Tishman SPAC Strikes Deal With Smart Lock Provider

A special purpose acquisition company launched in late 2020 by Tishman Speyer has announced a merger with smart lock and SaaS company Latch, Inc., in a deal that will allow the building software provider to go public.

The deal brings together Latch and TS Innovation Acquisitions Corp., CRE giant Tishman Speyer Properties LP’s special purpose acquisition company, or SPAC. When the deal – which values Latch at $1.56 billion – closes in the second quarter of 2021, Latch expects to have up to $510 million in cash to fund growth initiatives and expansion plans. Tishman will receive an estimated 4% position in Latch valued at approximately $60 million.

Latch offers a multifamily operating system that features smart access, delivery and guest management and smart home and sensors. It has relationships with some of the  largest residential real estate owners including Alliance, Avalon Bay, Greystar, NRP Group, AMLI Residential, Prometheus, RXR Realty and Toll Brothers. Tishman Speyer was an early investor and user of the product and as part of the transaction, Latch will be implemented in much of the company’s  extensive real estate holdings—an international portfolio that encompasses nearly 80 million square feet across many asset classes.

“Our mission has been to partner with a growing company; one with a great team, a strong and differentiated business model and the ability to scale quickly through our platform,” says Rob Speyer, president and CEO of Tishman Speyer and CEO and chairman of TSIA in prepared remarks. 

Often called blank check companies, SPACs are publicly-traded shell companies formed to pursue private sector deals by raising capital in an IPO and then seeking acquisition targets; those acquired companies then use the SPAC to sell shares to the public in a bypass of the traditional IPO process. 

They are fast becoming preferred vehicles for large investors: Dealogic data shows that SPACs raised $82.1 billion in 2020, a sixfold increase over the prior year. And Tishman – whose portfolio includes Rockefeller Center and The Springs in Shanghai – is among the highly-capitalized CRE firms entering the space. In the latter half of 2020, a handful of CRE SPAC offerings hit the market, including Tishman’s $300 million SPAC.

CBRE filed for a $350 million SPAC in December 2020, Property Solutions Acquisition launched a $200 million IPO in July, and Sam Zell launched Equity Distribution Acquisition Corp., a SPAC targeting the industrial sector, in August.