Blackstone puts 40% of BREDS ll’s capital to work

Blackstone Real Estate Debt Strategies has now invested 40% of its second, $3.5bn debt vehicle. Up to half of BREDS II’s equity can be invested in Europe and the European BREDS team, led by Joe Pedlow, started investing at the beginning of last year.

The fund’s niche investment focus is complex, higher-yielding transactions. One of these comprised a two-year bridge loan for Alchemi Group, secured against Great Minster North in Victoria, SW1, which is leased to a government tenant with a lease break next year.

Alchemi is seeking planning consent to redevelop the office and retail building into up to 120 flats. BREDS provided the developer with £65m of whole-loan financing in the final months of last year.

The fund has sold down £35m of the senior debt to ING Real Estate Finance and kept £30m of mezzanine debt for its own fund. Blackstone’s mortgage REIT, Blackstone Mortgage Trust, this month provided a £70m loan for the second-phase refurbishment of Rowan’s and GI Partners’ Aldwych House in London’s Midtown.