Blackstone Advisory Partners
Selected Transactions

May 2009

Company Description
Pershing Square Capital (large activist hedge fund) accumulated a significant unsecured debt and equity position in General Growth Properties (GGP) immediately prior to GGP’s bankruptcy. GGP is the second largest shopping mall REIT in the U.S. and was the largest real estate bankruptcy ever in the U.S.

Situation Overview
Advised Pershing Square on strategy, diligence / valuation and bankruptcy matters with respect to Pershing Square’s large economic ownership position in GGP. Additionally, Blackstone advised Pershing Square on its proposal to be GGP's DIP lender in bankruptcy (and completed asset level valuation analysis to advise on DIP collateral pool), which Pershing Square was awarded, but then later topped in an auction process after earning a break-up fee. Blackstone has been a long-term advisor to Pershing Square on several assignments whereby Pershing Square accumulated large economic positions, including McDonalds, Wendy’s and Longs Drug.

Transaction Summary
Pershing Square acquired a significant stake in GGP immediately prior to its bankruptcy based on the belief that GGP was a solid business with a bad capital structure, which could be addressed and corrected in an orderly bankruptcy process. Pershing Square has played a major role in preserving the equity holder’s value in GGP (including taking a board seat). Since Pershing Square’s initial investment, GGP’s equity and unsecured debt values have significantly appreciated for all stakeholders.

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