Merge alert: Slow pace for M&A activity in H1 2019
With deals totaling $30 billion, strong merger and acquisitions (M&A) activity created a surge in the commercial real estate market in the second half of 2018. However, industry M&A slowed in the first half of 2019, where deals totaled just $2.2 billion — almost $28 billion less than the latter half of last year, according to data by Ten-X Commercial. But the comparison is lopsided given that the first quarter of 2018 recorded the highest total quarterly M&A deal value in real estate since 2009.
One of the largest 2018 real estate M&A deals to be announced was by Two Harbors Investment Corp., acquiring CYS Investments, a specialty finance company that invests on a leveraged basis primarily in residential mortgage. The sales price was $11.5 billion. Another high-priced M&A transaction was by Brookfield Asset Management, which paid $11.4 billion for Forest City Realty Trust.
Prologis also completed a high-priced M&A. It acquired DCT Industrial Trust for $8.1 billion.
Blackstone had the fourth-largest 2018 real estate M&A deal, purchasing Gramercy Property Trust for $7.6 billion. By comparison, the firm announced the largest deal during the first half of 2019, acquiring GLP U.S. Logistics Assets for $18. 7 billion — beating last year’s top U.S. transactions. And in September the firm announced plans to acquire all of Dream Global REIT’s subsidiaries and assets in an all-cash transaction valued at $6.2 billion.
Other top M&A real estate deals during the first half of 2019 included Ivanhoé Cambridge buying IDI Logistics for $3.5 billion and Park Hotels & Resorts acquiring Chesapeake Lodging Trust for $2.6 billion.
Total construction & real estate industry M&A deals in August 2019 totaled $1.74 billion in the United States, according to GlobalData’s deals database. The United States held a 10.9 percent share of the global construction & real estate industry M&A deal value, which totaled $15.99 billion in August 2019. In terms of deal activity, the United States recorded 47 deals during August 2019, marking a decrease of 20.3 percent compared with the previous month and a drop of 9.6 percent over the 12-month average.
While the numbers have dropped in August, there were huge deals announced in July 2019, including Prologis’ $3.99 billion acquisition of Industrial Property Trust and the $1.2 billion acquisition of Pure Multi-Family REIT by Cortland Partners.
