Blackstone has acquired Canadian real estate firm Tricon Residential for USD 3.5 billion, making it private and boosting Tricon's shares by 28% in the US market. The deal, closing in Q2, sees Blackstone buying all Tricon shares at USD 11.25 each, a 30.35% premium. Tricon, known for single-family rentals, plans to finish a USD 1 billion U.S. development and a USD 2.5 billion Canadian apartment pipeline. Amid Canada's housing crisis, the government removed a 5% tax on new rental building construction last year. Tricon's shares will delist but remain Toronto-based, focusing on affordable housing in the U.S. Sun Belt and Canada under Blackstone.
Blackstone, an investment management company, has agreed to acquire Canadian real estate firm Tricon Residential for USD 3.5 billion, taking the company private. This move has resulted in a significant boost to Tricon's U.S.-listed shares, increasing by approximately 28% at the market's opening. Blackstone Real Estate Partners, along with Blackstone Real Estate Income Trust, will jointly acquire all outstanding common shares of Tricon for approximately 15.17 Canadian dollars or USD 11.25 per share marking a substantial 30.35% premium over the stock's last closing price.
Tricon Residential primarily focuses on providing single-family rental housing and rental development in both the United States and Canada. Post-acquisition, Tricon plans to finalize its USD 1 billion development pipeline for new single-family rental homes in the U.S. and USD 2.5 billion worth of new apartments in Canada. The deal is expected to be completed in the second quarter of the current year.
This acquisition comes at a crucial time for Canada, facing an affordable housing crisis. The Canadian government announced the removal of the federal 5% consumption tax on the construction of new rental apartment buildings last year, aiming to stimulate the supply of affordable housing. Morgan Stanley and RBC Capital Markets are serving as financial advisers to Tricon in this deal.
Tricon, which owns, operates, and develops a portfolio of around 38,000 single-family rental homes in the U.S. Sun Belt and multifamily apartments in Canada, also provides residential services through its tech-enabled operating platform.
Following the acquisition, Tricon's shares will no longer be listed on the New York Stock Exchange or the Toronto Stock Exchange, but the company will continue to be based in Toronto. Under the new ownership, Tricon has ambitious plans, including completing its development pipeline, investing USD 1 billion in planned capital projects over the next several years, and focusing on addressing the affordable housing challenge in both the U.S. and Canada.
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