GIC JV Seeks to Buy Canadian Apartment REIT for $2.9B in All-Cash Deal

Singapore sovereign giant GIC and Canadian developer CLV Group have formed a joint venture to acquire Toronto-listed apartment trust InterRent for C$4 billion ($2.9 billion).

The all-cash deal includes assumption of debt and represents a 35 percent premium to the REIT’s unaffected closing unit price on the TSX as of 7 March, InterRent said Tuesday in a release. InterRent will have 40 days to solicit and consider superior proposals from third parties expressing an interest in acquiring the trust, with the JV reserving the right to match any such proposals received.

“We are pleased to provide immediate and certain premium value to our unitholders through this all-cash transaction with CLV Group and GIC, while also allowing InterRent to solicit superior proposals through a go-shop period of 40 days,” said Brad Cutsey, president and CEO of InterRent, which owns and operates 123 properties with 13,435 apartments across Toronto, Montreal, Vancouver and the company’s home city of Ottawa.

If completed, the deal would mark GIC’s second acquisition of a Canadian property trust, following the $801 billion fund’s 2023 buyout of Summit Industrial Income REIT in partnership with Dream Industrial REIT in a $4.4 billion cash deal.

Activist Pressure

CLV, a private firm owned by president and CEO Mike McGahan, has C$3 billion in assets under management and a development pipeline of more than 5 million square feet (464,515 square metres).

Because McGahan also serves as executive chair of the board at InterRent, the transaction with GIC would constitute a “business combination” under Canadian securities regulations, according to Tuesday’s announcement.

“We look forward to continuing to deliver exceptional value to residents through the operational excellence of our combined CLV and InterRent teams,” McGahan said.

The JV’s bid to take InterRent private follows a pressure campaign waged by activist investor Anson Funds, which built a 9 percent stake in the REIT, according to the Globe and Mail of Toronto. Media first reported on the Anson campaign on 7 March, the newspaper said.

North American Muscle

In addition to Summit REIT, which comprised 160 warehouses spanning 21.6 million square feet before the 2023 privatisation, GIC has teamed up with partners to buy out several other North American trusts.

That same year, the Singaporean fund joined forces with US private equity firm Centerbridge Partners to take NASDAQ-listed Indus Realty Trust private in a deal that valued the industrial REIT at $868 million.

In 2022, GIC and Oak Street, a division of Manhattan-based Blue Owl Capital, inked a $14 billion take-private deal for NYSE-listed Store Capital and its portfolio of 3,012 single-tenant commercial and industrial properties across the US.