Mid-America Apartment Communities Inc, (MAA) announced that it would buy Colonial Properties Trust. The proposed deal was priced at US$2.17 billion. The offered deal was intended to expand the rental markets in the southern United States.
As the economy improves, US apartment rentals grow higher and vacancies decrease. In fact, the apartment vacancy rate has fell by 0.2% points compared to the 4.3% in the first three months of this year. This was also stated to be the lowest rate in more than a decade that was experienced by the apartment rental market.
The company announced last Monday that the acquisition of the asset will give MAA 85,000 multi-family units in a total of 285 properties in Sunbelt. MAA's next largest markets will be in Atlanta, Austin and Dallas. Raleigh, Nashville, Tampa and Charlotte are also listed on its top 10 largest markets along with Orlando and Houston.
According to MAA, with the two companies combined, the pro-forma equity market value is expected to be roughly US$5.1 billion and a total market of value of US$8.6 billion.
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