Saturday, June 12, 2010

Carlyle Group Gets China Financing for 650 Madison Avenue

The Carlyle Group announced refinancing of 650 Madison Avenue. The press release cited several firsts:

Global alternative asset manager The Carlyle Group and Ashkenazy Acquisitions Corporation today announced that they have successfully concluded a $355 million refinancing of 650 Madison Avenue in New York, NY. This is one of the largest single asset refinancings in New York since 2008.

The mortgage loan was provided by Wells Fargo Bank, National Association and Industrial And Commercial Bank Of China Limited (ICBC), New York Branch. This is the first time ICBC has financed a large commercial real estate transaction in the United States.

Carlyle Principal Andrew Chung said, “This transaction demonstrates that for trophy assets with proven owners, liquidity is available. We appreciate the efforts of our financing sources.”

Chinese banks doing business in the United States? It seems the U.S. Treasury has a lever on the yuan-renminbi currency float issue.

ICBC also focuses on the Middle East, Carlyle's longtime investor backyard. Both have global aspirations and reach. Carlyle co-founder David Rubenstein predicted China will become the world's largest private equity investor. Foreign firms pay up for the right to do business in China.

Recall global finance raced ahead of regulatory and environmental concerns, until their accumulated sins had firms begging for public bailouts. Don't forget China's response. They refused to honor derivative commitments. It seems Carlyle and China have much in common.

ICBC pushes into the U.S. in a large way.

Update 3-17-11:  Chinese banks enter New York real estate in a big way.