Payment of the per share and per common unit consideration is net of all transaction expenses incurred by the company.

Original investors in Landmark common stock paid $10 per share during the company’s public offerings between 2006 and 2010, when it was known first as NNN Apartment REIT and then Grubb & Ellis Apartment REIT following the reverse merger of NNN Realty Advisors and Grubb & Ellis Company in 2007.

Landmark’s board of directors has approved the merger agreement and has recommended approval of the merger by its stockholders, upon whose majority approval the transaction is contingent. The merger is expected to close during the first quarter of 2016.

“I am pleased to announce [the] acquisition by Starwood and Milestone. Given that many stockholders have held shares for many years, our board believes that liquidity is a primary driver for our stockholder constituency. This is an all cash transaction giving stockholders immediate liquidity at closing,” said Ed Kobel, chairman of the Landmark board of directors.

“[This] announcement marks the successful conclusion of a strategic review process that our board of directors undertook earlier this year, which included the potential for an initial public offering. Given recent market volatility, we believe that this merger provides our stockholders with a more certain liquidity event,” said Jay Olander, chief executive officer of Landmark. “Management and the board of directors support the transaction and will work diligently to ensure a smooth transition.”

In May, Landmark had announced its intention to list its shares on the New York Stock Exchange under the ticker symbol “LAT.” Earlier this month, as reported by The DI Wire, MacKenzie Realty Capital Inc. launched a tender offer for 1.3 million shares of Landmark at $5.10 per share. In light of the merger agreement, the Landmark board has recommended that its stockholders reject the MacKenzie tender offer.