Bluerock Residential Growth Spin-off
July 8, 2022 Update
BlueRock Homes Trust (need to create free account to access)
Good write up on VIC about upcoming spin-off of BlueRock Homes Trust.
The one thing holding me back is fair value for the spin-off. It’s attractive if the spin trades close to NAV, but I’m concerned it won’t.
July 7, 2022 Update
- Chris Demuth Jr. recommends buying this merger arbitrage for the spin-off
March 11, 2022 Update
- This merger proxy statement gives good background on how the transaction came about and about the spin-off.
- Here are some tidbits:
- Here is the form 10 statement.
- In theory this looks like an interesting set up as NAV is set at $5.60. Yet the market is valuing the stub at $2.25. However, NAV includes a bunch of mezzanine investments which are difficult to value.
- This could be an indiscriminate selling candidate as well given it will likely have a very small market cap relative to its parent.
December 24, 2021 Update
On the December 20th, Bluerock Residential Growth REIT (BRG) announced that it has entered into a agreement with Blackstone Real Estate that they will acquire all outstanding shares of common stock of BRG for $24.25 per share in an all-cash transaction valued at $3.6 billion, but prior to the acquisition, it will spin off its single family rental business. The spinoff transaction will be done through a taxable distribution to shareholders of all of the outstanding shares of a newly formed real estate investment trust named Bluerock Homes Trust, Inc. (BHOM).
BHOM will own interests in approximately 3,400 homes, including 2,000 through preferred/mezzanine investments, located in fast growing, high quality of life and knowledge economy markets across the United States. The estimated NAV of the new shares of BHOM is $5.60. Completion of the Acquisition, which is currently expected to occur in Q2 of 2022, is contingent upon the Spin-Off.