American Realty To Sell Shopping Centers To Blackstone-DDR JV For $1.975 Bln

(RTTNews) - American Realty Capital Properties Inc. (ARCP) announced Thursday that it agreed to sell its multi-tenant shopping center portfolio for $1.975 billion in cash to a joint venture between affiliates of Blackstone Real Estate Partners VII and DDR Corp. (DDR).

The sale is expected to close by late third quarter 2014, subject to customary closing conditions.

Separately, DDR Corp. said that DDR and an affiliate of Blackstone Real Estate Partners VII announced the formation of a third joint venture to acquire 76 shopping centers currently owned by American Realty Capital Properties Inc.

The joint venture has executed a purchase and sale agreement to acquire the portfolio in a transaction valued at $1.975 billion, including assumed debt of $461 million and approximately $800 million of new financings. Blackstone owns 95% of the common equity of the joint venture and an affiliate of DDR owns the remaining 5%.

DDR noted that it will also invest up to a maximum of $300 million in preferred equity in the joint venture with a fixed dividend rate of 8.5%, and has agreed to provide customary leasing and management services.

In addition, DDR will have the right of first offer to acquire ten of the assets under specified conditions consistent with past transactions.