Blackstone's headquarters in Midtown Manhattan
Blackstone has made a slightly more than $1 billion investment in Sydney, Australia's CBD market with its acquisition of two towers from Scentre Group, a regional real estate investor that owns shopping centres in Australia and New Zealand. Funds managed by Blackstone paid A$1.52 billion (US$1.06 billion) for the properties at 100 Market St. and at 77 and 85 Castlereagh St.
The towers were developed by Scentre and delivered in 2011. The transaction price represents almost $800 million in additional value created and has generated an unlevered internal rate of return of over 16% per year for the company, according to Scentre Group CEO Peter Allen.
As part of the deal, Blackstone has secured a 299-year leasehold interest in these properties.
Scentre will also begin a $800 million securities buy-back.
“Together with the recent joint venturing of Westfield Burwood, Scentre Group has now released $2.1 billion of capital to further pursue our strategic objectives, creating long-term value for securityholders,” Allen said in prepared remarks.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
