Lehman wins final Archstone stake for $1.58B

TRD New York /
May.May 25, 2012 09:30 AM

Lehman Brothers Holdings has beaten out Sam Zell and acquired the last remaining 26.5 percent stake in Archstone for $1.58 billion, the Wall Street Journal reported, giving it complete ownership over the massive apartment portfolio. The failed bank is buying the stake from Bank of America and Barclays, which partnered with Lehman to acquire Archstone in 2007 for $22 billion. The deal values the portfolio at $17 billion.

Since 2007 Lehman had held a 47 percent stake in Archstone. When the U.S. rental market began its meteoric rise last year, it couldn’t come to an agreement with BofA and Barclays as to how to manage the portfolio. The latter group wanted to sell the company, while Lehman wanted to take it public.

Sensing the discord, Sam Zell’s Equity Residential — Archstone’s biggest competitor — bid $1.33 billion to acquire half of the non-Lehman-owned stake. Lehman matched that bid. Lately, Zell has been bidding higher and higher for the remaining stake, before Lehman reached the $1.58 billion deal. Though he didn’t win the portfolio, Zell will be compensated $150 million: $80 million from a breakup fee and $70 million from Lehman. [WSJ]


Related Article

arrow_forward_ios
One Bryant Park (Credit: The Durst Organization)

Bank of America leads $1.6B refi for tower named after it at One Bryant Park

MCR Development CEO Tyler Morse and a rendering of TWA Flight Center

Revamped TWA Flight Center at JFK lands $270M loan

Dream Hotel Group's Sant Singh Chatwal (left) and Charles Holzer (right) and 355 West 16th Street (Credit: Getty Images and Google Maps)

Land under Dream Downtown hotel sells
for $175M

Prop trade blockchain startup gets backing from banks

Atlas Hospitality lands $40M loan for planned FiDi hotel tower

Despite an “overheated” market, Bank of America is ramping up its CRE exposure

arrow_forward_ios