The Blackstone Group and joint venture partner British Land have signed a development and lease agreement with Swiss bank UBS at their London Broadgate office complex.
The deal will remove a significant risk for Blackstone, which acquired a 50 percent interest in the 16-building, 4.4 million square foot scheme next to Liverpool Street Station, in 2009.
This is because a lease break could have allowed UBS to walk away from the complex. Instead, the bank has agreed to occupy a redeveloped headquarters building on a weighted average lease length of 18 years on the site of its existing buildings at numbers 4 and 6 Broadgate.
Blackstone’s joint venture was valued at £1 billion (€1.18 billion; $1.73 billion) at the time it acquired a stake in the complex, which also houses other financial giants such as Deutsche Bank, Henderson Global Investors, RBS and Lloyds.
The firm completed the deal by deploying £77 million of equity and by assuming approximately £1 billion in debt through its €3.1 billion Blackstone Real Estate Partners Europe III and its Blackstone Real Estate Partners VI funds.