Philip Blumberg Blog

Blackstone to Manage BofA Merrill Lynch Fund

The Blackstone Group, the U.S.-based investment firm, is taking over the management of a portfolio of Asian real estate investments from Bank of America Merrill Lynch according to an ABC News report. The fund, valued at over $2 billion (excluding debt), had closed in late 2008 after raising $2.65 billion from investors worldwide. The deal is expected to close by the end of September.

"Sponsoring real estate investment will not be a core business for Bank of America Merrill Lynch," the bank said in a Financial Times article, adding: "We will continue to be the general partner of the fund and an investor in it." Blackstone will assist in unwinding the Merrill portfolio (called the Asia Opportunities Fund) but will reportedly not acquire any of its assets. The amount that Blackstone will pay for the right to collect management fees from investors in the fund has not been disclosed.

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Blumberg Capital Partners in the News

Blumberg Capital Partners was featured in an article in The National, an Abu Dhabi newspaper, titled "Investors venture back into Gulf region". An excerpt:

Philip Blumberg, the founder and chairman of Blumberg Capital Partners, said: "Abu Dhabi is overbuilt and there are a lot of buildings coming on line, but we see opportunities to develop a building here that caters to a niche market."

Mr Blumberg was passing through Abu Dhabi on a regional tour to promote a new US$1 billion (Dh3.67bn) property fund to take advantage of the bottom of the cycle in the US.

In addition to investing in the US, the fund could develop or invest in property in Brazil, Oman and Abu Dhabi, he said. Mr Blumberg said he would want to form a partnership with a local developer and ensure the Government had a stake in the project as insurance in case problems arose.

To read the full article, click here.

Blumberg Capital Partners in the News

Blumberg Capital Partners was featured in Al-Shabiba, an Omani news paper, in an article titled "Global real estate expert confirms to Al-Shabiba: 2010 will be a painful year for governments, companies, banks and individuals due to loans and financing". An excerpt:

Blumberg Capital offers the latest designs and development management in the Omani market.

A global real estate expert described 2010 as a painful year for governments, banks, companies and individuals due to mass uncalculated borrowing last year, carrying with it a high and painful price; as debts rise the perceived risk increases with governments expected to put a stop to their borrowing trends. Meanwhile; many countries, with Italy and Spain at the forefront in Europe, are set to face serious financial crises. All these factors leave no doubt that real estate companies will also face challenges; particularly the companies that have not worked within balanced lending and financing policies.

Philip F. Blumberg, Chairman and CEO of Blumberg Capital Partners, a US based company, stated that “Oman enjoys wise leadership, a good investment climate and prudent economic policies, all of which encouraged me to come and invest, expanding the horizons of cooperation with businessmen, companies and government agencies involved in hotels and administrative offices, intending to form genuine partnerships with all parties.” Blumberg went on to say “I’d consider my visit successful by simply observing the economic and commercial dynamic in the sultanate, where investors in are characterized by executive intelligence and a strong future vision which will be contributing factors to establishing partnerships in the future”.

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Blumberg Capital Partners in the News

Blumberg Capital Partners was featured this week in an article in Investment International titled "Commercial property funds tipped to provide 25% return over three years". An excerpt:

A huge number of commercial property funds are being launched currently on a global basis. Blumberg Capital Partners, a leading US based investment firm, has launched a $1billion commercial real estate fund to capitalise on distressed properties in the US, the Gulf and Brazil.

"We're seeing very significant interest from the Gulf region in particular. We have both interest and some commitments from institutional and individual investors. The commitments, both soft and hard, are in excess of $100 million," said chief executive and founder Philip Blumberg.

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Blumberg Capital Partners in the News

Blumberg Capital Partners was featured in an article on Emirates Business 24|7 today titled "US-based Blumberg to invest $400min GCC and Brazil". An excerpt:

Blumberg Capital Partners, a US-based investment management company, said it will invest around $400 million (Dh1.47 billion) into developing office projects in the GCC countries and Brazil through its newly-launched $1 billion off-shore real estate fund, company's chairman told Emirates Business.

"The Blumberg Strategic Asset Fund is targeted at $1bn, taking debt into account. Around 30 per cent or less of this will fund development of office projects in Brazil and Gulf. The expected annual return on the fund is likely to be around 26 per cent to 32 per cent," Philip Blumberg said.

Blumberg Capital said it has already received commitments to the tune of around $100m from six to 10 confirmed investors from the Gulf on this closed-end real estate fund.

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Blumberg Capital Partners in the News

Blumberg Capital Partners was featured this week in an article on ArabianBusiness.com titled "US firm targets Gulf with $1bn property fund". The article discusses The Blumberg Capital Partners Strategic Asset Fund, the first to be open to investors outside the US.

An excerpt:

Blumberg Capital Partners, a leading US-based investment firm, has launched a $1bn commercial real estate fund to capitalise on distressed properties in the US, the Gulf and Brazil, the firm's CEO has said.

Almost a third of the capital will be ringfenced for possible investment in the Gulf and the equity fund has attracted interest from local sovereign wealth funds keen to diversify their real estate portfolio, said CEO and founder Philip Blumberg.

"We're seeing very significant interest from the Gulf region in particular. We have both interest and some commitments from institutional and individual investors. The commitments, both soft and hard, are in excess of $100m," he said. "Our first closing will be at $100m and we're well on the way to that."

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Blumberg Capital Partners in the News

Blumberg Capital Partners was recently featured in a Property Week article titled "Homes Rule for India", which comments on the pressures felt in the commercial property market in India and opportunities in real estate. An excerpt:

Despite these obstacles, India offers stable and higher returns in the longer term and this has caught the attention of Philip Blumberg, chairman and chief executive of US-based Blumberg Capital Partners. Blumberg is raising a $1bn fund for the US, of which $300m will be deployed overseas.

He told the conference he would prefer to invest in income-producing assets but Indian law prevents this. “Unlike Dubai, India is a powerful revenue-producing country. If the country wants more money for development, it needs to allow investment in income-producing assets. This will help rotate capital and developers can free up the equity tied into completed projects.”

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NYC Office Building Trades for $29.5 Million Cash

Savanna Investment Management recently announced the sale of 63 West 38th St in New York City's Garment District. The building, a 12 story  office building contains 144,000 sq feet and is only 15% occupied. Savanna initiated its investment in the property in May 2008. According to GlobeSt.com, "Savanna and a hedge fund partner initially invested in the property by originating a senior loan 18 months ago to the prior owners, the release states. Savanna subsequently bought out its hedge fund partner and then negotiated a deed in lieu of foreclosure with their borrower. Once Savanna owned the asset outright, the company then embarked on a two-pronged business plan of repositioning the building and launching an 'aggressive' marketing program to sell it, the release states." 

Savanna declined to disclose the name of the buyer, a joint venture between two local entrepreneurs, which acquired the property in an all cash deal for $29.5 million. 

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Blumberg Capital Partners in the News

Blumberg Capital Partners was featured in a Commercial Mortgage Alert article titled "Blumberg to Market $1 Billion Fund".

An excerpt:

After running into some snags early this year, Blumberg Capital Partners is scheduled to kick off a roadshow next month aimed at raising $1 billion of equity for a fund that would invest in distressed assets.

Market players said that company founder Philip Blumberg will open talks with sovereign wealth funds and other foreign investors after Labor Day.

The equity goal seems ambitious, given the tough environment for raising capital. Few funds of that size have been launched this year. But Blumberg’s real estate investment management firm, which was formed in 1979, boasts on its Web site of having produced a 17% average annual return for its investors from 1992-2008.

To read the full article, click here.