Brookfield, CPP Strike $5.2B Deal for LXP Industrial Trust

Brookfield Asset Management and the Canada Pension Plan Investment Board are making more industrial real estate bets, this time agreeing to acquire LXP Industrial Trust in a $5.2 billion all-cash deal.

The buyers will pay LXP shareholders $61.20 per share in cash, valuing the transaction at roughly $5.2 billion including net debt and preferred equity, according to the companies. The price represents a 12.3 percent premium to LXP’s 30-day volume-weighted average share price and a 19.8 percent premium to its 90-day average.

The deal is expected to close in the fourth quarter, pending shareholder approval and customary closing conditions.

The pending acquisition hands Brookfield and CPP one of the larger institutional industrial portfolios in the country. LXP owns about 53 million square feet of warehouse and logistics space spread across 108 properties concentrated in Sun Belt and Midwest markets. The portfolio features modern facilities, high occupancy and long-term leases.

The transaction also caps a yearslong transformation for LXP, which shed other holdings and repositioned itself as a pure-play industrial real estate investment trust. That strategic pivot mirrored a broader shift across public real estate companies as investors rewarded exposure to logistics assets fueled by e-commerce, supply chain reconfiguration and domestic manufacturing growth.

The agreement includes a 40-day go-shop period that runs through Aug. 28, allowing LXP to solicit competing bids. If no superior proposal emerges, the REIT will suspend its common dividend until the transaction closes or is terminated. The merger is not subject to a financing contingency and LXP will be taken private if the deal is finalized.

For Brookfield, the purchase expands an already sizable global real estate platform.

CPP Investments, one of the world’s largest pension funds, has continued increasing its exposure to U.S. industrial real estate. Last year, it formed a joint venture with Dream Industrial Real Estate Investment Trust to acquire up to C$3 billion (approximately $2.2 billion) of industrial real estate across Canada, kicking off with the acquisition of 12 industrial properties from Dream Industrial for C$805 million, spanning Ontario, Quebec and Alberta.

A few years back, activist investor Jonathan Litt’s Land & Buildings Investment Management sent a letter to LXP, expressing interest in acquiring the REIT. The letter put a price on the potential acquisition at $16 per share, or a total of about $4.5 billion, but nothing came of it.