Beachwood, Ohio and New York – Blackstone owns 95 percent of the common equity of the joint venture and an affiliate of DDR owns the remaining 5 percent.
Beachwood, Ohio and New York – DDR Corp. and an affiliate of Blackstone Real Estate Partners VII have formed a third joint venture to acquire 76 shopping centers currently owned by American Realty Capital Properties Inc. The joint venture has executed a purchase and sale agreement to acquire the portfolio for nearly $1.98 billion. The transaction includes assumed debt of $461 million and approximately $800 million of new financings.
Blackstone owns 95 percent of the common equity of the joint venture and an affiliate of DDR owns the remaining 5 percent. DDR will also invest up to a maximum of $300 million in preferred equity in the joint venture, and has agreed to provide leasing and management services.
The 16.4 million-square-foot portfolio primarily consists of prime power centers located in Los Angeles, Houston, Denver, Chicago, Atlanta, Phoenix and Washington, D.C. The portfolio features high-quality retailers such as Whole Foods, Trader Joe’s, The Fresh Market, Costco, Target, Walmart, Kohl’s, PetSmart, Dick’s Sporting Goods, Bed Bath & Beyond, T.J. Maxx and Marshalls. The portfolio is 95.1 percent leased, and the average base rent per square foot is 6 percent below DDR’s current prime portfolio.
Goldman, Sachs & Co. and KeyBanc Capital Markets served as advisors to DDR on the transaction. The acquisition is anticipated to close in the third quarter of this year.
— John Nelson