-- Ares Management (ARES) on Thursday agreed to acquire and take private real estate investment trust Whitestone REIT (WSR) in an all-cash deal worth around $1.7 billion.
Certain Ares Real Estate funds will purchase all Whitestone shares and operating partnership units for $19 apiece, representing a premium of 12% to the firm's closing price as of Wednesday, the companies said in a joint statement. Whitestone's stock climbed 11% in the most recent premarket activity, while Ares fell 1.3%.
In March, Reuters reported that several private equity firms, including Blackstone (BX), expressed interest in a potential acquisition of Whitestone.
"Whitestone's portfolio provides an attractive opportunity to further diversify Ares Real Estate's footprint with necessity-based retail centers in high-demand, supply-constrained metro regions across Arizona and Texas," David Roth, global head of real estate strategy and growth at Ares Real Estate, said in a statement. "Looking ahead, we are confident in Ares' ability to support and expand on the Whitestone portfolio and create value for both communities and investors."
As of March 31, Whitestone's portfolio comprised 56 retail properties in Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio.
The transaction, which requires approval from Whitestone's shareholders, is expected to complete in the third quarter. Following completion, Whitestone's shares will no longer trade on the New York stock exchange.
"We are excited to reach this agreement, which delivers significant, immediate and certain value to our shareholders while positioning Whitestone's assets for continued success," Whitestone Chair Amy Feng said.
In February, Whitestone said it expected core funds from operations to be in a range of $1.10 to $1.14 per share and operating partnership unit for 2026.