ACRES Commercial Realty Corp. Announces Agreement to Internalize Management and Acquire ACRES Capital Corp.

Rhea-AI Summary

ACRES Commercial Realty (NYSE: ACR) entered a definitive merger agreement to acquire ACRES Capital Corp. and its manager, internalizing management and converting from an externally-managed REIT to an internally-managed REIT. The all-stock deal issues ~7.5 million ACR shares at fully diluted book value and is expected to close in Q3 2026.

Post-close AUM rises from $2.2B to $4.7B, ACR shares outstanding net increase ~6.3M, and management/employee ownership is expected to exceed 45% of common equity.

Positive

• Assets under management increase from $2.2B to $4.7B
• Transaction paid in ACR common stock at fully diluted book value
• Management and employees expected to own >45% of ACR equity
• Adds recurring third‑party fee income tied to an evergreen fund
• Expected accretive to earnings available for distribution (EAD)

Negative

• Issuance of approximately 7.5M ACR shares increases dilution
• Net increase of ~6.3M shares outstanding post-consolidation

News Market Reaction – ACR

+2.08%

+2.08% Session close to close

In the Apr 30 session, ACR gained 2.08%, reflecting a moderate positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement details ACR’s plan to acquire ACC in an all-stock transaction and internalize its ...

Analysis

This announcement details ACR’s plan to acquire ACC in an all-stock transaction and internalize its management, expanding assets under management from $2.2 billion to an anticipated $4.7 billion. Management and employees are expected to own over 45% of common equity, and the deal is framed as accretive to earnings available for distribution. Investors may track closing progress, updated EAD metrics, and how new third‑party fee income balances dilution from the roughly 7.5 million new shares.

Key Figures

Merger consideration shares: 7.5 million shares Net new shares: 6.3 million shares Current AUM: $2.2 billion +5 more

8 metrics

Merger consideration shares 7.5 million shares ACR common stock issued to ACC stockholders at fully diluted book value

Net new shares 6.3 million shares Net increase in ACR shares outstanding after eliminating ACC-held shares

Current AUM $2.2 billion ACR assets under management before acquiring ACC’s business

Post-merger AUM $4.7 billion Anticipated AUM after acquisition of ACC’s asset management business

Management equity stake Over 45% Expected management and employee ownership of ACR common equity at closing

CRE whole loans $1.8 billion CRE whole loans in portfolio at December 31, 2025

Loan coupon 7.32% Weighted average coupon on CRE whole loan portfolio at December 31, 2025

Portfolio financing $1.34 billion Portfolio financing across bank, insurance and warehouse facilities

Historical Context

5 past events · Latest: Apr 15 (Neutral)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Apr 15	Earnings date notice	Neutral	+0.1%	Announcement of Q1 2026 results release and investor call timing.
Mar 19	Preferred dividends	Positive	+1.0%	Declaration of quarterly cash dividends on Series C and Series D preferred.
Mar 04	Earnings results	Neutral	+1.1%	Q4 2025 results with GAAP net loss but strong loan originations and CLO plans.
Feb 18	Earnings date notice	Neutral	-0.3%	Scheduling of Q4 2025 earnings release and related conference call.
Jan 20	CLO financing	Positive	+1.6%	Pricing of $879.5M notes to finance about $1.0B of CRE loans.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent news events have generally seen small, positive price reactions, especially around financing and earnings-related updates, suggesting the stock tends to respond constructively to operational and capital markets milestones.

Recent Company History

Over the past few months, ACR highlighted several financing and earnings milestones. A $1.0 billion CRE CLO pricing and a loan origination ramp were followed by modestly positive price moves. Quarterly and annual earnings included a $3.0 million GAAP net loss in Q4 2025 but also strong origination activity. Routine items like earnings-date announcements and preferred dividends produced small reactions. Today’s acquisition and internalization news follows this pattern of strategic balance-sheet and fee-income developments.

Key Terms

reit, definitive merger agreement, all-stock transaction, earnings available for distribution, +2 more

6 terms

reit financial

"transition from an externally-managed REIT to an internally-managed REIT (the "Internalization")."

A real estate investment trust (REIT) is a company that owns, operates, or finances income-producing real estate, like shopping centers, apartments, or office buildings. For investors, REITs offer a way to invest in real estate without having to buy property directly, often providing regular income through dividends. They function like a mutual fund for real estate, making it easier for people to add property investments to their portfolio.

definitive merger agreement regulatory

"they have entered into a definitive merger agreement (the "Merger Agreement"), pursuant to which ACR will acquire ACC"

A definitive merger agreement is the final, signed contract that sets the exact terms for two companies to combine, including the price, payment method, conditions to closing, and what happens if the deal falls apart. For investors it matters because it turns a tentative plan into a legally binding arrangement—like signing a mortgage rather than agreeing to look at a house—so it often has an immediate effect on share prices and clarifies the risks from regulatory approval, financing or breakup fees.

all-stock transaction financial

"pursuant to which ACR will acquire ACC in an all-stock transaction (the "Merger")."

