Lessen, the tech-enabled, end-to-end solution for outsourced real estate property services, announced a strategic acquisition of SMS Assist, a facilities maintenance technology company. The two companies will serve a national footprint of approximately 250,000 residential and commercial properties and facilitate approximately 2.5 million repair and maintenance orders per year in tandem with bolstering a broader range of property services.
“Lessen recognized early on the opportunity to provide an enterprise-level solution that solved the real estate industry’s long-tenured property services pain points,” said Jay McKee, founder and CEO, Lessen. “This deal demonstrates the increasing demand within the under-penetrated, $330 billion addressable North American property services market for a unified, extensible delivery platform that provides transparency, efficiency and data-driven insights for the entire real estate ecosystem including investors, owners, managers and service providers.”
The new, combined technology platform will allow the many service providers — from contractors, painters, plumbers to electricians and more — to act as one, performing work at a national level not previously possible. This work will be overseen and inspected for quality by Lessen’s in-house project managers. The combined solution will help owners overcome skilled labor shortages, while simultaneously reducing administrative burden, providing efficiency and real-time project updates.
The transaction consists of both cash and stock, with 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 over $2 billion in enterprise value.
Following the close of the transaction, Lessen’s McKee will continue to lead the newly combined company as CEO and serve as chairman of the board of directors.
“The acquisition unlocks significant value through synergies building on a long operating history and will show we are well positioned together with Jay at the helm, leading from a consistent track record of growth,” said Michael Rothman, founder and chairman of SMS Assist.
Evercore acted as the exclusive financial advisor, and Fenwick & West LLP acted as legal counsel to Lessen. J.P. Morgan Securities LLC acted as financial advisor and Katten Muchin Rosenman LLP as well as Skadden Arps Slate Meagher & Flom LLP acted as legal advisors to SMS Assist.
