ILPT to Buy Monmouth for $4B
This deal would end a long pursuit by multiple investors.
Image by Gerd Altmann via Pixabay.com
Apparently ending the long quest for Monmouth Real Estate Investment Corp. by multiple suitors, Industrial Logistics Properties Trust will acquire the industrial REIT in a $4 billion deal, ILPT said on Friday morning.
The acquisition will add Monmouth’s 26 million-square-foot, 126-property portfolio to ILPT’s holdings, which currently encompass 290 properties and 36 million square feet. Closing is expected during the first half of 2022.
The Monmouth acquisition will bring such major new tenants as Home Depot, International Paper and Toyota. Geographic diversity is another attraction; Monmouth has a presence in 32 states, and gives ILPT the significant addition of footprints in Georgia and Texas. Other potential benefits will include the addition of e-commerce-focused, Class A properties, enhanced scale and an active pipeline for growth, ILPT added.
A major aspect of the acquisition that is yet to be announced is its complete financing. ILPT expects to strike a joint venture partnership with at least one institutional investor valued at between $430 million and $1.3 billion.
Also in the financing mix: Proceeds from new mortgage debt and the assumption of $409 million in Monmouth’s mortgage debt. ILPT also said it may sell as much as $1.6 billion worth of Monmouth assets; the extent of those dispositions depends on the size of the joint venture partnership.
Today’s announcement is the latest step in a long-running pursuit of Monmouth. In August, the REIT’s shareholders rejected a $3.4 billion offer from Equity Commonwealth, despite the proposal’s backing from Monmouth’s own board of directors. Starwood Capital Group jumped in with an unsolicited offer in July, and Blackwells Capital Group LLC made a $3.8 billion bid in December 2020.
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