* Brixmor valued at about $6.1 bln
* Brixmor raises $825 mln
* Second largest U.S. retail real estate IPO
By Tanya Agrawal
Oct 30 Shares of Brixmor Property Group Inc
, a shopping center company owned by Blackstone Group LP
, rose as much as 4 percent in their market debut as
investors were drawn to the second-largest U.S. retail real
estate company offering.
The REIT raised $825 million on Tuesday after its initial
public offering was priced at $20 per share, the mid-point of
the range. On Tuesday, Brixmor increased the size of the
offering by 10 percent and sold 41.3 million shares.
The New York-based company's shares were up 2.5 percent at
$20.49. They had risen to $20.85 on Wednesday morning, valuing
the company at about $6.1 billion.
Brixmor's offering is the largest retail real estate IPO
since Simon Property Group Inc raised about $840 million
Brixmor's IPO is closely watched by investors as it paves
the way for Blackstone to bring other companies from its massive
real estate holdings to the public market.
Blackstone has filed IPO plans for U.S. hotel operator
Hilton Worldwide Inc and budget hotel operator Extended Stay
America. It may sell or list budget hotel chain La Quinta Inns &
Blackstone is not selling any shares in the Brixmor offering
and will continue to own about 73 percent of the company after
it goes public while private equity firm Centerbridge Partners
will own about 8.3 percent.
This year has been the busiest for U.S. property offerings
in about a decade as investors look to take advantage of a fall
in commercial property vacancies and low interest rates.
Empire State Realty Trust Inc, owner of the iconic
Empire State Building, raised about $1.07 billion earlier this
month, while California-based homeowner American Homes 4 Rent
raised about $812 million in August.
With 87 million square feet of gross leasable area, Brixmor
is the second-largest owner of neighborhood shopping centers
after Kimco Realty Corp.
Brixmor owns 522 shopping centers across the United States
and counts Kroger Co, T.J. Maxx chain parent TJX Cos Inc
, Publix Super Markets Inc and Wal-Mart Stores
Inc as its four largest tenants by annualized base rent.
The company said in an IPO filing that grocery chains form
70 percent of its tenants and that its portfolio is 92 percent
Blackstone acquired nearly all of Brixmor's properties when
it bought more than 700 U.S. real estate properties from Centro
Properties Group, a struggling shopping center company based in
Australia, for $9.2 billion in 2011.
It was Blackstone's third-largest real estate investment.
Real estate has been the chief driver of Blackstone's
financial success, and Jonathan Gray, global head of real estate
is seen as a candidate to succeed Chief Executive Stephen
Real estate accounted for 64.7 percent of Blackstone's
economic net income (ENI) in the third quarter. ENI is a measure
of profitability that takes into account the mark-to-market
value of its portfolio.
Bank of America Merrill Lynch, Citigroup, JP Morgan, Wells
Fargo Securities and Barclays were the lead underwriters for the