Michelle Napoliis the editor of Real EstateMedia'sNet LeaseForum, where this article first appeared.

ESSEN, GERMANY—The Whitehall Fund of US-based investment bankGoldman, Sachs & Co. teamed with an Essen, Germany-basedretailer KarstadtQuelle AG in a corporate real estate transactionvalued at 4.5 billion euros (approximately US$5.56 billion).Whitehall now owns 51% of a new company established to own theportfolio of mostly retail properties while KarstadtQuelle, whichreceived an immediate cash payment of 3.7 billion euros (almostUS$4.65 billion), retains the remaining ownership interest.

With the deal, Karstadt rid itself of all debt. The retaileralso expects to receive another 800 million euros (approximatelyUS$1 billion) via participation in the appreciation of the realestate assets as part of its agreement with Whitehall.KarstadtQuelle's affiliate Karstadt Warenhaus GmbH continues tooperate Karstadt's department and sports stores as the tenant underlong-term leasing agreements.