AvalonBay Communities and Equity Residential are officially one, forming the largest apartment real estate investment trust in the country.
The two companies completed their merger of equals on Monday, they announced, moving forward as Vivmark Residential. The company will start trading on the New York Stock Exchange Tuesday.
The merger, revealed three months ago, creates a certifiable juggernaut in the multifamily industry. The company’s equity market capitalization is roughly $51 billion and enterprise value is approximately $70 billion. It has more than 184,000 units in its portfolio and another 11,000 under construction.
Vivmark easily tops other residential REITs, nearly doubling second place in total units and close to tripling the next closest competitor by enterprise value, according to a Vivmark investor presentation.
“Vivmark represents a transformational opportunity to redefine the rental housing industry, utilizing our scale and capabilities to deliver superior value for shareholders,” Vivmark chair Stephen Sterrett, lead trustee for Equity Residential, said in a statement; former AvalonBay chief executive Benjamin Schall is leading Vivmark.
In addition to the units already in place and under construction, the firm has a $4.2 billion development pipeline with nearly another 10,000 units raring to be built.
AvalonBay stockholders own approximately 51 percent of the company, while Equity Residential shareholders own approximately 49 percent of the company on a fully diluted basis. The company anticipates $125 million in savings in the next 18 months, according to the investor presentation, including $50 million from corporate overhead and $65 million from property management overhead.
The companies previously framed the transaction as a move to scale at a time when large landlords are increasingly leaning on technology. Executives have said the tie-up was a way to expand housing supply while lowering operating costs through AI tools, automation and centralized services.
Prior to the merger, Virginia-based AvalonBay’s portfolio spanned more than 300 properties and 100,000 units across 11 states, while Chicago-based Equity Residential had a portfolio of more than 300 properties and roughly 85,000 units across six states.
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