Dream Residential Real Estate Investment Trust announced that it has entered into an agreement under which Morgan Properties will acquire the REIT in an all-cash transaction valued at approximately US$354 million.

Under the terms of the arrangement, unitholders of Dream Residential REIT and DRR Holdings LLC Class B units will receive US$10.80 per unit. The purchase price represents a 60% premium to the REIT’s closing unit price on the Toronto Stock Exchange as of February 19, 2025, the day before the REIT announced its strategic review, and an 18% premium to the closing unit price on August 20, 2025.

The board of trustees of Dream Residential REIT has unanimously approved the transaction, which follows the conclusion of the REIT’s strategic review process. The acquisition is expected to close in late 2025, subject to unitholder approval, court approval, and customary closing conditions.

Following the transaction, Dream Residential REIT will suspend its regular monthly distributions after the October payment, unless closing is delayed beyond November 18, 2025, in which case one additional monthly distribution may be paid.

As part of the transaction, Dream Unlimited Corp. and Pauls Corp., which currently provide asset management and administrative services to the REIT, have agreed to terminate existing agreements in exchange for a separation payment of US$7 million.

Each of the trustees and executive officers of the REIT, Dream, Pauls and certain affiliates have entered into voting and support agreements, representing approximately 22.5% of the votes of all outstanding units.

The deal will be implemented through a statutory plan of arrangement under Ontario law. The agreement also includes customary non-solicitation provisions, a termination fee of US$8.6 million payable to Morgan Properties under certain circumstances, and a reverse termination fee of US$25 million payable to the REIT.

TD Securities is acting as exclusive financial advisor to Dream Residential REIT, with Osler, Hoskin & Harcourt LLP and Clifford Chance US LLP serving as legal counsel. RBC Capital Markets is acting as exclusive financial advisor to Morgan Properties, with Stikeman Elliott LLP and Blank Rome LLP serving as legal counsel.

Dream Residential REIT owns a portfolio of garden-style multi-residential properties in U.S. Sunbelt and Midwest markets. Morgan Properties, headquartered in Conshohocken, Penn., is the largest private multi-family real estate owner in the United States, with a portfolio exceeding 100,000 units across more than 360 communities in 22 states.