An all-stock transaction is a deal where one company acquires another using only its own shares instead of cash or other assets. For investors, this means exchanging ownership stakes rather than cash, which can affect the value and control of the companies involved. It often signals a focus on growth and can influence the stock prices of both companies.

earnings available for distribution financial

"supporting greater earnings available for distribution ("EAD") stability and enhancing long-term"

Earnings available for distribution are the portion of a company’s profit that remains after paying taxes, meeting legal or contractual reserves, and covering any required debt or operating obligations — essentially the cash the business can legally and practically give to shareholders or unitholders. Investors watch this number because it shows how much income a company can return as dividends or distributions, similar to the money left in a household account after paying bills and savings goals.

evergreen fund financial

"third-party fee-related income stream tied to an evergreen fund, which can reduce sensitivity"

An evergreen fund is a type of investment fund that continuously accepts new investments and distributes returns without a fixed end date. Think of it like a garden that keeps growing and renewing itself, allowing investors to add or withdraw money over time. This structure provides ongoing access to investments, making it flexible for investors who want steady exposure to a particular set of assets without the pressure of a fixed timeline.

schedule 13g/a regulatory

"The Vanguard Group filed Amendment No. 1 to a Schedule 13G/A reporting beneficial ownership"

A Schedule 13G/A is an amended public filing with the U.S. securities regulator that updates a previous Schedule 13G, disclosing when an individual or group holds a substantial (typically over 5%) stake in a company and is claiming a passive, non‑controlling intent. Investors monitor these updates because rising or falling holdings can signal changing confidence, potential future moves, or shifts in voting power — like watching a public ledger where large shareholders quietly adjust their positions.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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~Enhanced Earnings Profile –Significant Third-Party Revenue Streams~
~Alignment of Interest and Consideration in Form of ACR Shares at Fully Diluted Book Value~
~Continuity of Management Team~

UNIONDALE, N.Y., April 30, 2026 /PRNewswire/ -- ACRES Commercial Realty Corp. (NYSE: ACR) ("ACR" or the "Company") and ACRES Capital Corp. ("ACC") announced today that they have entered into a definitive merger agreement (the "Merger Agreement"), pursuant to which ACR will acquire ACC in an all-stock transaction (the "Merger"). In connection with the Merger, ACR will acquire ACRES Capital, LLC, its external manager (the "Manager") and an indirect wholly-owned subsidiary of ACC, and transition from an externally-managed REIT to an internally-managed REIT (the "Internalization").

The Merger Agreement and the terms of the Internalization were negotiated and unanimously approved and recommended by a Special Committee of the Board of Directors of ACR, composed of independent directors (the "ACR Special Committee"), and approved by ACR's Board of Directors. The Merger and Internalization are subject to certain closing conditions, including the approval of ACR's stockholders of the issuance of ACR's common stock as merger consideration, and is expected to close during the third quarter of 2026. As a result of the Merger and Internalization, ACR expects to directly employ its existing management team and all other employees of the Manager.

Upon closing of the Merger and Internalization, the Company will issue approximately 7.5 million shares of ACR's common stock to ACC stockholders as merger consideration, priced at ACR's fully diluted book value per share as of December 31, 2025, and will terminate the existing Management Agreement. Following closing, the net increase in ACR shares outstanding is expected to be approximately 6.3 million shares after giving effect to the elimination of ACR shares held by ACC in consolidation.

The Company has posted a presentation providing additional information regarding the Merger and Internalization under the Investor Relations section of its website at https://www.acresreit.com/investor-overview.

Anticipated Key Benefits of the Merger and Internalization

The Merger and Internalization are expected to create operational and financial benefits for ACR post-closing, including:

• Expanding ACR's assets under management from $2.2 billion to an anticipated $4.7 billion through the acquisition of ACC's asset management business;
• Internalizing management to align stakeholder interests and eliminate dependence on an external manager;
• Aligning management's interests with stockholders with the ACR management team and employees expected to own over 45% of ACR common equity at closing;
• Consideration paid entirely in ACR common stock issued at fully diluted book value;
• Adding a recurring, third-party fee-related income stream tied to an evergreen fund, which can reduce sensitivity to capital markets volatility;
• Diversifying earnings, supporting greater earnings available for distribution ("EAD") stability and enhancing long-term earnings growth potential; and
• Expected to be accretive to EAD and support a sustainable common dividend profile

Continued Strong Leadership

The Company will continue to be managed by its existing senior leadership team, with Andrew Fentress serving as Chairman of the Board and as a Managing Director and Mark Fogel serving as President. In addition, the Company intends to retain employees of the Manager who currently serve in key roles at ACR, including, but not limited to, those who support ACR's asset management, legal, accounting, tax and treasury operations.

