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Colony NorthStar to create commercial real estate credit REIT
Real Estate - AUGUST 28, 2017

Colony NorthStar to create commercial real estate credit REIT

by Released

Colony NorthStar and affiliates of NorthStar Real Estate Income Trust, a public, non-traded REIT, and NorthStar Real Estate Income II, a public, non-traded REIT announced that they have entered into a definitive tri-party agreement under which a select portfolio of Colony NorthStar assets and liabilities will combine with NorthStar I and NorthStar II in an all-stock combination transaction to create a leading commercial real estate credit REIT with approximately $5.5 billion in assets and $3.4 billion in equity value.

The transaction has been approved by the board of directors of Colony NorthStar and unanimously approved by the special committees and boards of directors of NorthStar I and NorthStar II. The combined company will be named “Colony NorthStar Credit Real Estate.

Upon completion of the transaction, Colony NorthStar, NorthStar I stockholders and NorthStar II stockholders will each own approximately 37 percent, 32 percent and 31 percent, respectively, of the company on a fully diluted basis, subject to certain adjustments as set forth in the combination agreement. The closing of the transaction is conditioned upon a listing of the company’s class A common stock on a national securities exchange, which may be effected up to nine months following approval of the transaction by the NorthStar I and NorthStar II stockholders.

At the closing, Colony NorthStar will be the largest single investor in the company and will enter into a management agreement on market terms to serve as the company’s external manager.

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