Taubman Centers announced late last week that it has agreed to sell a 50 percent stake in the shopping centre assets of its Asian division to US alternative investment giant Blackstone in a deal valued at $480 million.
The transaction gives Blackstone significant holdings in three fully-leased shopping centres – one each in the Chinese cities of Xi’an and Zhengzhou, and a third in the South Korean city of Hanam – as Stephen Schwarzman’s New York-based firm continues to buy up retail properties in Asia.
For Michigan-based Taubman, which began developing the first of the three properties through its Taubman Asia division in 2013, the investment from Blackstone allows the company to realise a capital gain on its Asian investments while allying with one of the world’s largest real estate investors for potential future expansion in the region.
Blackstone Adds Stake in Three Malls to Asia Portfolio
“We’re excited to partner with a best-in-class developer and operator in Taubman and add these high-quality assets to Blackstone Property Partners’ recently launched Core Plus real estate investment unit in Asia,” Chris Heady, Asia Pacific chairman and head of real estate for Asia at Blackstone said in a statement.
The deal gives Blackstone a 17.15 percent stake in Taubman’s Starfield Hanam project in Korea, a 25 percent interest in CityOn Xi’an in the capital of China’s Shaanxi province and a 24.5 percent holding in CityOn Zhengzhou, in the capital of China’s Henan province. The two mainland properties were developed as joint ventures with Beijing’s Wangfujing department store, while the Korean project was co-developed with Korean department store operator Shinsegae Group.
In mid-2018 Blackstone closed on $7.1 billion in investment for its Blackstone Real Estate Partners Asia II fund.
Sources at Blackstone declined to comment on the potential for developing future retail centres in Asia with Taubman. However, in a statement, Robert S. Taubman, chairman and CEO of the firm that bears his family name said, “We think Blackstone will be a valuable strategic partner that can help us grow our platform in Asia.”