Goldman, MSD lead $1.4bn Related deal

A mix of global investors from Goldman Sachs to the Abu Dhabi government fund has directed capital to the private real estate developer.

A consortium of investors including Goldman Sachs, MSD Capital, Mubadala Development and Olayan Group have made a $1.4 billion (€1 billion) investment in New York-based private real estate development firm Related Companies.

The deal represents the first outside investment in the firm, whose management structure will remain intact post-transaction.

Goldman Sachs and MSD Capital, the investment firm of Dell Computer founder Michael Dell, purchased equity stakes in Related totaling 7.5 percent. Other consortium members include three international investors providing debt, including an affiliate of Mubadala Development Company—the Abu Dhabi Government strategic investment and development company—and Saudi investment company The Olayan Group.

The agreement also includes co-investments by the consortium in future Related developments.

Related currently holds $15 billion of property assets with an additional $9 billion under development. The firm completed the 2.8-million-square-foot, $1.7-billion Time Warner Center development in New York City’s Columbus Circle in 2004 and is currently proposing development of a 26-acre, mixed-use waterfront community at the West Side Yards in New York City, in partnership with Goldman.

Other Related projects include the $3 billion Grand Avenue development in downtown Los Angeles; the $3-billion, 80-acre Snowmass Village Resort in Colorado; the 144-acre CityNorth mixed-use development in Phoenix, Arizona; and the 7.5-million-square-foot Moynihan Station complex in New York City.