Morgan Stanley's Prime Property Fund agreed to buy AMLI Residential Properties Trust of Chicago for $2.1 billion.
The purchase would add more than 28,300 apartments to the fund's portfolio of office, retail, industrial, and residential properties.
AMLI's investors and members of its operating partnership would receive $37.75 in cash for each of their shares and units, Morgan Stanley said Monday. That's a 21% premium over AMLI's closing price Friday. The price includes debt and preferred securities.
The acquisition, expected to close in the first quarter, would expand the $4.5 billion fund's holdings in the fast-growing Southeast, the Southwest, the Midwest, and the mountain regions. This month the fund bought six Washington-area office sites for $644 million.
"Multifamily is attractive, because of its low volatility and higher risk-adjusted returns relative to other property types," said Dave Hardman, Morgan Stanley's head of U.S. real estate investing.
