Blackstone Buys Equity Office, Sells City Buildings to Macklowe
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Blackstone Group LP will sell eight New York office buildings it is acquiring from Equity Office Properties to Macklowe Properties, the owner of New York’s General Motors Building, for about $7 billion, according to people familiar with the transaction.
The sale would include about 6.5 million square feet of Midtown Manhattan office space, the people said, and the transaction would close as early as February 9. The price would put the sale at more than $1,000 a square foot.
Blackstone won the bidding contest yesterday for Equity Office after shareholders approved the $39 billion purchase in the biggest leveraged buyout ever.
Equity Office investors approved the $55.50 a share cash offer at a meeting today in Chicago. The approval, by 71% of outstanding shares, came hours after Vornado Realty Trust abandoned its $56 cash and stock bid.
Blackstone upped the ante twice to thwart Vornado, increasing its bid by 8%from its initial $48.50 a share offer on Nov 19. Blackstone Chief Executive Officer Stephen Schwarzman will take control of the largest U.S. office landlord with more than
540 properties from New York to Los Angeles as rents rise and vacancies fall.
Yesterday’s vote is a defeat for Vornado Chairman Steve Roth, who wanted to buy Equity Office to expand the company’s office holdings and make up for lost real estate opportunities.
