New York (HedgeCo.Net) – In another major acquisition, the mortgage department of hedge fund giant Blackstone Group today announced that they have signed an agreement to acquire a $4.6 billion commercial mortgage loan portfolio from GE Capital Real Estate.
The loan portfolio consists of 82 first mortgage loans secured by a diverse set of commercial property types across its core and target markets, including the United States (68%), Canada (15%), the United Kingdom (10%), and Germany (7%).
In March, the Blackstone group bought the Chicago’s Willis Tower, a 3.8 million square-foot office building in downtown Chicago for $1.3 billion, according to early reports. The hedge fund investor also made an undisclosed strategic investment with RedOwl Analytics, in the same month.
The new acquisition is a part of the larger $23 billion acquisition of the majority of GE Capital’s real estate business by investment vehicles managed by Blackstone and by Wells Fargo.
“This is a huge leap forward for Blackstone Mortgage Trust (BXMT), and highlights the unparalleled benefits of being part of the Blackstone Real Estate platform.” Michael Nash, Executive Chairman, said, “This was a complex transaction we were uniquely equipped to evaluate, and to move with speed and certainty to signing. BXMT will be adding $4.6 billion of loans, which effectively doubles the size of our asset base. We expect our stockholders will realize significant value accretion from this greater scale.”
BXMT will pay $4.4 billion for the funded loan portfolio and assume $0.2 billion of unfunded commitments. Wells Fargo has agreed, subject to customary terms and conditions, to provide a $4.0 billion acquisition financing package of which $3.8 billion will be funded at closing. The weighted average final maturity of the acquired portfolio is approximately three year.
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