H&R REIT to Sell $2.8B US Holdings

Canada-based H&R REIT will divest all holdings in a $4.8 billion deal (C$6.7 billion). GO Residential REIT is set to buy the company’s U.S. assets, valued at $2.8 billion, while Blackstone, Crestpoint and PSP Investments are expected to acquire H&R’s Canadian industrial properties. A company controlled by H&R CEO & Executive Chairman Tom Hofstedter’s family members will purchase the remaining non-core assets.

GO Residential’s 27-asset U.S. portfolio deal will total 10,294 multifamily units and 765,248 square feet of commercial space, including:

• 100 percent stake in 23 Sun Belt multifamily properties across markets such as Tampa, Fla., Dallas, Orlando, Fla., Miami, Raleigh, N.C., Austin, Texas, and Charlotte, N.C.
• 100 percent interest in the 669,554-square-foot Two Gotham Center Class A office building in Long Island City, N.Y.
• 100 percent stake in the 95,694-square-foot Dallas headquarters of Lantower Residential, a subsidiary of H&R  
• 50 percent interest in the 1,871-unit Jackson Park high-rise in Long Island
• 50 percent stake in the 528-unit River Landing mixed-use property in Miami

Overall, the properties have a 10-year average vintage. The Sun Belt markets where the collection is clustered feature shrinking supply and strong demand bolstered by employment growth, paving the way for net operating income improvement. For reference, these metros’ units under construction represented on average just 4.5 percent of stock as of June, compared to the 10.2 percent peak of 2022 and the average of 7.1 percent dating back one decade.

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GO Residential will fund the transaction by issuing 134,208,643 new trust units and paying $30 million in cash. The REIT will also assume $394.8 million (C$550 million) of H&R debt and $1.1 billion in property loans.

H&R unitholders will receive $12.01 per unit, representing a 14.5 percent premium compared to June 10, 2026, the last unaffected trading day prior to news of a potential Blackstone deal. Former H&R unitholders are expected to own roughly 67 percent of GO Residential, while current GO Residential unitholders will own the remaining 33 percent.

The deal may close in the fourth quarter of 2026, subject to court, unitholder and other customary approvals. Upon closing, GO Residential would become the seventh-largest publicly traded residential REIT in the U.S. and the second-largest in Canada.

REIT M&A activity picks up

U.S. REIT mergers and acquisitions ramped up earlier this year, with four new deals totaling $16.8 billion being announced year-to-date through April 15, according to an S&P Global report. The first quarter logged the highest volume since the end of 2023.

Some of this year’s REIT transactions included Affinius Capital and Vista Hill Partners’ deal to buy Veris Residential in a $3.5 billion agreement, announced in February and closed in May. In March, Public Storage agreed to buy National Storage Affiliates Trust’s self storage portfolio of 550,000 units in a $10.5 billion deal.