GO Residential Real Estate Investment Trust (GO.U) M&A announcement summary

Deal rationale and strategic fit

• Creates a premier residential REIT with 37 properties and over 13,300 suites across eight U.S. markets, combining trophy NYC assets with high-growth Sunbelt communities, and marks the culmination of a multi-year repositioning to a pure-play residential platform.

• Establishes the second-largest publicly traded residential REIT in Canada and seventh largest in the U.S., enhancing scale, geographic diversification, and organizational capabilities.

• Diversifies portfolio by adding 23 high-quality Sunbelt properties, reducing New York City concentration and enhancing asset quality.

• Offers H&R unitholders immediate value, a majority stake in the combined entity, and ongoing participation in future upside.

• Enhances earnings consistency, growth opportunities, and investor appeal through economic cycles and increased scale.

Financial terms and conditions

• H&R unitholders receive $4.28 in cash plus 0.5688 GO REIT units per H&R unit, totaling $12.01 per unit upfront, structured as a tax-deferred rollover for eligible Canadian residents.

• H&R unitholders will own approximately 67% of the combined entity; GO and OpCo unitholders will own about 33%.

• GO will assume about $1.1 billion in property debt (USD) and CAD 550 million in unsecured bonds/debentures.

• The transaction values the combined entity at approximately $6.7 billion in enterprise value.

• Termination fees: H&R pays $102 million if accepting a superior proposal; GO pays $27 million; reverse fee of $136 million if Purchaser fails to fund.

Synergies and expected cost savings

• Approximately $15 million in annualized synergies are projected within 12–18 months post-closing, driven by operational savings, procurement efficiencies, and overhead reductions.

• Synergies to be realized without changes to operational teams, leveraging existing relationships and minimal incremental G&A.

• NOI margins for the Lantower portfolio are expected to rise from mid-50s to low/mid-60s, aligning with public Sunbelt REIT peers.

• Transaction is accretive to FFO and AFFO per unit and reduces pro forma leverage by more than 2x at close.