Blackstone has emerged as the preferred bidder on Project Tower, a €1.8 billion book of property loans related to Irish developer and investor Michael O’Flynn, according to a source with knowledge of the matter.
The US private equity firm offered around €1 billion in a sales process run on behalf of the National Asset Management Agency (NAMA), the bank set up to manage Ireland’s exposure to property assets.
Blackstone reportedly beat rival bids from Deutsche Bank and other US private equity firms including Davidson Kempner, Apollo and Lone Star, to acquire a real estate portfolio predominately comprised of UK assets but also including Irish and German assets.
Another €100 million tranche from Project Tower was sold at the end of March to Kildare Partners, a private equity firm founded by former Lone Star principal Ellis Short.
Amongst Blackstone’s newly acquired assets are the Elysian Tower, a residential development in the Irish city of Cork, a group of office and commercial buildings in the Haymarket district of Edinburgh in Scotland and other assets located in Frankfurt, Germany. The portfolio also includes a number of student accommodation residences, primarily located in the UK, but with some units in Spain and Germany.
UBS advised on the Project Tower sale, which was comprised of three tranches.
The first tranche amounts to €266 million in performing loans due March 2018 and secured by a UK-led student accommodation portfolio. 11 of the assets are located in the UK, with one each in Germany and Spain.
The second tranche is a €540 million book of sub- and performing loans secured by 23 UK investment properties, five UK development schemes and six German investment properties, mostly due in March 2018.
The third is a €1.02 billion sub- and non-performing book of loans in 21 investment properties, 67 residential and commercial developments and 27 development sites throughout Ireland.
Blackstone and NAMA declined to comment.