Investment by Goldman Sachs, MSD Capital, Mubadala Development and Olayan
Group Will Support Future Growth and Provide Access to Vast Capital
Resources
NEW YORK, Dec. 17 /PRNewswire/ -- Related Companies, one of the
nation's leading private real estate development firms, today announced a
nearly $1.4 billion equity and debt investment, the first outside
investment in the company. Goldman Sachs and MSD Capital, LP have purchased
equity stakes in Related totaling 7.5 percent. Three international entities
will also invest through a debt placement, including an affiliate of
Mubadala Development Company and The Olayan Group.
In addition to the corporate investment, each investor will co-invest
in future development opportunities undertaken by Related. This elite group
of investors has been specifically selected to fund future growth. The
minority investment in Related includes no involvement in the governance of
the company and there will be no change in Related's management structure.
"This is a historic transaction for Related which will enable us to
write a new chapter of our growth. This carefully-selected, prestigious
group of investors will allow us to reinforce our position as one of the
nation's leading developers, managers and financiers of premier real estate
properties," said Related Chairman and CEO Stephen M. Ross. "In the last
decade, the size, scope and geographic diversity of Related's development
pipeline has increased dramatically with Time Warner Center and Moynihan
Station in New York City, Grand Avenue in downtown Los Angeles, CityPlace
in West Palm Beach, CityNorth in Phoenix and Snowmass Village in Colorado.
As the industry continues to move toward bigger, more complicated
development transactions, these new financial partnerships ensure that
Related has a ready and deep source of capital to take advantage of
virtually any opportunity regardless of size or scale."
Related President Jeff T. Blau said, "This access to new capital offers
Related a tremendous competitive advantage. We are currently involved in
some of the most ambitious real estate developments in the nation and are
competing for a once-in-a-lifetime opportunity-to create a 26-acre, vibrant
mixed-use waterfront neighborhood at the West Side Yards in New York City.
This investment into our company is more than a financial arrangement.
These long- term relationships will provide us with the financial
flexibility to capitalize quickly on even the most challenging future
opportunities. Above all else this show of confidence from the world's most
elite investors is a testament to the strength of our team-a group of the
brightest and most innovative and skilled employees, who are truly the best
in the industry."
Related's current pipeline is comprised of marquee projects across the
nation including: Grand Avenue, a multi-phase 3.6 million square foot, $3
billion development spanning three city blocks in downtown Los Angeles,
California; the $3 billion, 80-acre Snowmass Village Resort development in
Colorado; the 144-acre CityNorth mixed-use development in Phoenix, Arizona;
and the development of the 7.5 million square foot Moynihan Station complex
in New York City.
Stuart Rothenberg, Global Head of Real Estate Principal Investments at
Goldman Sachs, said, "We're excited to make a strategic investment with a
best-in-class developer and highly skilled management team. Related has a
history of creating value and has developed some of the country's most
financially successful projects."
Barry A. Sholem, Partner responsible for MSD Capital's Real Estate
Group, said, "MSD Capital is pleased to make this equity investment in
Related, which is led by one of the strongest management teams in the
business. Related is developing some of the most exciting projects in the
country, and we look forward to growing our partnership with them over the
long term."
Khaldoon Khalifa Al Mubarak, Mubadala CEO and Managing Director, said,
"Related is a strong fit for Mubadala. We share their approach to investing
in premier projects that build long-term value. Related has great
leadership and an impressive project pipeline with even more potential
opportunities."
Anthony S. Fusco, The Olayan Group's U.S. vice president for real
estate, said, "This investment continues our organization's strategy of
creating long- term alliances in all of our lines of business with strong,
qualified, strategic partners. As a top developer and property manager in
the U.S. market, Related certainly fulfills that role."
Related was advised by a team that included Goldman Sachs, Deutsche
Bank and Eastdil Secured.
About Related Companies:
Heralded as one of the most prolific and visionary developers in the
country, Related Companies was formed over thirty-five years ago. Today
Related is considered the most prominent privately owned real estate
development firm in the United States, headquartered in New York City with
divisions in development, acquisitions, property management, marketing and
sales. In 2004, Related completed the development of New York City's newest
landmark, Time Warner Center. Related has offices and major developments in
Miami, Los Angeles, San Francisco, Chicago and Boston and boasts a team of
more than 2,000 professionals. To date, Related has real estate assets
worth over $15 billion with another $9 billion currently in development. In
Los Angeles, Related is expanding its portfolio with The Century, a
super-luxury condominium in Century City and the Frank Gehry-designed Grand
Avenue development, situated directly across from the beloved Walt Disney
Concert Hall, which will include luxury residences, retail, notable
restaurants and a world class hotel.
Related is staunchly committed to sustainable design with over $6
billion in green development underway or completed. The firm developed one
of the first green residential buildings in the nation, Tribeca Green in
Battery Park City, New York and Chicago's first green residential building,
340 on the Park. Related is currently developing eight new LEED-certified
residential buildings, The Brompton, The Harrison, and Superior Ink in New
York City, The Clarendon in Boston, The Century in Los Angeles, The Village
in Santa Monica, Canyon Ranch Living and The Peshtigo in Chicago as well as
Bronx Terminal Market, a one million square foot retail development in
Bronx, New York. Related serves on the board of directors of the World
Resources Institute.
Earlier this year Related acquired a majority stake in Virgin
Megastores North America and this past year acquired Equinox(R) Fitness
Clubs, further expanding the company's capabilities into the health and
fitness arena and enhancing the value of its properties by incorporating an
exclusive, branded amenity into the lifestyle offering. The company is also
the largest shareholder in Centerline, the leading financier of affordable
housing in the country. For more information about Related Companies please
visit http://www.related.com.
About Goldman Sachs:
Goldman Sachs is a leading global investment banking, securities and
investment management firm that provides a wide range of services worldwide
to a substantial and diversified client base that includes corporations,
financial institutions, governments and high net worth individuals. Founded
in 1869, it is one of the oldest and largest investment banking firms. The
firm is headquartered in New York and maintains offices in London,
Frankfurt, Tokyo, Hong Kong and other major financial centers around the
world. For more information, visit http://www.gs.com.
About MSD Capital, L.P.:
MSD Capital was formed in 1998 to exclusively manage the capital of
Michael S. Dell and his family. The firm currently manages in excess of $12
billion in assets and participates in a broad range of investment
activities, with its primary focus on investing in publicly-traded
securities, real estate and traditional private equity. For more
information, visit http://www.msdcapital.com.
About Mubadala Development Company:
Mubadala is an investment and development company headquartered in Abu
Dhabi, the capital of the United Arab Emirates. Wholly-owned by the Abu
Dhabi Government, Mubadala's mission is to create and maximize long-term
returns as an engaged investor in high-performing businesses and promising
new ventures. The company has a growing and multifaceted international
portfolio, with significant interests in sectors such as energy,
telecommunications, infrastructure, real estates and aerospace. For more
information, visit http://www.mubadala.ae.
About The Olayan Group:
Founded in 1947, The Olayan Group is a private, multinational
enterprise that is both a leading diversified business in Saudi Arabia and
a major investor internationally. The group comprises some 50 companies and
affiliated businesses engaged in product distribution, manufacturing,
services and investment. It has offices in New York, London, Athens,
Vienna, Riyadh, Al-Khobar and Jeddah. For more information, visit
http://www.olayan.com.
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