Blackstone to buy Preferred Apartment Communities in $5.8 bln deal

Preferred Apartment Communities Inc said on Wednesday a Blackstone Inc unit would buy it in a $5.8 billion deal, as the world’s biggest alternate asset manager ramps up investments in the red-hot U.S. housing sector.

Blackstone Real Estate Income Trust’s (BREIT) all-cash offer of $25 per share is nearly 40% higher than Preferred Apartment’s stock close on Feb. 9, a day before media reports on the company exploring strategic options including a sale.

The real estate investment trust’s shares shot up 7% to $25.04 before the bell following the news.

Blackstone’s offer comes at a time when a strong economic recovery, ultra-low interest rates and continued demand for bigger homes have driven up home prices in the United States. The private equity giant also bought Home Partners of America in a $6 billion deal last year.