Wall Street Analysts Are Not Fans Of JBG-New York REIT Merger

Wikipedia

Confirmation of the mega-merger between The JBG Cos and New York REIT to form JBG Realty Trust has struck a minor chord on Wall Street.

Several analysts have questioned the move, which prompted shares of New York REIT to take a hit in yesterday’s trading. Shares in the REIT dropped more than 8%, their largest decline since shares started trading publicly in 2014, Bloomberg reports.

The merger agreement will see JBG, the DC region’s largest developer, acquire the NY-based REIT to form an $8.4B company with holdings in DC and NYC. JBG and its affiliated companies are slated to control the majority of the new company and its board seats, while New York REIT’s shareholders will control a minority interest and a single board seat. Analysts are questioning whether the move is in the best interest of New York REIT shareholders.

New York REIT owns 19 assets in New York City, while JBG owns 72 assets in the greater DC region. JBG also has a pipeline full of projects that are either on the way or in the planning stages, including two 31-story towers—one office, one apartments—under construction in Rosslyn, VA. [Bloomberg]

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