AvalonBay, Equity Residential Strike Largest REIT Merger In U.S. History
Two of the country’s largest apartment landlords have agreed to an all-stock merger that would create a 180,000-unit REIT with a $69B enterprise value.
The deal between AvalonBay Communities and Equity Residential will make the combined firm the largest apartment owner in the country.
The deal, expected to close before the end of the year, would also be the largest REIT merger on record and 50% larger than the previous record holder, the merger of Prologis with Duke Realty in 2022, according to REIT investment and research firm Hoya Capital.
The combined AvalonBay-Equity company, which hasn’t yet been named, will maintain dual headquarters in Chicago and Arlington, Virginia.
The companies said the merger would generate roughly $125M in net synergies, including $50M associated with corporate overhead and $65M on property management, creating “one of the most efficient operators in the industry.”
The transaction was unanimously approved by both boards. AvalonBay shareholders will receive 2.793 shares of Equity Residential stock for each AvalonBay share they own and will control roughly 51.2% of the combined company.
Shares in both REITs opened down more than 1.5% in early trading Thursday.
AvalonBay CEO Benjamin Schall will take the top spot at the new REIT, which will initially have an evenly split board of directors, with each firm sending seven existing trustees, according to a presentation filed with the Securities and Exchange Commission.
Schall and the board chairs at Equity Residential, David Neithercut, and AvalonBay, Tim Naughton, will be on the new REIT’s board, which will be led by Steve Sterrett, a former Simon Property Group executive and independent director at Equity Residential.
The combined REIT is expected to generate roughly $2B in annual cash flow, giving it significant capacity to fund acquisitions and development internally, according to an SEC filing. The companies said the larger platform should create a fortress balance sheet and a long-term cost-of-capital advantage that supports additional growth.
The Biggest REIT Merger Ever?
— Hoya Capital (@HoyaCapital) May 21, 2026
Bloomberg is reporting that AvalonBay (AVB) and Equity Residential (EQR) - the two largest apartment REITs - are nearing an all-stock combination that would create the dominant publicly traded apartment REIT platform.
Under the terms of the… https://t.co/f3jfxXsMzg pic.twitter.com/gPk5J9fLWs
Together, the companies have 10,800 apartments under construction, representing roughly $4.4B in investment. Greystar is the largest apartment owner in the country, with 122,545 units at the end of 2025, according to the National Multifamily Housing Council.
“The combined company’s investors will benefit from accelerated growth from increased investment in operational innovation; a larger, self-funded development platform; and the variety of other value creation opportunities that world class scale affords,” Equity Residential CEO Mark Parrell said in a statement.
There is no mention of a shift in headcount as a result of the merger, but the presentation and merger announcement say the new REIT will leverage artificial intelligence to drive growth.
Both firms began using EliseAI, a property management solution, in 2019 and now use AI to drive 90% of their prospect workflows, amounting to 2.5 million combined annual customer interactions, according to the presentation.
Speculation about a tie-up between the companies intensified earlier this spring as apartment REITs struggled through a difficult 2025 marked by heavy new supply, softer rent growth and elevated operating costs.
The merger lands amid a wave of consolidation across commercial real estate as firms chase scale, cheaper capital and operational efficiencies in a higher-rate environment. CRE companies spent roughly $28B on acquisitions in the first quarter, including several major REIT transactions.
