CHICAGO-In a move toward focusing on a select group of core businesses, Security Capital Group Inc. has sold its extended-stay lodging company Homestead Village to Blackstone Real Estate Advisors for $740 million. Homestead Village has 141 properties in 28 states, with about 30% of them in California and Texas.

Blackstone Real Estate Advisors, based in New York and London, paid $480 million in cash, assumed $145 million of debt and gave Security Capital a five-year note for $115 million at 12% in its first year, with annual increases of 100 basis points.

“The sale of Homestead is in keeping with Security Capital’s stated intention to exit businesses that do not fit the company’s current strategy,” explains Security Capital vice chairman C. Ronald Blankenship. “This strategy is to focus capital in six private real estate operating divisions that will lead the industry in high sustainable return on equity and earnings growth. This transaction places the company in an even stronger position to execute its strategy, as well as to fund additional share repurchases.”

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