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**City Office REIT to Be Acquired by MCME Carell in $1.1 Billion Transaction**
City Office REIT has announced a definitive merger agreement to be acquired by MCME Carell in a transaction valued at approximately $1.1 billion, including debt.
Following the completion of the deal, the Vancouver-based real estate investment trust will become a privately held company, and its shares will be delisted from the New York Stock Exchange.
City Office REIT is an internally managed company focused on acquiring, owning, and operating office properties in U.S. Sunbelt markets. The company holds a controlling interest in approximately 5.4 million square feet of office assets.
MCME Carell, based in Grand Prairie, Texas, is an affiliate of Elliott Investment Management and Morning Calm Management, headquartered in West Palm Beach and Boca Raton, Florida, respectively.
Under the agreement, MCME Carell Holdings LP and MCME Carell Holdings LLP will acquire all issued and outstanding shares of City Office REIT—excluding those they already own—for $7.00 per share in cash. This purchase price represents a 26% premium over City Office’s closing share price prior to the announcement, and a 39% premium over its 90-day volume-weighted average share price.
Completion of the transaction is subject to certain conditions, including shareholder approval, the successful sale of City Office’s Phoenix portfolio, and the assumption or repayment of existing debt. Shareholders holding the company’s 6.625% Series A cumulative preferred stock will receive $25 per share in cash, along with accrued and unpaid distributions.
“After conducting an extensive process to explore potential strategic alternatives, we are pleased to have reached an agreement with MCME Carell,” said James Farrar, Chief Executive Officer of City Office. “In light of a challenging environment for the office sector, this transaction delivers immediate and significant value to our shareholders.”
The transaction, which has received unanimous approval from the City Office board of directors, is expected to close in the fourth quarter of 2025. The deal is not contingent on financing.
“We are pleased to have reached an agreement with City Office to effectuate this transaction,” said Mukang Cho, CEO of Morning Calm. “This opportunity underscores our partnership’s continued belief in the recovery of the office sector and our interest in acquiring high-quality office assets in strong growth markets.”
City Office REIT will pay its second-quarter dividend on July 24, 2025. However, future quarterly dividends on common stock have been suspended. Dividends on Series A preferred stock will continue as scheduled.
The company will not host a conference call or webcast for its second-quarter financial results but expects to release its earnings on July 31, 2025.
Raymond James & Associates and Jones Lang LaSalle Securities served as financial advisors to City Office. Legal counsel was provided by DLA Piper LLP (M&A) and Hogan Lovells LLP (corporate). Eastdil Secured acted as advisor to the buyer, with legal representation from Gibson Dunn & Crutcher LLP.
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