Sentinel To Acquire America First for $532M

OMAHA-Sentinel Omaha LLC, an affiliate of Sentinel Real Estate Corp., has acquired America First Apartment Investors Inc., a local REIT, for about $532 million, including the assumption of outstanding debt and excluding transaction costs. Sentinel will acquire the outstanding shares of America First, which owns 32 multifamily properties and one small office facility, for $25.30 per share in cash. The company's stock was trading at $25 at noon today.

The America First board of directors has unanimously approved the merger and has recommended that shareholders vote for the transaction. The deal is expected to close in September, Jack Cassidy, president and CEO of America First, tells GlobeSt.com.

The REIT had started out as a partnership, he says, but was restructured as a trust in 2001 "once it became a little active." He says a sale was not the plan from the start, but "as a public company, we wanted to make sure our shareholders know that we would continue to grow. We felt what has happened in the marketplace today, significant values are being paid for real estate, we wanted to pursue all strategic options." A proxy statement should be filed this week, he says.

The New York City-based Sentinel currently manages about $5 billion in real estate assets and is among the largest holders of apartment properties in the US. "I know that part of their interest was in gaining a number of apartment communities in areas they already own," Cassidy says. The America First portfolio includes apartments in mostly Southeast and Midwest states, such as the Greenhouse, a 126-unit mid-rise at 900 Farnam St. in Downtown Omaha, purchased in 2006. The company also owns a small office property in Florida, an "isolated situation," Cassidy says.

Cassidy, with banking and investment experience, says that after the purchase he'll be looking for another property company to join or manage. "I'm not quite ready to retire," he says.