Edens closes $1.5 billion equity transaction

Columbia, S.C. — Edens Investment Trust has closed a $1.47 billion equity transaction composed of the $718 million sale of a 29% equity stake in the company and a $750 million equity commitment from the company’s institutional investors.

In the sales transaction, a Blackstone-sponsored real estate investment vehicle acquired a $718 million stake in Edens from the State of Michigan Retirement System.

Blackstone, the New York State Teachers’ Retirement System and institutional investors advised by J.P. Morgan Asset Management now own approximately equal shares in the grocery-anchored shopping center developer, owner and operator. Edens' management owns approximately 7.5% of the company.

The three institutional investors plan to invest an additional $750 million in Edens to enable renovations and acquisitions.

According to the Wall Street Journal, the Edens investment represents a more conservative investment than usual for Blackstone, which typically buys into companies with problems and in need of turnaround capital. Blackstone repairs such companies and then sells them, aiming for 20% in annual returns.

Citing people familiar with Blackstone’s strategy, the Wall Street Journal said that Blackstone aimed to generate profits of 5% to 6% per year through Edens’ expansions.

Edens has expanded strongly over the past 17 years. In 1997, the private company was valued at $250 million. Today, Edens’ management puts the company’s value at $4 billion, with the goal of growing to $7 billion.

According to Edens, the company will use the $750 equity commitment to fund growth through select urban acquisitions, redevelopments and new developments in the major East Coast metropolitan areas of Boston, New York City, Washington, D.C., Atlanta, and Miami.

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