All eyes on Blackstone

With the industry watching closely, private equity firm starts spending from its massive $12 billion distressed property fund
By Dan Weil | January 14, 2010 10:30AM

From the January issue: After sitting on the sidelines for the last two years, the Blackstone
Group, the world’s largest private equity firm, is finally starting to
go property shopping. And, as it begins to deploy its $12 billion
distressed asset fund, many in the industry are watching to see exactly
what kind of real estate it’s buying and what else it’s in the market
for. In November, the Manhattan-based firm agreed to pay about $191
million for a 60 percent stake in two malls owned by the Ohio-based
Glimcher Realty Trust, a real estate investment trust with properties
in 13 states. That followed a deal in September giving Blackstone 50 percent of
the Broadgate office development in London, the largest office complex
in the city’s financial district, for about $127 million. Also that
month, Blackstone agreed to buy 148 properties from
assisted-living-home operator Sunwest Management of Salem, Ore. If those three deals are any indication, the firm — which famously
bought mogul Sam Zell’s $39 billion Equity Office Properties portfolio
in 2007 and successfully flipped much of it before the market soured —
will be spending the rest of its $12 billion across multiple sectors of
the market.

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