Nontraded REITs eye multifamily portfolio deals; VICI closes MGM Growth purchase

S&P Global Market Intelligence offers our top picks of real estate news stories published throughout the week.

Nontraded real estate investment trusts' share in U.S. private apartment deals rose to 10% in 2021, according to Real Capital Analytics. This compares to an average of 3% between 2015 and 2019.

The increase follows record fundraising between January 2021 and November 2021. The $32.8 billion raised was over three times larger than in 2020, Real Capital Analytics reported, citing investment bank Robert A. Stanger's data.

An increase in nontraded REIT megadeals involving apartment portfolios, and even entire companies, could materialize in 2022 as investors find ways to expedite capital deployment.

CHART OF THE WEEK: Average short interest in US REITs down 12 bps in 1st half of April

⮞ Average short interest in U.S. equity REITs dropped 12 basis points in the two weeks to April 14 to 3.0% of shares outstanding, according to data compiled by S&P Global Market Intelligence.

⮞ The regional mall sector remained the most-shorted REIT sector, and Pennsylvania REIT was the most-shorted REIT stock as of April 14.

Deals

* VICI Properties Inc. completed the $17.2 billion acquisition of MGM Growth Properties LLC. The buyer has an enterprise value of around $44.0 billion following the completion of the merger.

* Welltower Inc. remains interested in acquiring Healthcare Realty Trust Inc. after its $4.8 billion offer was rejected, Dow Jones Newswires reported May 4, citing people familiar with the matter. Healthcare Realty agreed in February to merge with Healthcare Trust of America Inc. in a roughly $10 billion cash and stock deal.

Property moves

* Boston Properties Inc. agreed to buy an office building in Seattle for a gross purchase price of around $730 million. The 37-story Madison Centre property spans approximately 760,000 square feet.

* Host Hotels & Resorts Inc. sold the Sheraton-New York Times Square hotel in Manhattan, N.Y., for $373 million.

* A Hyatt Hotels Corp. affiliate is selling Florida's The Confidante-Miami Beach hotel to Sunstone Hotel Investors Inc. for $232 million. The buyer intends to rebrand the property to Andaz Miami Beach.

* A joint venture between Bain Capital and Barbers Partners LLC seeks to develop about 15 class A cold storage warehouse facilities under the Chill Storage brand worth $500 million.

NAV Monitor: US equity REITs trade at 8.9% discount to NAV at April-end

REIT Replay: REIT share prices plummet during week ended April 29