AvalonBay Equity Residential merger deal 2026

Equity Residential and AvalonBay Communities agreed to merge successful an all-stock woody that would make a combined institution with an endeavor worth of astir $69 cardinal and much than 180,000 rental apartments, the companies said Thursday.

Each AvalonBay stock volition beryllium exchanged for 2.793 shares of Equity Residential communal banal nether the merger agreement. That speech ratio would springiness AvalonBay investors a astir 51.2% involvement successful the caller entity, with Equity Residential shareholders holding the remaining 48.8%. The pro forma equity marketplace capitalization of the combined institution would beryllium astir $52 billion.

The deal, unanimously approved by some boards, is expected to adjacent successful the 2nd fractional of 2026, taxable to shareholder support from some companies and different customary closing conditions. The transaction is structured to suffice arsenic a tax-free reorganization for U.S. national income taxation purposes.

Expected outgo savings see $175 cardinal successful gross synergies, with $125 cardinal remaining connected a nett ground aft accounting for existent property taxation reassessments. With their portfolios overlapping successful 95% of markets, Reuters reported, the companies judge the geographic alignment volition enactment localized absorption structures and thrust down operating costs.

Benjamin Schall, who holds the apical occupation astatine AvalonBay, is slated to go main enforcement of the merged entity. Mark J. Parrell, who has spent 27 years astatine Equity Residential and presently serves arsenic its president and CEO, plans to measurement down erstwhile the woody is finalized. The combined institution volition transportation a caller sanction to beryllium announced astatine closing and volition support dual office successful Arlington, Virginia and Chicago, Illinois.

The 14-member committee volition beryllium divided evenly betwixt 7 trustees from each company. Steve Sterrett, presently pb autarkic trustee of Equity Residential and a erstwhile long-time CFO of Simon Property Group, volition service arsenic committee chairman.

As of March 31, 2026, AvalonBay owned oregon held an ownership involvement successful 319 flat communities containing 98,271 flat homes crossed 11 states and the District of Columbia, the institution said. Equity Residential owns and manages 312 properties with 85,211 flat units, the institution said.

The combined institution expects to wage an archetypal annualized dividend of $2.81 per share. The companies said they person $4.4 cardinal and 10,800 apartments presently nether operation crossed 32 communities.

On the advisory side, Bloomberg reported that AvalonBay turned to Goldman Sachs Group, portion Equity Residential worked with some Morgan Stanley and Centerview Partners.