Cottonwood Communities Closes on $500M RealSource Properties Acquisition
Cottonwood Communities, Inc., a publicly registered non-traded real estate investment trust focused on multifamily real estate investments, has finalized the acquisition of RealSource Properties in a private stock-for-stock and unit-for-unit merger transaction valued at approximately $500 million. RealSources’ multifamily portfolio comprises 11 properties consisting of 3,565 units.
The acquisition, first reported by AltsWire in June 2025, increases the gross asset value of Cottonwood Communities’ portfolio to $2.6 billion, with 48 multifamily communities and 11,037 units across 13 states, expanding its footprint into Ohio, Colorado and Kentucky, and strengthening its presence in Texas, North Carolina, and Georgia.
“The completion of this acquisition signals a pivot to an offensive posture for Cottonwood Communities ushering in a new phase of growth. Building on this momentum and the expanded scale of our platform, Cottonwood is well poised to advance our strategic priorities heading into 2026,” said Daniel Shaeffer, chief executive officer of Cottonwood Communities. “We are grateful for the continued trust of our shareholders and remain committed to delivering durable value, systematic growth, and long-term performance.”
Additionally, as part of the broader transaction, Cottonwood Communities assumed third-party property management of five other properties.
“We are proud of what RealSource has achieved and are confident that Cottonwood Communities’ will build on this foundation. While working together throughout this process, we have observed firsthand the depth of Cottonwood’s multifamily operations and investment experience and are confident they are well positioned to create lasting value and provide tax-efficient benefits for our equity holders,” said Nate Hanks, CEO of RealSource Properties.
In connection with this acquisition, Cottonwood said its executive officers intend to make an aggregate investment of $3 million in Cottonwood Communities, divided equally between Class I common stock or common partnership units, and Series A convertible preferred stock. Further, Cottonwood Communities’ adviser has reduced its asset management fee by 16.7% from 1.5% of net asset value to 1.25% of NAV, effective as of the closing of the transaction.
The company stated that the steps affirm its leadership’s conviction and confidence in Cottonwood’s trajectory and commitment to growth and performance.
In August of this year, AltsWire reported on the REIT’s new Delaware statutory trust program, which launched that quarter.
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