independent valuation of the combined company.
Not all REI T deals stayed in the public domain. In
September of 2017 the newly formed perpetual-life
fund Greystar Growth and Income Fund LP, led by
Greystar Real Estate Partners and its initial founding
capital partners, affiliates of APG Asset Management
NV, GIC and Ivanhoé Cambridge acquired Monogram
Residential Trust, taking the multifamily developer
and owner private. The deal included the restructuring of Monogram’s joint venture with PGGM for a
total portfolio transaction value of approximately
$4.4 billion, including the PGGM JV and debt
assumed or refinanced.
Morgan Stanley Co. LLC served as exclusive
financial advisor and Goodwin Procter LLP served
as legal advisor to Monogram. JP Morgan Securities
LLC served as exclusive financial advisor and Jones
Day served as legal advisor to Greystar. Morgan,
Lewis & Bockius LLP served as legal advisor to
PGGM. Walker & Dunlop Inc. arranged the Freddie
Mac financing for the transaction.
The market saw another privatization when
Starwood Capital Group closed on its acquisition of
Milestone Apartments REIT, $1.3 billion transaction.
The deal required some back-and-forth as unit-holders pushed back on the initial offer. Milestone
had partnered with Starwood in 2015 to acquire
Landmark Apartment Trust, before receiving
Starwood’s initial privatization offer in January. That
bid gave the transaction an implied enterprise value
of $2.85 billion, including the assumption of debt.
Goodmans LLP and Vinson & Elkins LLP acted as
legal counsel to Milestone, while BMO Capital
Markets served as financial advisor to Milestone
and provided a fairness opinion to the special committee of Milestone’s board. National Bank Financial
provided the special committee with an independent fairness opinion. Stikeman Elliott LLP and
Kirkland & Ellis LLP are legal counsel to Starwood.
That transaction led to another sizeable deal in
2017—Freddie Mac’s $2.22-billion financing of
Starwood’s acquisition of Milestone. Berkeley Point
Capital secured the funds using the GSE’s ARM
product to provide a 10-year floating rate structure.
Berkeley Point and Starwood used Freddie’s Green
Advantage product, which enables borrowers to
qualify for better pricing and higher proceeds when
energy-saving improvements are introduced.
Starwood Capital’s participation in the program,
was based on its post-acquisition plans for the
portfolio. Managing directors Charlie Haggard and
Kevin Mignogna and assistant VP Peter Kurzeka led
the financing for Berkeley Point.
The deals were just as large and just as industry
shaking outside the CRE industry as they were
inside. Last year JAB took Panera Bread private for
$7.5 billion in an all-cash deal that included the
assumption of $340 million in debt. As a postscript
to this mega deal, Panera Bread went on to acquire
Au Bon Pain at the end of 2017. Barclays acted as
financial advisor, while Hogan Lovells and Arent Fox
were legal advisors to RLJ.
And of course, no round up of M&A could be
complete without mention of Amazon’s acquisition
of Whole Foods Market for $13.7 billion, a transaction that had, and continues to have, ramifications
across multiple industries. Among the changes
Amazon has made has been the establishment of
Amazon Locker pickup locations at the stores to
further its online e-commerce operations. But that
is a separate story about another type of industry