Real Estate

SmartRent Signs $2.2B Merger Deal With Fifth Wall SPAC

Once closed, the merger would mark one of the biggest deals between a proptech firm and a special-purpose acquisition company to date.

Smart home technology company Inc. announced on Thursday its intentions to go public via a merger with special-purpose acquisition company (SPAC) Fifth Wall Acquisition Corp.

The merger values SmartRent, whose products service approximately 185,000 apartments in the U.S. and Canada, at $2.2 billion. In February, Fifth Wall Acquisition Corp. raised about $345 million in its initial public offering (IPO), which was sponsored by venture-capital firm Fifth Wall Ventures. The firm had also invested in SmartRent back in 2020 through one of its funds.

Earlier this week, Fifth Wall Ventures also announced the debut of its third SPAC, Fifth Wall Acquisition III.

In addition, a number of big-name U.S.-based apartment-building owners and developers have pledged a $155 million PIPE (Private Investment in Public Equity) to SmartRent, the company said, including Blackstone Group Inc., Starwood Capital Group LLC, Lennar Corp. and Invitation Homes Inc.

The deal will need to undergo a regulatory review and shareholder vote prior to closing, but once closed, it would be one of the biggest deals between a proptech firm and a SPAC to date.

SmartRent Founder and CEO Lucas Haldeman | Credit: SmartRent

Lucas Haldeman, former chief technology officer of Colony Starwood Homes (later Starwood Waypoint Homes, which merged into Invitation Homes, one of the largest owners of single-family rental homes), founded SmartRent in Scottsdale, Arizona, in 2017. The company’s goal was to equip rental homes with the same smart home features that many single-family homeowners enjoy.

The company’s technology allows landlords to monitor and control thermostats, utilities, security and plumbing from either a computer or a smartphone, and landlords can also equip tenants with apps to support these home functions, if tenants desire them.

With the influx of funding, SmartRent will expand its technology offerings to new global markets.

“We’ve already started working on pilots in western Europe,” Haldeman told the Wall Street Journal. “We’re a couple months away from deploying in Asia.”

Some of Fifth Wall’s venture capital funds investors include big residential owners in Europe and Asia, which has allowed SmartRent to make inroads in those markets. Haldeman told the Journal he anticipates the company’s technology will span across over 300,000 apartment units by the end of the year.

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