American Realty Capital Properties Inc. (ARCP) said Tuesday it has agreed to buy fellow real estate investment trust CapLease in a deal worth $2.2 billion, including debt.

The acquisition would make ARCP—which has headquarters in New York, but is incorporated in Maryland—the country’s third-largest REIT in the net-lease sector, where tenants shoulder most of a property’s operating costs. In announcing the deal, ARCP said the acquisition would increase the number of properties it owns by 70, giving a total of 800 properties.

The deal calls for ARCP to pay $8.50 in cash for each share of CapLease, a nearly 20 percent premium over the target’s Friday closing price. New York–based CapLease has $1.2 billion of outstanding debt, of which ARCP says it will assume roughly $580 million while repaying the rest. The deal is expected to close in the third quarter of the year, pending the approval of CapLease shareholders. The agreement includes a "go-shop" period that ends July 7 during which CapLease is free to solicit alternative proposals.

Earlier this year, ARCP made a bid to become the country’s largest publicly traded REIT with a failed offer of $9 billion—including assumed debt—to buy Cole Credit Property Trust III Inc. Phoenix-based Cole Credit spurned ARCP’s offer in favor of a deal to buy its own management company, which led ARCP to withdraw its bid in April.

Proskauer Rose is advising ARCP on the CapLease purchase. The Am Law Daily reported in March that Proskauer and Weil, Gotshal & Manges were advising ARCP on its bid for Cole Credit.

Leading Proskauer’s team on the CapLease deal are corporate partner Peter Fass, cohead of the firm’s real estate capital markets group, and M&A partner Daniel Ganitsky, both of whom are based in New York. Corporate partner Andrew Bettwy, employee benefits partner Ira Bogner, tax partner Les Loffman, and corporate associate Michael Ellis are also advising, along with partner Steven Lichtenfeld, who coheads Proskauer’s real estate capital markets group.

Baltimore-based J.W. Thompson Webb, of Miles & Stockbridge, is serving as ARCP’s Maryland corporate counsel in connection with the deal.

CapLease,meanwhile, has turned to a Hunton & Williams team led by M&A partners Steven Haas and G. Roth Kehoe II. Tax partner Mark Van Deusen is also advising, with help from associates Wyatt Deal and Christopher Mangin, Jr.

Venable is serving as Maryland counsel to CapLease, according to the deal announcement. A Venable spokesman did not respond to The Am Law Daily‘s request for information regarding the firm’s deal team.