Hunt Capital Partners and Centerline Holding Co., two prominent affordable housing finance firms, have agreed to merge.
Under the agreement, Hunt will acquire all of the outstanding common shares of Centerline (OTC: CLNH) for $39.89 per share. This comes after Hunt had acquired about 41 percent of the firm’s shares in April.
Hunt Cos. and Centerline are No. 2 and No. 3 respectively on the National Multi Housing Council’s list of Top 50 largest apartment owners, behind Boston Capital. The merger, which will double Hunt’s portfolio of multifamily units to more than 280,000, positions Hunt to move to the top of the list.
Hunt Capital Partners is part of the Hunt Cos., an owner, developer, manager, and financier of real estate assets. The El Paso, Texas-based firm has $16 billion of assets under management, including 144,200 multifamily units—79,000 of which are affordable—and 6.5 million square feet of commercial and retail space. Hunt has more than 1,000 employees in 17 offices.
Hunt Capital Partners entered the low-income housing tax credit (LIHTC) scene at the end of 2010.
Centerline through its subsidiary, Centerline Capital Group, is also a leading lender and LIHTC syndicator, managing a portfolio of $9.2 billion of investor equity with 144 funds and more than 140,000 multifamily units. Centerline’s 221 employees operate in 14 offices throughout the United States.
“Hunt is delighted to have reached this agreement with Centerline,” said Woody Hunt, CEO and chairman of Hunt Cos., in a statement. “Centerline is engaged in activities that are synergistic to Hunt’s core businesses, and we look forward to integrating the company’s capabilities with those of Hunt.”
The deal, which is subject to shareholder approval, is expected to close in the third quarter. Centerline’s board of trustees unanimously approved the transaction and recommended that shareholders support the merger.
“This transaction is accretive to Hunt’s core business, and we understand the portfolio,” said Alan Fair, president of Hunt’s affordable housing division. “This acquisition will effectively double our portfolio of multifamily units to more than 280,000 units, a majority of which will be affordable housing product, which further underscores our record of building value within this sector.”
Robert L. Loverd, chairman of Centerline's board, said “this transaction delivers great value to our shareholders and combines our company with a financially strong and highly regarded real estate finance, investment, development, and asset management company in Hunt.”