Blackstone buys troubled shopping centre after years in limbo

http://www.theaustralian.com.au/business/property/blackstone-buys-troubled-mall/story-fn9656lz-1226519908536

Blackstone buys troubled shopping centre after years in limbo

PRIVATE equity giant Blackstone has waded deeper into Australian real estate, paying $341 million for the Top Ryde City shopping centre in Sydney, a source has confirmed.

The Australian unveiled Blackstone's interest on Thursday, reporting that the firm was competing with a partnership comprising investment bank Goldman Sachs and Lend Lease for what was one of the most problematic retail developments to be completed during the global financial crisis.

The mall, 14km northwest of the Sydney CBD, underwent an $800 million redevelopment that caused the company of former BRW rich-lister John Beville to collapse.

Offers of less than $350m for the centre were made to receivers, after numerous unsuccessful attempts to sell the mall over the past two years for up to $650m -- the amount of debt owing.

Blackstone, which manages assets worth $US205 billion ($196.7bn), would not comment on the deal yesterday.

The New York-based firm now owns the Sydney-based Valad Property Group, a business that had previously provided a $90m mezzanine loan on the centre through its financing arm. When it was still listed on the stock exchange, Valad wrote off the loan after trying to sell the debt.

McGrathNicol partner Joseph Hayes, the receiver of Top Ryde City, ran an expressions-of-interest campaign to sell the property, and final bids closed on Friday.

The original syndicate of banks tried to offload debt last year. Suncorp is believed to have sold its loan to Goldman Sachs for less than 50c in the dollar.

The original shopping centre, on the corner of Blaxland Road and Devlin Street in Ryde, was demolished in 2007 and the redevelopment took three years.

In 2010, Mr Beville placed the 250-shop centre up for sale, and McGrathNicol was appointed in February last year.

http://www.theaustralian.com.au/business/property/blackstone-buys-troubled-mall/story-fn9656lz-1226519908536