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HRPT Acquires Hallwood Realty in $250M Deal

NEWTON, MA-HRPT Properties Trust purchases Dallas-based Hallwood Realty Partners, LP for approximately $250 million. Hallwood and its affiliates are merging with a subsidiary of HRPT, a locally based REIT, and will become a wholly owned subsidiary of the trust.

By Naomi Grossman | Updated on April 16, 2004

NEWTON, MA-HRPT Properties Trust, a locally based REIT, is acquiring Dallas-based Hallwood Realty Partners, LP for approximately $250 million. According to the terms of the deal, Hallwood and certain of its affiliates entered into an agreement with HRPT Properties in which Hallwood will merge with a subsidiary of HRPT. As a result of the merger, Hallwood will become a wholly owned subsidiary of HRPT and will no longer be a publicly traded limited partnership.

In the merger, holders of limited partnership units of Hallwood will receive nearly $138 per unit. Completion of the merger is subject to certain conditions, including approval by the unitholders of the merger agreement and the merger. The Hallwood Group Inc., the indirect sole owner of Hallwood Realty LLC, and its real estate subsidiaries have also entered into a purchase agreement, in which HRPT will purchase the general partner interest in the partnership, the 330,432 units indirectly owned by Hallwood Group, and the interests in each of the other entities through which Hallwood Group holds interests in the partnership, for nearly $67 million.

As part of the deal, Hallwood Group also agreed that its agreements for the management of the partnership’s properties will be terminated. In the purchase agreement, Hallwood Group says it will vote all of the units it owns in favor of the merger.

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