MAA and Colonial Properties Trust to Merge

MAA & Colonial Properties to merge in an 85,000-unit REIT; Post Properties closes on a $48.6 million buy in Orlando, Fla.; and Meridian Capital negotiates financing for mixed-use and multifamily properties in New York.

Memphis, Tenn., & Birmingham, Ala.—There is a new 285-property, 85,000-unit REIT in the making with news that MAA and Colonial Properties Trust have entered into a definitive agreement to merge. The result is a Sunbelt-focused multifamily powerhouse with an expected pro forma equity market capitalization of approximately $5.1 billion and a total market capitalization of $8.6 billion.

Under terms of the agreement, each Colonial Properties Trust common share will be converted into 0.36 newly issued MAA common share, and the combined company will be an UPREIT. On a pro forma basis, following the merger, former MAA equity holders will hold approximately 56 percent of the combined company’s equity, and former Colonial Properties Trust equity holder will hold approximately 44 percent. The merger is subject to customary closing conditions, though the parties expect the transaction to close during the third quarter of 2013.

“The combination of MAA and Colonial Properties Trust will provide an enhanced competitive advantage across the Sunbelt region,” says Eric Bolton, MAA CEO. “The scale of the combined company will support accelerated growth and deployment of capital across our high-growth Sunbelt markets driving superior value creation opportunity for our shareholders.”

“This is a combination that makes a lot of sense for the constituents of both Colonial Properties Trust and MAA,” adds Thomas H. Lowder, Colonial Properties Trust CEO. “Our two companies have a shared vision for success that will only be enhanced by coming together through this merger transaction. We are excited for the future of our combined company.”

Post Properties buys 300 units in Orlando

Orlando, Fla.—Post Properties has closed its $48.6 million acquisition of Crosswater at Lakeside Village, a 300-unit community located in the Windermere submarket of Orlando. The property, which has been renamed Post Lakeside, was recently completed this year and is in the late stages of its initial lease-up with 86 percent of the units leased. The property features a resort-style amenity package including a billiards room, swimming pool, fitness studio, lake-side beach, Zen courtyard, game room and Internet café.

The purchase price was paid out of Post Properties’ available cash balances. Post is predicting a first year stabilized yield on its investments to be approximately 5.2 percent, after deducting a three percent management fee and $300 per unit replacement reserve.

In connection with the acquisition, Post expects to commence the sale of one of its older Atlanta apartment communities, with the intent to complete a reverse like-kind exchange. That deal is expected to be completed by the fourth quarter of 2013.

Meridian negotiates financing for mixed-use and multifamily properties in New York and Brooklyn, N.Y.

New York–Meridian Capital Group LLC, a national commercial real estate finance and advisory firm, announced the following transactions:

-Meridian negotiated a new mortgage in the amount of $5.8 million on two multifamily buildings totaling 82 units located on East 94th Street and East 96th Street in Brooklyn, N.Y. The loan features a rate of 2.90 percent and a 10-year term. David Hayum negotiated this transaction.

-A new mortgage of $13,16 million was placed by Meridian on a 31-unit, mixed-use building featuring 5,100 square feet of retail space located on West Eighth Street in New York. The loan features a rate of 3.00 percent and a 10-year term. Carol Shelby and Dani Sabesan negotiated the transaction.

-Meridian negotiated a new mortgage in the amount of $8.9 million on two multifamily buildings totaling 52 units located on Ludlow Street in New York. The loan features a rate of 3.00 percent and a 10-year term. Cary Pollack negotiated this transaction.

-A new mortgage of $8.28 million was placed by Meridian on an 11-unit, mixed-use building featuring 3,500 square feet of retail space located on Ninth Avenue in New York. The loan features a rate of 3.25 percent and a three-year term. Scott Assouline and Jacob Nefoussi negotiated this transaction.

-Meridian negotiated a new mortgage in the amount of $5 million on a 68-unit, six-story multifamily building located on Thayer Street in New York. The loan features a rate of 3.00 percent and a 10-year term. Morris Diamant negotiated this transaction.

-A new mortgage of $3.25 million was placed by Meridian on a 19-unit, five-story multifamily building located on West 14th Street in New York. The loan features a rate of 3.00 percent and a 10-year term. Carol Shelby and Dani Sabesan negotiated this transaction.