Skip to main content
MENU
Subscribe
  • Sign Up Free
  • LOGIN
  • Subscribe
  • Topics
    • Alternatives
    • Artificial Intelligence
    • Consultants
    • Defined Contribution
    • ESG
    • ETFs
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Regulation
    • SECURE 2.0
    • Special Reports
    • Washington
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Influential Women in Institutional Investing 2023
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • 2023 ESG Investing Conference
    • ESG Rated ETFs
    • Divestment Database
  • Defined Contribution
    • Latest DC News
    • The Plan Sponsor's Guide to Retirement Income
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • DC Plan Design: Improving Participant Outcomes
    • 2023 Defined Contribution East Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
Breadcrumb
  1. Home
  2. Investments
June 03, 2019 01:00 AM

Blackstone bets on e-commerce with $18.7 billion logistics deal

Bloomberg
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Bloomberg

    Blackstone Group is doubling down on the future of online shopping, agreeing to buy $18.7 billion of U.S. logistics assets from Singapore's GLP in what it says is the world's biggest private equity real estate deal.

    Blackstone will gain 179 million square feet of warehouse assets, greatly expanding the size of its U.S. industrial footprint, the company said in a statement late Sunday.

    As online shopping grows in popularity, the need for warehouse space by retailers seeking to expand their digital operations and cut delivery times has ballooned. That's lured investors into logistics real estate at a time when other types of commercial property transactions have slowed amid concern over rising interest rates and a pullback by foreign investors.

    The sale comes amid record fundraising for private equity real estate funds and a flurry of warehouse deals. Blackstone acquired Canyon Industrial Portfolio's last-mile properties for $1.8 billion in March last year, adding to a string of similar purchases it's made in the logistics arena.

    The world's biggest alternative asset manager also agreed to purchase Canada's Pure Industrial Real Estate Trust in a C$2.5 billion ($1.9 billion) deal in January last year, plus more than 100 warehouse assets from Harvard University's endowment for $950 million in September. Much of that portfolio is also made up of so-called last-mile warehouses, which have grown in value as e-commerce companies expand and seek faster deliveries.

    The last mile — or getting products bought via the internet to a person's house — is becoming a key differentiator in driving revenue growth, according to Bloomberg Intelligence. This means "starting with a focus on delivery and working backward, keeping the customer experience at the center," BI analyst Jennifer Bartashus said.

    Online growth

    "Making the shopper journey easy, with transparency into order and delivery status is critical to success," she said. "Companies that build engaging experiences for their customers will be rewarded with loyalty and increased spending."

    And online shopping in the U.S., even against the backdrop of a trade war with China, is climbing. Retail e-commerce sales for the first quarter totaled $137.7 billion, an increase of 3.6% from the last three months of 2018, U.S. Department of Commerce data released in May showed. Total retail sales, meanwhile, were estimated at $1.34 trillion, virtually unchanged.

    "Logistics is our highest conviction global investment theme today, and we look forward to building on our existing portfolio to meet the growing e-commerce demand," said Ken Caplan, the global co-head of Blackstone Real Estate, in the statement.

    The GLP portfolio includes about 1,300 properties, and counts Amazon.com as its biggest tenant, the Wall Street Journal reported earlier.

    Record raising

    Blackstone, founded in 1985 by Stephen A. Schwarzman and Peter G. Peterson, has grown to become one of the dominant buyout firms alongside the likes of KKR & Co. and Carlyle Group. In April, the firm reported its assets under management crossed half a trillion, to $512 billion, for the first time.

    Blackstone was the buyer in four of the six biggest property-related acquisitions by private equity firms in the past decade, including the $7.2 billion purchase of Gramercy Property Trust last year and the $5.6 billion deal for Strategic Hotels and Resorts in 2015, data compiled by Bloomberg show.

    The firm is currently seeking $5 billion for its latest real estate fund, a person familiar with the matter said last month. It has also set a $25 billion cap on its latest flagship buyout fund, which would exceed Apollo Global Management's $24.7 billion fund for the industry record.

    Blackstone triumphed in an auction for GLP's assets that drew bids from Prologis and Brookfield Asset Management, according to a person with knowledge of the matter. Melissa Sachs, a spokeswoman for Prologis, declined to comment. A representative for Brookfield didn't immediately respond to a request for comment.

    Blackstone Real Estate's global opportunistic BREP strategy will acquire 115 million square feet for $13.4 billion, while its income-oriented unlisted Blackstone Real Estate Income Trust will acquire 64 million square feet for $5.3 billion, according to Sunday's statement.

    Related Articles
    Blackstone to incorporate as assets top $500 billion
    Blackstone in talks to buy a stake in BC Partners
    Blackstone takes minority stake in Marlin Equity Partners
    Recommended for You
    Greg Medcraft
    Search for yield in low-return future dominates conference
    CITIC Capital Partners closes $2.8 billion China buyout fund
    CITIC Capital Partners closes $2.8 billion China buyout fund
    Africa's biggest fund manager sees gold boom in West Africa
    Africa's biggest fund manager sees gold boom in West Africa
    Multiple Tailwinds Propel Private Credit
    Sponsored Content: Multiple Tailwinds Propel Private Credit
    Sponsored
    White Papers
    Exploring the Commercial Application of Artificial Intelligence
    Conflict Minerals: The human cost of our electronics
    Research for Institutional Money Management
    Private real estate entry points emerging amid selloff
    2023 Hot Topics in Retirement and Financial Wellbeing
    Bonds: Shaken, but Not Stirred
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    December 12, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Custom Content
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Artificial Intelligence
      • Consultants
      • Defined Contribution
      • ESG
      • ETFs
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Regulation
      • SECURE 2.0
      • Special Reports
      • Washington
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Influential Women in Institutional Investing 2023
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • 2023 ESG Investing Conference
      • ESG Rated ETFs
      • Divestment Database
    • Defined Contribution
      • Latest DC News
      • The Plan Sponsor's Guide to Retirement Income
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • DC Plan Design: Improving Participant Outcomes
      • 2023 Defined Contribution East Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars