Starwood Property Trust to Acquire $2.2 Billion Net Lease Platform

Core Viewpoint - Starwood Property Trust has announced a definitive agreement to acquire Fundamental Income Properties for approximately $2.2 billion, enhancing its position in the net lease real estate market and expected to be accretive to distributable earnings [1][6][7]. Acquisition Details - The acquisition involves a portfolio of 467 properties totaling 12 million square feet across 44 states, with a weighted average lease term of 17 years and average annual rent escalations of 2.2% [3][6]. - The transaction will include assuming $1.3 billion in existing financing facilities from Fundamental, including $0.9 billion in asset-backed security debt [7]. Strategic Benefits - The acquisition solidifies Starwood's position as a leading diversified REIT and provides a growth engine in the global net lease real estate market [6][12]. - The integration of Fundamental's experienced management team is expected to enhance origination capabilities and access to proprietary credit investment opportunities [12]. Financial Performance - Preliminary results for Q2 2025 indicate expected earnings per diluted share in the range of $0.36 to $0.38, with distributable earnings per diluted share estimated between $0.42 and $0.44 [9][10]. - The company estimates its book value as of June 30, 2025, to be approximately $6.42 billion, or $18.78 to $18.80 per share [10]. Dividend Declaration - The Board of Directors has declared a dividend of $0.48 per share for Q3 2025, payable on October 15, 2025 [17].