Blackstone close to debt deal for attempt at Hancock takeover

(Crain's) — Blackstone Group L.P. is close to acquiring $100 million in debt on the John Hancock Tower in an effort to take over the Michigan Avenue skyscraper, according to a report.

About $400 million in loans come due in February on the tower for the owners, the Whitehall fund of Goldman Sachs Group Inc. and Chicago-based Golub & Co., according to the report from Bloomberg News.

New York-based Blackstone is near a deal to buy mezzanine debt on the building, according to Bloomberg, citing “two people with knowledge of the situation.”

Real estate investors will sometimes buy mezzanine, or junior, debt on properties, betting than they can take ownership if the borrower is unable to pay off the loan.

Blackstone and Goldman Sachs declined to comment in the report, and a Golub representative did not respond to Bloomberg's request for comment.

The John Hancock Center, 875 N. Michigan Ave., was 29 percent vacant as of October, according to Bloomberg. It was 26 percent vacant when the Golub-Whitehall venture bought it in January 2007, according to Bloomberg.

The venture paid $383 million for the tower.