Shearman & Sterling advised BMO Capital Markets and CIBC, as co-lead underwriters, in connection with the initial public offering of Milestone Apartments Real Estate Investment Trust. The IPO raised gross proceeds of $200 million.

This innovative transaction, devised principally by the firm, represented the first-ever IPO of a US real estate investment trust (REIT) on a non-US exchange by a non-US entity. Specifically, this REIT IPO used an umbrella partnership (UPREIT) structure, through an issuer that also was legally organized as a Canadian REIT, to go public on the Toronto Stock Exchange (TSX). Using this UPREIT structure, Milestone Multifamily Investors L.P., a US-based operating partnership, was able to go public through a REIT structure that was attractive to Canadian investors, while a number of the prior investors were able to retain an interest in the operating partnership. The operating partnership indirectly owns and operates a portfolio of 52 multifamily properties in the US.

By enabling the US REIT to be organized as a Canadian entity listed primarily on the TSX, the structure provides an alternative vehicle for US REITs, which continue to see strong demand in the US equity markets, to access Canadian investors also seeking real estate, high-yielding equity investments.

The Shearman & Sterling team included partners Laurence Crouch (Palo Alto-Tax), Malcolm Montgomery (New York-Real Estate), Roger Baneman(New York-Tax), Robert Evans III (New York-Capital Markets), Craig Gibian(Washington, DC-Tax), Kenneth Laverriere (New York-Executive Compensation & Employee Benefits), and Don J. Lonczak (Washington, DC-Tax); counsel Sharon Lippett (New York-Executive Compensation & Employee Benefits) and Eileen O’Pray (Palo Alto-Tax); and associates Steven Blau (New York-Financial Institutions Advisory & Financial Regulatory), Jocelyn Bush (New York-Real Estate), Jamal Al-Haj (New York-Corporate Group), Anil Kalia (Palo Alto-Tax), Laura Mulry (New York-Real Estate/Environmental), and Eric Naftel (Palo Alto-Tax).


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