(Read more on the debt and equity markets.)
NEW YORK CITY-Locally based Related Cos. has received a nearly $1.4 billion equity and debt investment, the first outside investment in the company. Goldman Sachs and MSD Capital LP have purchased equity stakes in Related totaling 7.5%. Three international companies will also invest through a debt placement, including an affiliate of Mubadala Development Co. and the Olayan Group.
In addition to the corporate investment, each investor will co-invest in future development opportunities undertaken by Related. The group of investors has been specifically selected to fund future growth, the company explains. The minority investment in Related includes no involvement in the governance of the company and there will be no change in the company's management structure.
"This carefully-selected, prestigious group of investors will allow us to reinforce our position as one of the nation's leading developers, managers and financiers of premier real estate properties," notes Related chairman and CEO Stephen Ross in a prepared statement. "In the last decade, the size, scope and geographic diversity of Related's development pipeline has increased dramatically with Time Warner Center and Moynihan Station in New York City, Grand Avenue in downtown Los Angeles, CityPlace in West Palm Beach, CityNorth in Phoenix and Snowmass Village in Colorado. As the industry continues to move toward bigger, more complicated development transactions, these new financial partnerships ensure that Related has a ready and deep source of capital to take advantage of virtually any opportunity regardless of size or scale."
Related President Jeff Blau says that "this access to new capital offers Related a tremendous competitive advantage. We are currently involved in some of the most ambitious real estate developments in the nation and are competing for a once-in-a-lifetime opportunity—to create a 26-acre, vibrant mixed-use waterfront neighborhood at the West Side Yards in New York City. This investment into our company is more than a financial arrangement. These long-term relationships will provide us with the financial flexibility to capitalize quickly on even the most challenging future opportunities."
Related's current pipeline is comprised of projects across the nation including: Grand Avenue, a multi-phase 3.6 million-sf, $3 billion development spanning three city blocks in downtown Los Angeles; the $3 billion, 80-acre Snowmass Village Resort development in Colorado; the 144-acre CityNorth mixed-use development in Phoenix, Arizona; and the development of the 7.5 million sf Moynihan Station complex in New York City.
Related was advised by a team that included Goldman Sachs, Deutsche Bank and Eastdil Secured.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
