REITs

Sidley has been at the forefront of the growth of the REIT industry over the past 40 years, organizing, advising, and financing equity and mortgage/specialty finance REITs. We have worked with REITs focusing on the full range of property types, including office, hotel, resort, multi-family, single-family residential, student housing, retail, mall, outlet, net-lease, data center, healthcare, hospitality, timber, industrial, cold storage, and mortgage, among others, giving us insight into the particular issues with regard to different asset types.

We have substantial experience in a wide variety of REIT securities offerings, including IPOs, forward equity transactions, Rule 144A initial offerings of common stock, operating partnership units (“OPUs”) deals, DownREIT deals, convertible preferred stock offerings, convertible/exchangeable debt offerings, Rule 144A debt offerings, high yield debt offerings, private placement debt (“USPP”) offerings, and remarketed/extendible debt and warrants offerings. This work requires not only an extensive knowledge of the Securities Act of 1933 and the related rules, but also a well-developed understanding of marketplace standards and practices particular to REITs.

Sidley has been very involved in mergers and acquisitions, and other business combinations and reorganizations by or among REITs. We have represented acquirers or targets in more than 155 joint ventures, strategic alliances, mergers, acquisitions, or dispositions involving REITs or REIT portfolios exceeding US$107 billion since 2009.

Our tax lawyers are essential to servicing our REIT clients. We provide tax advice on structuring new REITs, qualifying as a REIT, the use of captive REITs, REIT M&A, private REITs, and utilizing taxable REIT subsidiaries. Sidley’s Tax practice group also has extensive experience in REIT conversions and business combinations, and has represented REITs on a variety of matters before the Internal Revenue Service.

We advise our REIT clients on a broad spectrum of matters apart from offerings of securities, M&A, and tax, including:

• Counseling boards of directors and advising on corporate governance;
• Real estate joint ventures;
• Construction and development financing;
• Executive compensation;
• 1934 Act filings;
• Lending;
• Real estate acquisitions and financing;
• Bankruptcy, workouts, and restructuring;
• Real estate fund formation;
• Leasing;
• Securitizations;
• 1940 Act status; and
• Environmental.

Representative Experience

• A publicly registered healthcare REIT in its US$772.8 million initial public offering and the listing of its common stock on the New York Stock Exchange.
• The underwriters in connection with a US$1.72 billion common equity block trade completed in November 2023 by a REIT that invests with leading seniors housing operators, post-acute providers, and health systems. The transaction was the largest REIT common equity offering year-to-date in 2023.
• The underwriters in connection with a US$5.0 billion inaugural public offering of senior notes issued by a wholly-owned subsidiary of an experiential REIT that owns one of the largest portfolios of gaming, hospitality, and entertainment destinations.
• The underwriters in the US$103 million initial public offering of a commercial mortgage REIT.
• A REIT that invests in a diversified portfolio of structured finance assets, as well as affiliated entities, in the establishment and issuance of a $1.5 billion CRE CLO securitization. The transaction is the second largest CRE CLO ever issued.
• A REIT and a leading owner and operator of single-family homes for lease in connection with their inaugural public debt offering of US$650 million of 2.000% senior notes due 2031.
• A mortgage REIT in connection with its initial public offering of US$136.8 million and a concurrent private placement of US$40 million to an institutional investor.
• A real estate company with a high-quality portfolio of over 17,000 homes across the U.S. in its acquisition by an affiliate of a publicly owned alternative asset manager in a transaction valued at US$6.0 billion.
• The underwriters in connection with a US$800 million notes offering by a subsidiary of a publicly traded, net-lease REIT, consisting of US$450 million 2.100% Notes due 2028 and US$350 million 2.700% Notes due 2032. The underwriters comprise some of the world’s top-tier financial institutions.
• An investment vehicle owned by a real estate investment firm and a business development company in the acquisition of a REIT engaged in the ownership of single-family rental assets in a transaction valued at approximately US$2.4 billion.
• The largest owner and operator of marinas in the world in its sale to a publicly traded REIT in a transaction for cash and equity valued at US$2.11 billion.
• The underwriters in connection with the largest retail real estate investment trust in the U.S. in its sale of US$500 million principal amount of its 3.500% senior notes due September 2025, US$750 million principal amount of its 2.650% senior notes due June 2030, and US$750 million principal amount of its 3.800% senior notes due June 2050.
• One of the largest global alternative asset managers in providing a US$500 million senior secured loan to, and its commitment to buy over the next 12 months the lesser of 4.9% or US$50 million in the common shares of, a REIT in the U.S. that invests in residential mortgage assets.
  
  In addition, a retirement services company and a British universal bank have entered into a non-mark to market term borrowing facility of approximately US$1.65 billion. The lender and the retirement services company will also receive a warrant package to purchase shares of the REIT’s common stock at varying prices over a five-year period.

• The underwriters in connection with a public offering of 9,200,000 shares of common stock on a forward basis by a net-lease REIT, resulting in gross proceeds to the issuer of approximately US$343.6 million. The underwriters comprise some of the world’s top-tier financial institutions.
• Affiliates of a private investment firm in its US$325 million purchase of preferred equity and detachable warrants in a commercial real estate finance company.
• A real estate company that acquires, owns, and manages single-tenant properties in the U.S. in its offering of 7.935 million shares of common stock, resulting in gross proceeds of approximately US$200 million.
• An internally managed REIT in its US$451.5 million secondary offering of common stock that closed in July 2019.
• The underwriters in the US$2.15 billion common stock offering by a REIT specializing in casino properties that closed in June 2019.
• Leading single-family rental REIT in connection with its US$21 billion merger with another leading single-family rental REIT, creating a premier single-family REIT.
• The underwriters in four offerings of common stock by the first publicly traded cold-storage REIT with an aggregate value of US$4.2 billion, including its US$833 million initial public offering.
• The underwriters in three offerings of common stock by a leading REIT specializing in casino properties with an aggregate value of US$3.9 billion, including its US$1.2 billion initial public offering, the largest REIT IPO in 2018 and fourth largest REIT IPO ever.
• Net lease properties REIT in two offerings of common stock with an aggregate value of US$670 million, including its US$455 million initial public offering.
• Specialty finance company that invests in a variety of residential mortgage loans and mortgage-related assets in the public offering of US$176 million of common shares.
• The underwriters in the largest retail REIT’s US$543 million common stock offering, the watershed transaction in the re-equitization of REITs in 2009.
• The underwriters in registered offerings of US$700 million of common stock by a leading national industrial REIT.
• The underwriters in common stock offering of US$430 million by a premier office and industrial REIT.
• The underwriters in two public offerings of Series B and Series C preferred stock with an aggregate liquidation preference of US$652 million issued by a publicly traded residential mortgage REIT.
• The underwriters in public offering of US$500 million of notes issued by a leading global healthcare REIT. The underwriters in common stock offering of US$696 million issued by a large net lease REIT.
• Preeminent publicly held office building owner and manager in its US$39 billion acquisition by Blackstone Funds, one of the largest leveraged buyout transactions in history.
• The underwriters in an IPO for a REIT that has been recognized as marking the “dawn of the modern REIT era.”