Colony NorthStar Inc., a Los Angeles-based global real estate investment firm with more than $56B worth of assets under its belt, has partnered with two affiliates to create a new commercial real estate credit REIT with $3.4B in equity value.
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The REIT will have $5.5B worth of assets under management, according to a release. It will be the second-largest publicly listed commercial mortgage REIT based on equity value.
Through the transaction, which Colony NorthStar’s board and shareholders already have approved, each company’s stockholders will own roughly a third of the new REIT, named Colony NorthStar Credit Real Estate Inc.
Colony NorthStar will hold a 37% stake, while publicly traded NorthStar Real Estate Income Trust will hold a 32% and NorthStar Real Estate Income II will own a 31% interest.
After the transaction closes, Colony NorthStar will serve as the REIT’s external manager and the company’s executive vice president and chief investment officer, Kevin P. Traenkle, will be the new CEO for Colony NorthStar Credit Real Estate.
The deal is expected to close in late 2017 or in the first quarter of 2018.
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