Blackstone mulls sale of stake in London office complex

Tue Jan 29, 2013 4:53am EST
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By Tom Bill

LONDON (Reuters) - U.S. private equity group Blackstone (BX.N: Quote) may sell its half stake in a London office and retail complex, its partner British Land (BLND.L: Quote) said, a deal that could bring Blackstone a sevenfold return on its original investment.

Blackstone bought its share of the 30-acre Broadgate site in London's financial district from property firm British Land in September 2009 for 77 million pounds ($120.9 million), a stake now valued at 520.5 million pounds after debt, according to British Land's 2012 annual report.

Reuters reported in September 2011 that Blackstone was considering a sale of its stake in Broadgate, which would be one of London's largest property transactions in recent years.

The process appears to have taken a step forward since a lock-up agreement expired late last year, allowing a sale to go ahead.

British Land publicly acknowledged that Blackstone could sell out of Broadgate on Tuesday, saying: "We intend to retain our 50 percent stake and work closely with Blackstone through any sale process".

British Land Chief Executive Chris Grigg said the original sale to Blackstone had enabled his company to rebalance its London portfolio between the City and the West End districts and press ahead with developments that will bring in large profits.

"One can always look back and say 'if I knew then what I know now', but we sold at the time to give us financial flexibility," Grigg told Reuters after a trading update on Tuesday.

Blackstone was not immediately available for comment.   Continued...