AvalonBay Communities and Equity Residential edge toward a merger that could reshape the U.S. apartment market. Sources say talks are close to a deal that would merge the two largest REITs by value. A joint announcement could appear Thursday, though no commitment yet. The move follows a trend of consolidation as landlords wrestle with stalled rent growth in recent years.

AvalonBay, valued at about $26 billion, owns roughly 100,000 units across 300 complexes in 11 states, including New York and California. Equity Residential, worth $24.8 billion, manages more than 85,000 apartments in six states such as Texas and Georgia, with a strong presence in New York and California. Combining assets would create a portfolio of over 185,000 units nationwide for investors and.

Deal timing remains uncertain, with talks subject to change and no binding agreement yet. If completed, the merger would position the new entity as the largest apartment REIT, potentially shifting capital flows and competitive dynamics across the industry. Market watchers will monitor regulatory reviews and shareholder votes that could confirm or derail the transaction in the next week or month.