Advisors

The ACR Special Committee was advised by BTIG, LLC as its exclusive financial advisor, Hunton Andrews Kurth LLP as its legal counsel and Meridian Compensation Partners, LLC as its compensation consultant.

About ACRES Commercial Realty Corp. and Acres Capital, LLC

ACRES Commercial Realty Corp. is a real estate investment trust that is primarily focused on originating, holding and managing commercial real estate mortgage loans and may hold equity investments in commercial real estate properties through direct ownership and joint ventures. The Company is currently externally managed by ACRES Capital, LLC, a subsidiary of ACRES Capital Corp., a private commercial real estate lender exclusively dedicated to nationwide middle market CRE lending with a focus on multifamily, student housing, hospitality, industrial and office property in top U.S. markets. For more information, please visit the Company's website at www.acresreit.com or contact investor relations at IR@acresreit.com.

About ACRES Capital Corp.

ACRES Capital Corp. is a private commercial real estate lender and U.S. Securities and Exchange Commission-registered investment adviser that originates, structures, and manages real estate debt investments. Headquartered in New York with offices throughout the US, ACC focuses on Class A multifamily, student housing, hospitality, office, and industrial lending across major U.S. markets.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as "may," "trend," "will," "continue," "expect," "intend," "anticipate," "estimate," "believe," "look forward" or other similar words or terms. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. Factors that can affect future results are discussed in the documents filed by the Company from time to time with U.S. Securities and Exchange Commission (the "SEC").  These risks and uncertainties include, but are not limited to, risks and uncertainties relating to satisfaction of the Merger closing conditions in a timely manner, if at all, the Company's ability to successfully close the Internalization, to manage the transition to self-management and the ability to achieve expected cost savings or other benefits of the Internalization and the timing thereof; unanticipated expenditures relating to or liabilities arising from the internalization; litigation or regulatory issues relating to the Internalization; the impact of the Internalization on the Company's common stock dividend, and the impact of the Internalization on relationships with, and potential difficulties retaining, the Company's executive officers, employees and directors on a go-forward basis. The foregoing list of factors is not exhaustive. Accordingly, you should not place undue reliance on any forward-looking statements contained herein. For a discussion of some of the risks and important factors that could affect such forward-looking statements, please refer to the Company's most recent annual and quarterly reports and other filings filed with the SEC, which are available on the Company's website (www.acresreit.com). The Company undertakes no obligation to update or revise any forward-looking statement to reflect new or changing information or events after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.

Participants in the Proxy Solicitation

This press release relates to the proposed Internalization. In connection with the proposed internalization transaction, the Company will file relevant materials with the SEC, including a proxy statement on Schedule 14A (the "Proxy Statement"). This communication is not a substitute for the Proxy Statement or for any other document that the Company may file with the SEC and send to its stockholders in connection with the proposed Internalization. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders will be able to obtain free copies of the Proxy Statement and other documents filed by the Company with the SEC through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed by the Company with the SEC will be available free of charge on the Company's website at www.acresreit.com, or by contacting the Company's investor relations at IR@acresreit.com

The Company and its directors and certain of its executive officers may be considered participants in the solicitation of proxies with respect to the proposed transactions under the rules of the SEC. Information about the directors and executive officers of the Company is set forth in its proxy statement for its 2025 annual meeting of stockholders, which was filed with the SEC on April 11, 2025 and other filings filed with the SEC. Additional information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will also be included in the Proxy Statement and other relevant materials to be filed with the SEC when they become available.

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SOURCE ACRES Commercial Realty Corp.

FAQ

What is the merger between ACRES Commercial Realty (ACR) and ACRES Capital Corp.?

The merger is an all-stock acquisition where ACR will acquire ACRES Capital and its manager. According to the company, ACR will issue approximately 7.5 million shares at fully diluted book value and expects closing in Q3 2026.

How does the ACR internalization change the company's management structure?

ACR will convert from an externally-managed REIT to an internally-managed REIT, directly employing its management team. According to the company, employees of the manager are expected to join ACR and retain senior leadership continuity.

What is the impact of the deal on ACR's assets under management (AUM)?

The transaction increases ACR's AUM from $2.2 billion to an anticipated $4.7 billion. According to the company, this reflects the acquisition of ACC's asset management business and related assets under management.

How will shareholders be affected by the ACR share issuance in the merger?

ACR will issue ~7.5 million shares as merger consideration, yielding a net increase of about 6.3 million shares outstanding. According to the company, consideration is priced at ACR's fully diluted book value per share as of 12/31/2025.

Will the merger affect ACR's dividends or earnings profile?

The company expects the deal to be accretive to earnings available for distribution and to support a sustainable common dividend profile. According to the company, added fee income and diversification should help stabilize EAD.