(Read more on the multifamily market and more on the debt and equity markets.)
NEW YORK CITY-Sentinel Omaha LLC, a fund managed by locally based Sentinel Real Estate Corp., has closed on the acquisition of all of the common shares of locally based America First Apartment Investors Inc., a multifamily REIT, in a transaction valued at $532 million, including the assumption of outstanding debt, according to Sentinel, as GlobeSt.com previously reported. The transaction was approved on Sept. 12 by America First shareholders.
According to the terms of the acquisition agreement, shareholders will receive $25.30 in cash for every common share held. As previously announced, APRO shareholders of record on Sept. 17 will also receive a prorated quarterly dividend payment in the amount of $0.23 per share. The America First portfolio includes apartments in mostly Southeast and Midwest states, such as the Greenhouse, a 126-unit mid-rise at 900 Farnam St. in Downtown Omaha, purchased in 2006.
As Sentinel Omaha has acquired all the outstanding shares of America First, the latter was merged into a subsidiary of Sentinel Omaha, and trading of APRO's common stock ceased as of the close of the market today. "Sentinel has a long history of acquiring and managing apartment communities," notes Mille Cassidy, president of Sentinel Real Estate Corp. in a release. "America First's portfolio consists primarily of traditional garden apartments in markets where Sentinel has operated similar properties."
Cassidy continues that, "we know the asset type and we know the markets. Sentinel expects to benefit both from repositioning the properties and from economies of scale as we integrate the new communities into our existing portfolio," he explains. "Additionally, we expect our debt capital markets group to help create value through the restructuring of the America First balance sheet. Throughout this transaction, our banking partners have provided unwavering support, and we expect our close relationship to be a significant asset to the transaction going forward."
No calls were returned to GlobeSt.com by deadline; however, Jack Cassidy, president and CEO of America First, previously told GlobeSt.com that the REIT had started out as a partnership, but was restructured as a trust in 2001 "once it became a little active." He said a sale was not the plan from the start, but "as a public company, we wanted to make sure our shareholders know that we would continue to grow. We felt what has happened in the marketplace today, significant values are being paid for real estate, we wanted to pursue all strategic options." He also noted that after the purchase he'll be looking for another property company to join or manage.
Sentinel currently owns and manages approximately 50,000 apartment units in 26 states throughout the US on behalf of its investors. The America First portfolio consists of 32 properties with over 7,000 units in 13 states. Sentinel Real Estate currently manages approximately $5 billion in real estate assets. Bank of America NA provided acquisition financing to Sentinel, and Paul, Hastings, Janofsky & Walker LLP acted as legal advisor.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
