UPDATE 1-Karstadt landlord could scupper sale

* Highstreet says no deal with prospective Karstadt buyer

* Karstadt liquidation risk rises if no deal – Highstreet

(Adds Highstreet comment, background)

DUESSELDORF, Germany, June 8 (BestGrowthStock) – Property group
Highstreet warned Karstadt’s prospective buyer Nicolas Berggruen
that the insolvent German retailer could be liquidated if no
deal is struck soon on rents.

Highstreet — a rival Karstadt bidder owned by Goldman Sachs
(GS.N: ), Deutsche Bank (DBKGn.DE: ) and Pirelli Real Estate
(PCRE.MI: ) — has not reached a rent deal yet with Berggruen,
whom creditors picked on Monday as their preferred buyer.
[ID:nLDE6560RM]

“Highstreet is ready to reduce rents by another 230 million
euros ($309 million) in the next five years in addition to the
contribution of 160 million euros over three years pledged in
the restructuring plan,” a spokesman for the consortium said on
Tuesday.

Should this offer — available to all potential Karstadt
buyers — not be taken up, “the probability of a Karstadt
liquidation rises significantly”, he added. “An agreement with
Highstreet is a core component of rescuing Karstadt.”

Berggruen, the billionaire son of a German art collector,
has said he wants to save the Karstadt brand and the 25,000 jobs
at stake and is asking for further concessions from property
owners like Highstreet, which owns about two-thirds of the
Karstadt store space.

Investment Basics

(Reporting by Matthias Inverardi; Writing by Michael Shields)

UPDATE 1-Karstadt landlord could scupper sale