Blackstone, Brookfield Said to Bid for Investa Office Portfolio

Blackstone Group LP and Brookfield Asset Management Inc. are among bidders for A$9 billion ($7 billion) of Australian real estate being sold by Morgan Stanley’s Investa Property Group, people with knowledge of the matter said.

LaSalle Investment Management and China’s Fosun International Ltd. also submitted indicative offers by Tuesday’s deadline, the people said, asking not to be identified as the details are private. They will compete with Australian bidders that include Charter Hall Group, Cromwell Property Group and Dexus Property Group, they said.

Morgan Stanley is selling the assets held by Investa Property Group, Australia’s third-biggest owner of city center offices, amid strong investor demand for commercial real estate in Sydney and Melbourne. Some suitors may also bid for A$2.5 billion of Australian office assets held on Morgan Stanley’s balance sheet as well as management rights for the portfolio, two of the people said.

The Australian Financial Review reported the names of some bidders earlier Tuesday, citing unidentified people. A spokesman for Morgan Stanley in Sydney declined to comment, as did spokesmen for Blackstone, Brookfield, Charter Hall, Dexus, Fosun and LaSalle. A representative for Cromwell couldn’t immediately comment.

Overseas Interest

Morgan Stanley Real Estate Investing said Feb. 18 it appointed Morgan Stanley and UBS Group AG to advise on the sale. The bank said at the time that successful bidders could engage Investa’s office management unit to run any of the properties they purchase.

Dexus and Canada Pension Plan Investment Board last year acquired the property fund managed by Commonwealth Bank of Australia, gaining ownership of A$3.2 billion of office buildings. Singapore’s Frasers Centrepoint Ltd. said in June it will purchase Australian developer Australand Property Group for A$2.6 billion.

Funds managed by Morgan Stanley Real Estate agreed in 2007 to buy Sydney-based Investa Property Group, then the country’s biggest publicly traded property owner, for A$6.6 billion including debt.

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