Elme Communities to Liquidate Amid Portfolio Sale to Cortland

Elme Communities has announced a planned liquidation and sale of a portfolio of 19 assets to Cortland. The company has outlined distributions of $17.58-$18.50 per share for the period. The sale is expected to close at an undisclosed date, with management citing the deal as a strategic move to maximize shareholder value.

Elme Communities (ELME), a value-oriented multifamily owner and operator, has announced a strategic move to maximize shareholder value through the planned liquidation and sale of a portfolio of 19 assets to Cortland, an Atlanta-based multifamily real estate investment, development, and management company. The company has outlined a distribution of $17.58-$18.50 per share for the period, with the sale expected to close at an undisclosed date in the fourth quarter of 2025.

The announcement follows a comprehensive strategic alternatives review conducted by the Elme Board of Trustees, which led to the selection of Cortland as the preferred buyer. The portfolio sale transaction, valued at $1.6 billion in cash subject to adjustments, is not contingent on Cortland securing financing. The transaction is expected to close following the receipt of shareholder approval and satisfaction of other customary closing conditions.

Elme Communities plans to distribute a total of $14.50-$14.82 per share to shareholders upon the completion of the Cortland portfolio sale, with an additional $2.90-$3.50 per share expected from the sale of the remaining 9 assets and Watergate 600. The company expects to complete all asset sales within the next 12 months, with the marketing and sale process for the remaining assets set to begin in the third quarter of 2025.

Management has expressed confidence in achieving favorable executions for the remaining asset sales, with the goal of maximizing shareholder value through the transition and liquidation process. The company has also highlighted the importance of thorough review processes and the commitment to transparency throughout the process.

The announcement marks a significant shift in Elme Communities' strategic focus, moving from ongoing operations and growth initiatives to a definitive portfolio sale and company liquidation plan. The company's management and board have emphasized the importance of maximizing shareholder value through the transaction and liquidation process, with a focus on achieving favorable sale outcomes and minimizing costs.

References:
[1] https://seekingalpha.com/news/4480960-elme-communities-outlines-17_58-18_50-per-share-distributions-through-planned-liquidation
[2] https://ir.elmecommunities.com/news-events/press-releases/detail/372/elme-communities-concludes-strategic-alternatives-review