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Sam Zell’s Equity Commonwealth Agrees to Acquire Monmouth Industrial REIT

Equity Commonwealth and Monmouth Real Estate Investment Corporation have reached a merger agreement by which Equity Commonwealth will acquire Monmouth in an all-stock transaction, valued at approximately $3.4 billion, including the assumption of debt. The combined company is expected to have a pro forma equity market capitalization of approximately $5.5 billion.

Equity Commonwealth and Monmouth shareholders are expected to own approximately 65% and 35%, respectively, of the pro forma company following the deal’s closing.

“The transaction provides Equity Commonwealth with a high-quality, net-leased industrial business with stable cash flows while preserving EQC’s balance sheet capacity for future acquisitions,” said Sam Zell, chairman of the board of Equity Commonwealth.

Holmdel, NJ-based Monmouth’s portfolio includes 120 properties totaling 24.5 million square feet. The REIT also has six properties totaling 1.8 million square feet under contract and leased to investment-grade tenants. Closings for these acquisitions are expected in 2021 and 2022.

Following the merger announcement, Blackwells Capital LLC, which made an unsolicited offer for Monmouth last December, issued a statement saying, “We intend to review the merger documents and proxy when disclosed and consider our options. The transaction as disclosed is wholly inadequate. The industrial REIT space has materially re-rated since our $18 per share offer in December.

“Had the company engaged with Blackwells, its fourth largest shareholder, and not excluded it from the process, they would have seen we were prepared to potentially increase our all cash offer. Shareholders should be inherently suspicious of a transaction that is more aligned with the Landy family’s interests than maximizing value.”

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 16-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 7-10 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

  • ◦Acquisition
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