What happened

Parkway Inc. (NYSE:PKY#), a real estate investment trust, or REIT, that invests in Houston-area office properties, announced on Friday that it would be acquired by Canada Pension Plan Investment Board (CPPIB) for $1.2 billion. At 11 a.m. EDT, shortly after the announcement, shares were up by 12.4% to about $22.90.

So what

The Canada Pension Plan Investment Board's offer for Parkway is worth $23.05 per share, which consists of $19.05 in cash at closing, plus a $4 special dividend to be paid prior to the closing of the deal. Parkway's board has approved the transaction, and the REIT's major shareholders have indicated that they intend to vote in favor of the deal as well.

The outisde of an office building.

Image source: Getty Images. (Note: Building pictured is not part of Parkway's property portfolio)

Now what

Generally speaking, after a takeover or buyout offer is made and accepted, the market's reaction tells us how likely the deal is to actually go through. For example, if a takeover offer is made at a significant premium and the stock's price barely moves, the market isn't putting a whole lot of faith in the deal being finalized.

In this case, however, the market's reaction is within pennies of the offer price, which means investors are quite confident that the takeover will be completed during the fourth quarter, as expected.

For Parkway's investors, this means that they may need to find another place to invest. Empire State Realty Trust (NYSE:ESRT) is my favorite office-oriented REIT. The company owns the Empire State Building and several other high-profile properties in the New York City area, and sees significant growth potential. Cousins Properties (NYSE:CUZ) is another good example. This office REIT was founded in 1958 and invests in top-quality office space in high-growth markets such as Atlanta, Charlotte, and Orlando, and does so with a more attractive balance sheet than most of its peers.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.