12/20/2021 | by Nareit Staff

Bluerock Residential Growth REIT, Inc . (NYSE American: BRG) said Dec. 20 that it has agreed to be sold to affiliates of Blackstone Real Estate in an all-cash transaction valued at $3.6 billion.

Bluerock also said that prior to the acquisition, which is expected in the second quarter of 2022, it intends to spin off its single-family rental business into a newly formed REIT named Bluerock Homes Trust, Inc. (BHOM). It will be externally managed by an affiliate of Bluerock Real Estate.

Blackstone will pay $24.25 per Bluerock share. Excluding the value of BHOM, the transaction represents a premium of approximately 124% over the closing stock price on Sept. 15, the date prior to a media article reporting that Bluerock was exploring strategic options, including a sale.

“We believe the substantial premium to our historic trading price is a testament to our success in building a best-in-class institutional-quality multifamily apartment portfolio in our attractive knowledge-economy target markets,” said Ramin Kamfar, Bluerock chairman and CEO.

Bluerock said Blackstone will acquire 30 multifamily properties comprising approximately 11,000 units as well as a loan book secured by 24 multifamily assets. The properties are garden-style assets with significant green space and resort-style amenities, built, on average, in 2000. The majority of the properties are located in Atlanta, Phoenix, Orlando, Denver, and Austin.

Meanwhile, BHOM will own interests in approximately 3,400 homes, including 2,000 through preferred/mezzanine investments, located in fast growing, high quality of life and knowledge-economy markets across the United States. Bluerock shareholders will receive shares of BHOM, with a current implied net asset value estimated at $5.60.