June 3 U.S. real estate investment trust Mid
America Apartment Communities Inc said it would buy
rival Colonial Properties Trust for about $2.17 billion
to expand in the apartment rental market in southern United
U.S. apartments rents are rising and vacancy rates are
falling as the economy improves. The apartment vacancy rate fell
by 0.2 percentage points to 4.3 percent in the first three
months of 2013 - the lowest in more than a decade.
The acquisition will give MAA an asset base of about 85,000
multifamily units in 285 properties across in the Sunbelt, the
company said on Monday.
After the deal, MAA's 10 largest markets will be Dallas/Fort
Worth, Atlanta, Austin, Raleigh, Charlotte, Nashville,
Jacksonville, Tampa, Orlando and Houston.
Under the deal, MAA will offer 0.36 common shares for each
Colonial Properties Trust unit.
Based on MAA's closing share price of $67.97 on Friday, the
offer of $24.47 per share represents an 11 percent premium to
Colonial Properties' Friday close.
The combined company is expected to have a pro-forma equity
market value of about $5.1 billion and a total market value of
$8.6 billion, MAA said.
Colonial Properties Trust shares were up 5 percent at $23.31
in morning trade on the New York Stock Exchange. MAA shares were
down more than 3 percent at $65.70.