Blackstone announces acquisition of Tricon Residential

Key Takeaways:

• The US$3.5 billion deal includes Tricon’s multi-family development platform in Toronto.
• The company plans to complete its US$2.5 billion development pipeline of 5,500 new apartments in Canada.
• The company’s single-family business in the U.S. has approximately 2,500 homes under development. 

The Whole Story:

Blackstone, the world’s largest alternative asset manager, plans to purchase Tricon Residential in a US$3.5 billion deal.

Blackstone and Tricon Residential announced that they have entered into an arrangement agreement under which Blackstone Real Estate Partners X together with Blackstone Real Estate Income Trust, Inc. (BREIT) will acquire all outstanding common shares of Tricon. The transaction price represents a premium of 30% to Tricon’s closing share price on the NYSE on January 18, 2024, the last trading day prior to the announcement of the Transaction, and a 42% premium to the volume weighted average share price on the NYSE over the previous 90 days, and equates to a $3.5 billion equity transaction value based on fully-diluted shares outstanding. BREIT will maintain its approximately 11% ownership stake post-closing.

Tricon provides rental homes and apartments, along with resident services through its tech-enabled operating platform and dedicated on-the-ground operating teams. Tricon serves communities in high-growth markets such as Atlanta, Charlotte, Dallas, Tampa and Phoenix as well as Toronto, Canada. In addition to managing a single-family rental housing portfolio, Tricon has a single-family rental development platform in the U.S. with approximately 2,500 houses under development, as well as numerous land development projects that can support the future development of nearly 21,000 single-family homes.

The company also has a Canadian multifamily development platform that is building approximately 5,500 market-rate and affordable multifamily rental apartments.

“We are proud of the significant and immediate value that this transaction will deliver to our shareholders, while allowing us to continue providing an exceptional rental experience for our residents. Blackstone shares our values and our unwavering commitment to resident satisfaction, and we look forward to benefitting from their expertise and capital as we partner in building thriving communities,” said Gary Berman, president & CEO of Tricon.

Under Blackstone’s ownership, the company plans to complete its US$1 billion development pipeline of new single-family rental homes in the U.S. and US$2.5 billion of new apartments in Canada (together with its existing joint venture partners). The company will also continue to enhance the quality of existing single-family homes in the U.S. through an additional US$1 billion of planned capital projects over the next several years.

“Tricon provides access to high-quality housing, and we are fully committed to delivering an exceptional resident experience together,” said Nadeem Meghji, global co-head of Blackstone Real Estate. “We are excited that our capital will propel Tricon’s efforts to add much needed housing supply across the U.S. and in Toronto.”