Blackstone has agreed to purchase Tricon, a Toronto-based company that owns about 38,000 rental homes in the U.S. and apartment buildings in Toronto, for US$11.25 per share in cash. The acquisition will be a joint venture between Blackstone Real Estate Partners X and Blackstone Real Estate Income Trust (BREIT).
This deal signifies Blackstone's deeper involvement in the single-family rental industry, which it was instrumental in developing post-2008 financial crisis. Blackstone had previously exited this market in 2019 by selling its shares in Invitation Homes but returned with investments in Tricon in 2020 and the acquisition of Home Partners of America in 2021.
Tricon, led by ex-Goldman Sachs banker Gary Berman, not only has a significant portfolio of rental homes in the U.S. but also owns apartment buildings in Toronto and land marked for future development. Blackstone plans to invest in Tricon's ongoing projects, totaling about US$3.5 billion, and inject an additional US$1 billion into future capital projects.
Nadeem Meghji, Blackstone's global co-head of Real Estate, expressed enthusiasm about supporting Tricon's expansion in housing supply in both the U.S. and Toronto. The transaction is anticipated to be finalized in the second quarter of this year.
BREIT, already holding an approximately 11% ownership stake in Tricon, will maintain this interest post-acquisition and has pledged to support the deal. The move comes as a part of a resurgence in market activity, with Blackstone’s CEO Steve Schwarzman noting a return of “animal spirits” in the industry and expectations of decreasing interest rates.