NEW YORK CITY-Add the Blackstone Group to the list of potentialsuitors for Australia-based Centro Properties Group, owner of 600shopping centers in the US. The Wall Street Journalreported that the private equity giant has submitted an indicativebid for Centro, which is soliciting buyout offers. A Blackstonespokesman did not return GlobeSt.com’s calls for comment bydeadline Wednesday afternoon.

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Blackstone’s reported interest in Centro provides furtherevidence that the company is ramping up its commercial real estateinvestment activity here and abroad, 21 months after CEO StephenSchwarzman advised a Japan Society audience in New York City to“keep away from real estate for now.” In October, Blackstone strucka $1-billion deal for 180 ProLogis industrialproperties covering more than 20 million square feetof warehouse property across the US.

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Earlier this year, the locally-based private equity giant agreedto buy an 80% stake in a joint venture managed by Denver-basedProLogis, a deal that involves 17 million square feet of USwarehouse space. Blackstone is paying $105 million in that deal andassuming $512 million of debt.

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In November, another embattled shopping-center owner, GeneralGrowth Properties, came out from Chapter 11 bankruptcy. Thesuccessful re-emergence was due in large measure to $6.8 billion in newequity capital from a group that included Blackstonealong with Brookfield Asset Management, Fairholme Funds, PershingSquare Capital Management and the Teacher Retirement System ofTexas.

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And in the resolution of another large-scale bankruptcy, a JV ofBlackstone, Centerbridge Partners LP and Paulson & Co. closedon a $3.9-billion acquisition of Extended Stay Inc. and its 680hotel properties. Blackstone staked out another claim in thelodging sector, where it already owns the Hilton Hotel brand thanksto a $26-billionbuyout in 2007, by buying $300 million of junior debton 14 upscale Columbia Sussex hotels.

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As a blog by Peter Lattman of the New York Times pointsout, Blackstone still owns 149 trophy office buildings around theUS even after selling off many of the assets it picked up in its$39.2-billion acquisition of Equity Office Properties in ’07. Lastmonth, the WSJ reported that Blackstone was restructuringabout $7 billion of the debt remaining from the EOP deal, as it hadcut about $4 billion from its Hilton debt earlier this year.

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According to the WSJ, the maturity of the EOP debt willbe extended to 2014 from 2012. In return, Blackstone will pay downthe $7-billion debt by 10% and the interest rate on the remainingdebt will increase by one percentage point. Overseas, BlackstoneGroup’s Europe hotels owner secured about $197 million of mezzanineloans earlier this month from leveraged loan funds, thus reducingthe amount it owes to senior bank lenders, according toBloomberg.

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Another measure of Blackstone’s renewed bullishness incommercial real estate may be seen in the sector’s impact on itsearnings profile then and now. In March of last year, Blackstonereported that its real estate holdings lost $477.3 million in thefourth quarter of 2008 and $718 million for ’08 as a whole,contributing more than half of the company’s losses for that year.In October of this year, by contrast, Blackstone said that its realestate segment had third-quarter revenues of $257.8 million andnine-month revenues of $618.4 million.

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.