Starwood Bids Against Sam Zell for Industrial Giant Monmouth Real Estate


Sam Zell’s push into the red-hot industrial market might not be a done deal.

Barry Sternlicht’s Starwood Capital Group put in an unsolicited takeover bid for industrial real estate investment trust (REIT) Monmouth Real Estate Investment Corporation that could derail its original plans to be acquired by Zell’s Equity Commonwealth, Bloomberg reported.

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A spokesperson for Starwood declined to comment and a representative for Equity did not immediately respond to a request for comment. Monmouth announced the takeover bid on Monday, but did not name Starwood as the buyer.

The all-cash offer calls for a complete takeover of Monmouth — which owns 24.5 million square feet in 31 states — for $18.70 a share, according to Monmouth.

Monmouth said it was “evaluating” Starwood’s proposal and “has not made any determination as to what action to take.” It would be on the hook for a $62.2 million breakup fee if it backs out of the Equity acquisition.

In May, Equity announced that it agreed to buy a 65 percent stake in the New Jersey-based REIT in an all-stock deal valued at about $3.4 billion, which was expected to close in the second half of this year.

The deal calls for Monmouth investors to get .67 shares of an Equity share for each Monmouth share they own, which closed at about $18.10 on Monday, according to Bloomberg. Monmouth’s shares jumped to around $19 after the takeover bid was announced.

And, not everybody was thrilled with Zell’s offer. Monmouth shareholder Blackwells Capital — which unsuccessfully tried to acquire Monmouth itself — previously called Equity’s offer “wholly inadequate,” Bloomberg reported.

Nicholas Rizzi can be reached at