The Highstreet real estate joint venture, owner of approximately 90 retail store properties, all of which are leased to insolvent Karstadt Warenhaus GmbH, has been successfully restructured. The Highstreet joint venture is controlled by Whitehall and a consortium comprising RREEF, Generali, Pirelli RE and the Borletti Group.
Restructuring of the joint venture became necessary due to Karstadt’s insolvency. In addition to the extension of Highstreet’s credit facility terms and concessions on credit covenants, an agreement was reached with Highstreet’s creditors to make possible the concessions demanded by Karstadt’s insolvency administrator, in particular regarding a reduction in rent and a premature return of individual Karstadt stores. By agreeing to these concessions, Highstreet is supporting the administrator’s current insolvency plan and the subsequent sale of Karstadt.
Gleiss Lutz provided the consortium of RREEF, Generali, Pirelli RE and the Borletti Group with comprehensive advice on the restructuring. Gleiss Lutz’ team was headed up by partners Dr. Jan Bauer (lead, corporate/M&A, Frankfurt), Dr. Andreas Spahlinger (insolvency, Stuttgart), Dr. Bernhard Busch (real estate, Frankfurt), Dr. Burkhard Jäkel (financing, Frankfurt), Dr. Maximilian von Rom (financing, Frankfurt) and Dr. Michael Marquardt (tax, Frankfurt). They were assisted by Dr. Björn Simon (corporate/M&A, Frankfurt), Dr. Christian Brünkmans (corporate/M&A, Düsseldorf), Dr. Christina von Schweinitz (corporate/M&A, Frankfurt), Philipp Naab (real estate, Frankfurt) and Stefan Köhler (tax, Frankfurt).
Whitehall had initially acquired the stores from and leased them back to Karstadt in 2006, with Karstadt initially maintaining a reverse stake of 49% in the “Highstreet” acquisition vehicle. In 2008 Karstadt then sold its 49% interest in Highstreet to the consortium led by RREEF. Gleiss Lutz already acted as lead legal advisers to the consortium on this transaction. The deal – based on a valuation of the Karstadt properties at EUR 4.7 billion at the time – is one of the largest real estate transactions of recent years.
Forward
