Shareholders of Watermark Lodging Trust Inc., a publicly registered non-traded real estate investment trust, have approved the proposed acquisition of the REIT by private real estate funds managed by Brookfield. The $3.8 billion proposed transaction was announced in May 2022.
Watermark Lodging Trust was created by the April 2020 merger of non-traded REITs, Carey Watermark Investors 1 and Carey Watermark Investors 2, which were previously advised by W. P. Carey.
Under the terms of the transaction, Watermark Lodging Trust stockholders will receive cash consideration of $6.768 per Class A share and $6.699 per Class T share. The purchase price represents a premium of more than 7.5 percent from the most recently published net asset values per share of $6.29 per Class A share and $6.22 per Class T share, as of December 31, 2021.
“I would like to thank our stockholders for their support of this transaction and the entire Watermark team for their hard work and commitment throughout this process,” said Michael Medzigian, chairman and chief executive officer of Watermark. “With this critical step now accomplished, we look forward to completing the transaction with Brookfield and delivering cash liquidity to our stockholders.”
Shareholders approved the proposed merger at a special meeting held on September 9th where approximately 118.5 million shares voted in favor of the merger, 5.6 million voted against, and 5.1 million abstained.
The transaction is slated to close around October 21, 2022.
Watermark Lodging Trust is a self-managed, non-traded REIT that invests in lodging and lodging-related properties. The Watermark portfolio is comprised of 24 upscale lodging properties with roughly 7,900 rooms located in 14 states with a high concentration in the Sun Belt region. The hotels were originally purchased for $2.9 billion.
Brookfield is a global alternative asset manager with approximately $750 billion of assets under management across real estate, infrastructure, renewable power and transition, private equity, and credit.