Beachwood, Ohio -- Blackstone's flagship real estate fund and DDR Corp. announced Thursday hat a joint venture formed by the two entities has closed on the acquisition of a portfolio of 46 shopping centers previously owned by EPN Group.
The joint venture has assumed approximately $635 million of senior non-recourse debt and has originated an additional $320 million non-recourse loan facility, which has a five-year term.
DDR's contribution was $17 million of common equity, $150 million of preferred equity with a fixed dividend rate of 10%, and DDR assumed a pro rata share of joint venture debt of $48 million. As previously announced, DDR will fund its entire investment with proceeds from the January issuance of 19 million common shares on a forward basis to be settled shortly.
Blackstone Real Estate Partners VII, a real estate fund managed by Blackstone on behalf of its investors, owns 95% of the common equity of the joint venture and an affiliate of DDR owns the remaining 5%. DDR will continue to provide leasing and management services and has the right of first offer to acquire ten of the assets under specified conditions.
The 46 shopping centers acquired by the joint venture are open-air, value-oriented power centers located in 20 states, representing 10.6 million sq. ft. and are currently 90% leased. The top ten tenants by base rent include the TJX companies, Kohl's, PetSmart, Dick's Sporting Goods, Best Buy, Bed Bath & Beyond, JoAnn's, Old Navy, Walmart and Home Depot.