Multifamily giant Greystar is making a grab for more market share in the student housing space. The firm has entered into a definitive agreement to purchase EdR, a student housing development firm, in a $4.6 billion all cash deal. EdR’s board of directors unanimously approved the decision to move forward with acquisition, and EdR’s stockholders will receive $41.50 in cash per share.
“As a public company, one of our priorities is to maximize stockholder value and we believe this transaction with Greystar accomplishes that goal. We are certain today’s announcement is in the best interest of all of EdR’s stakeholders, including university partners, employees and stockholders,” EdR CEO and Chairman of the Board of Directors Randy Churchey said in a statement.
“For more than 50 years, EdR has been a pioneer in the student housing industry, partnering with some of America’s most prestigious universities to enhance and transform their campus housing and achieve their student success goals,” he added.
According to Churchey, investors will have received a total return of 293% since the January 2010.
“We are pleased to partner with a group of world-class investors to acquire one of the nation’s best student housing operators and developers. EdR has one of the highest quality and best located student housing portfolios in the U.S., and it will seed Greystar’s newly formed flagship student housing-focused perpetual-life fund. We are excited to capitalize on our significant scale and experience to enhance the platform’s performance and value over the long term,” Greystar Founder, Chairman and CEO Bob Faith said in a statement.
“EdR’s ONE Plan on-campus platform is an integral component that drove our interest and we are excited about the continued on-campus growth opportunities it provides. Combined, we will leverage our expertise, vision and financial strength to serve our current university partners as well as further expand our global student housing footprint. We believe in the long-term fundamentals supporting the sector and will continue to seek out opportunities to invest in student housing,” he added.
As part of the acquisition, Blackstone Real Estate Income Trust and an affiliate of Greystar will acquire a portfolio of off-campus student housing assets. The Greystar/EdR team will continue to manage the assets. Upon the completion of this transaction, BREIT will own a $10 billion portfolio of stabilized real estate assets.
The merger is set to close before the end of the year, barring any snags in the standard closing process.