Carlyle’s global credit arm is buying a net lease business from iStar in a $3bn (€2.6bn) deal.
Mark Jenkins, the head of global credit at Carlyle, said, acquiring iStar’s net lease business “jump starts our real estate credit strategy, quickly giving us scale to accelerate deployment”.
Jenkins said Carlyle expects to grow the net lease strategy into a $10bn business with a focus on making the product available to the retail channel over time.
“We set out to grow the global credit platform in part by expanding into adjacent, scalable areas and this is another example of how we are delivering,” Jenkins said.
The acquisition is being funded from a combination of Carlyle’s global credit platform and a minority balance sheet investment from Carlyle.
The deal gives Carlyle’s global credit business a diversified US portfolio of triple-net leases spanning industrial, office and entertainment properties across 18.3m sqft. iStar’s net lease investment team overseeing the portfolio will join Carlyle’s real estate credit team.
Jay Sugarman, iStar chairman and CEO, said: “The sale of our net lease portfolio is the culmination of a highly successful investment strategy for iStar and the result of the outstanding efforts of our net lease team, led by Barclay Jones and Catherine Tenney.
“We are pleased to sign an agreement that will recognise the value that we have built up over many years and that will enable the team to continue taking advantage of opportunities in the net lease space on behalf of Carlyle and its investors.”
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