Biggest Proptech Deal

It’s no secret that VCs and principals expect 2023 to be a year of mergers and acquisitions in the proptech sector. The biggest evidence yet comes via a deal that its parties say totals $950 million, including $500 million in new debt and equity. Also, Brooklyn’s office market has not exactly fully recovered from the effects of COVID-19 — but recent leasing figures show it sure is getting there.

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— Tom Acitelli, Co-Deputy Editor

Lessen Acquires SMS Assist in Largest Proptech Acquisition To Date

Lessen, which facilitates outsourced real estate property services, announced Thursday that it has acquired SMS Assist, an industry-leading facilities maintenance technology company, in a $950 million deal. The deal is the largest merger in proptech history, according to the companies. The transaction consists of cash and stock, with Scottsdale, Ariz.-based Lessen raising approximately $500 million in combined new debt and equity, in addition to SMS Assist stockholders exchanging a portion of SMS stock for Lessen stock, resulting in an increased combined company valuation of more than $2 billion in enterprise value. Debt and equity investors who backed this transaction include Monroe Capital, V?rde Partners and Koch Real Estate Investments. Additionally, clients who invested in the deal with Lessen include Invitation Homes and American Homes 4 Rent, among others.

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Brooklyn Office Leasing Spikes 91 Percent Between Third and Fourth Quarter

Brooklyn office leasing in the fourth quarter of 2022 was 30 percent above the borough’s quarterly average for the last five years and 91 percent higher than the previous quarter, according to a new report from CBRE. But it’s still no Manhattan. Only 404,000 square feet of space in Brooklyn was leased in the last three months of 2022, mostly in Downtown Brooklyn, compared to Manhattan’s 5.2 million square feet leased over the same period.

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