Michael Jackson's iconic Neverland [File photo]

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Jackson, who died in June 2009 at age 50 after receiving an overdose of the powerful anesthetic propofol administered by his personal doctor, had signed an agreement in 2008 with Colony Capital to allow the company to manage his Neverland Ranch due to the financial crisis.

"Sadly, Michael lost control of Neverland during his life as a result of advice from a former manager," the representatives said.

Billionaire Tom Barrack's Colony Capital took over the US$23 million note held by private equity fund Fortress in 2008. Colony Capital has continued to fund the upkeep of Neverland over the past 6 years. Although Jackson and his estate retained a stake in the property, the 2008 agreement stipulated that Colony Capital retained the right to sell the property at will.

"We are saddened at the prospect of the sale of Neverland, which, under the agreement negotiated during Michael's lifetime, Colony has the right to sell," said the statement by the Estate of Michael Jackson. The estate said they would still maintain Jackson's family home in Encino, including its iconic recording studio, but could not do anything to prevent Colony Capital from selling Neverland.

"The Estate is sad and disappointed by Colony's decision," the representatives for the Jackson estate said. "Michael's legacy is in his music, in his humanitarian efforts, and in his spirit. The Estate hopes that whomever the new owners may turn out to be, that they will continue to appreciate the property not only for its beauty but for its historical and cultural legacy as well."

Jackson purchased the 2,700-acre estate, formerly the Sycamore Valley Ranch, in 1988 and named it after the land from the Peter Pan fairytale, in which the main character refuses to grow up. Jackson built a private amusement park, zoo, train station, theater and more on its grounds.