AvalonBay to Buy Equity Residential in $70 Billion All-Stock Deal
The merger of equals creates Vivmark Residential, a rental housing giant aimed at leveraging scale to drive structurally superior earnings growth.
AvalonBay Communities, Inc. (AVB) agreed to acquire Equity Residential (EQR) in an all-stock merger of equals valued at an enterprise value of approximately $70 billion. The transaction results in the creation of a new entity, Vivmark Residential (VMRK), which is expected to begin trading on the New York Stock Exchange on August 18, 2026.
Under the terms of the agreement, each share of AvalonBay common stock outstanding immediately prior to the merger converted into the right to receive 2.793 shares of the combined company. Following the close, former AvalonBay stockholders will own approximately 51% and Equity Residential shareholders will own approximately 49% of the combined company on a fully diluted basis.
The merger creates a fundamentally stronger organization with the scale and capabilities to redefine leadership in rental housing and enhance the resident experience. "Vivmark represents a transformational opportunity to redefine the rental housing industry, utilizing our scale and capabilities to deliver superior value for shareholders," said Stephen Sterrett, Vivmark’s Chairman.
Vivmark Residential enters the market as one of the largest real estate companies in the U.S., with an equity market capitalization of approximately $51 billion and a portfolio of more than 184,000 rental apartments. The company also holds over 11,100 apartments under construction, representing approximately $4.4 billion in active development.
The combined company intends to utilize a "self-reinforcing performance cycle" to lower its cost of capital and fund future development. This strategy relies on a proprietary data ecosystem containing more than 60 million customer insight data points and 4 million lease transaction data points to optimize investment outcomes.
Vivmark expects to deliver an initial annualized dividend of $2.81 a share. The company also expects combined annual cash flow and leverage-neutral self-funding capacity of more than $2 billion for 2026. To support its commitment to affordable housing, the company is committing $1.5 million to expand resident services in the Washington, D.C. metro region and intends to establish an affordable housing bridge loan facility.