Blackstone has agreed to pay $18.7 billion for a portfolio of US logistics assets from Singapore-based investment manager GLP totaling 179 million square feet, almost doubling the firm's US industrial footprint in what reportedly marks one of the largest private real estate transaction to date. GLP's largest tenant is reportedly Amazon, which uses the warehouses to fulfill online orders from a growing number of shoppers, with Whirlpool and FedEx also among its biggest users.
As part of the deal, Blackstone's massive real estate division will acquire 115 million square feet of assets for $13.4 billion. Blackstone Real Estate Income Trust will buy an additional 64 million square feet for $5.3 billion. Overall, the New York investor's real estate division has about $140 billion in AUM, with investments across North America, Europe, Asia and Latin America.
Blackstone reportedly beat out real estate company Prologis and investor Brookfield Asset Management to win the deal, which The Wall Street Journal reports will include about $8 billion in debt. Overall, the firm will assume control over roughly 1,300 properties, most of which are reportedly near cities and fill a need for the next-day deliveries that have become common for ecommerce companies such as Amazon.
As more consumers go online, Blackstone has been hard at work growing its logistics portfolio. In a press release, Ken Caplan, Blackstone's co-head of global real estate, pointed to increased demand from the ecommerce space as one reason that investing in logistics is at the top of the firm's list of priorities. Last year, the firm bought Gramercy Property Trust for roughly $7.6 billion and Canyon Industrial Portfolio assets for roughly $1.8 billion. In 2017, the firm sold European warehouse operator Logicor to China Investment Corp. for €12.25 billion (about $13.8 billion), then bought back a 10% stake in the company six months later.
It appears to be a good time for Blackstone to spend big. The firm is reportedly nearing a close for a record buyout fund totaling $25 billion and is raising a real estate debt fund targeting $5 billion. The firm also plans to raise a $40 billion infrastructure fund, with the Saudi Arabia Public Investment Fund putting up half the total. And last year, it closed a roughly $20 billion deal to buy a majority stake in the financial and risk business of Thomson Reuters, later renaming the company Refinitiv.
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