Morgan Stanley, the biggest real estate investor among Wall Street banks, announced that it has agreed to acquire Richard Rainwater’s Crescent Real Estate Equities Co. for $2.78 billion. The offered price $22.80 per share is representing 5.5 percent more than Crescent’s last closing price. The total value of the deal is $6.5 billion including debt, Fort Worth, Texas-based Crescent said in its statement.
The acquisition includes the assumption and refinancing of about $3.1 billion of the company’s outstanding and unconsolidated debt and redemption of some $440 million in preferred shares. Additionally, as part of the definitive agreement with Morgan Stanley, Crescent will not pay any further dividends on its common shares. The company has been selling properties as part of a restructuring announced few months back, which was intended to concentrate the company entirely on its core office properties.
In fact, Crescent manages close to 70 office buildings in markets across the US with concentrations in Dallas, Houston, Austin, Denver, Miami, and Las Vegas. Crescent also holds investments in resort developments. Last month, Crescent has sold its resort and hotel properties for $620 million to Walton Hotel Investors, a fund managed by Chicago-based investment firm Walton Street Capital. Morgan Stanley will receive the cash for those properties.
On the other hand, Morgan Stanley owns more than 80 hotel properties across the globe, including the Arizona Biltmore Resort & Spa. Morgan Stanley spokeswoman Alyson D’Ambrisi has preffered to speak on the deal saying she had no comment on the purchase of Crescent.
