Blackstone in Talks to Buy Logos India Assets for Over $202M

Blackstone Group has entered exclusive negotiations to purchase a trio of India warehouses developed by Logos Property as the US private equity giant continues to up its bets on India logistics.

The Manhattan-based firm has been selected as the preferred bidder for the warehouses in southern India’s Tamil Nadu state and in Haryana, north of Delhi, after offering in excess of INR 17 billion ($202 million) for the portfolio, which spans more than 500,000 square metres (5.4 million square feet), according to market sources who spoke with Mingtiandi. The news of Blackstone being selected as the preferred bidder had been reported earlier in the Indian media.

While no agreement has yet been signed for the proposed acquisition, Blackstone’s co-head of global real estate Kathleen McCarthy said in March this year that the company plans to more than double its logistics portfolio in India with an eye toward a potential future public listing for its holdings in the South Asian nation’s warehouse sector. Blackstone representatives had not yet responded to inquiries from Mingtiandi regarding the discussions with Logos by the time of publication.

Logos was first reported to be marketing the properties, two in Chennai and the third in the Haryana city of Luhari, in July of this year with Singapore sovereign fund GIC and Japanese shipping giant Mitsui OSK Lines said to have been as many as 10 bidders competing for the assets. Representatives of ESR, which took full control of Logos earlier this year, declined to comment when contacted by Mingtiandi.

Near Full Occupancy

The three properties are more than 95 percent occupied, according to local news reports, and generate annual rental revenue of around INR 1.25 billion. Tenants are said to include logistics providers Kuehne+Nagel, NCR Logistics and Mahindra Logistics, US document storage player Iron Mountain and local e-commerce firms Delhivery and HealthKart.

Should Blackstone follow through on acquiring the portfolio at the reported price point, it would be paying around INR 34,000 per square metre of gross lettable area for the assets.

Logos Mappedu Industrial and Logistics Park spans more than 110,000 square metres of built area on a 218,530 square metre site along the Bangalore-Chennai industrial corridor and is located 52 kilometres (32 miles) from Chennai Port and 49 kilometres from the city’s central business district.

Logos MWC Industrial & Logistics Park yields more than 39,300 square metres of gross lettable area from a 60,702 square metre site in Chennai’s Mahindra World City and Logos Luhari Logistics Estate has 281,000 square metres of GLA on a 497,000 square metre site within an hour’s drive of central Gurgaon and 90 minutes from Indira Gandhi International Airport.

The three properties are among assets spun off by Hong Kong-listed developer and fund manager ESR when the company in July bought out the remaining stake in 13.6 percent stake in Logos Property which it did not yet own from founders Trent Iliffe and John Marsh, after buying out shares held by former Logos’ former Southeast Asia head Stephen Hawkins a month earlier.

ESR had taken majority control of Logos in 2022 when it acquired Singapore’s ARA Asset Management in a $5.2 billion deal.

Following the July transaction, Iliffe established an independent industrial venture involving assets previously developed by Logos in Vietnam and India, according to sources who spoke to Mingtiandi at the time. Those assets encompass Logos’ portfolio in India, which include projects in Pune and Bengaluru, in addition to the three under discussion with Blackstone. The Vietnam assets under Iliffe’s new venture include two near Ho Chi Minh City and a third in Bac Ninh province near Hanoi.

The acquisition of the three India assets may not be the last dealings between Blackstone and Iliffe with the US titan rumoured to be set to work with the Logos co-founder on future opportunities. Earlier this year Logos has indicated that it plans to develop an additional 230,000 square metres of warehouses in India.

Expanding in India

Since Blackstone’s McCarthy made her remarks about India logistics in March, the company has continued to expand its warehouse business on the subcontinent with the company’s Horizon Industrial Parks unit having been selected by the Indian government last month as the lead partner to manage a portfolio of 13 of its last-mile logistics assets.

In April Horizon, which Blackstone assembled in part from assets acquired through its buyout of Warburg Pincus’ Embassy Industrial Parks joint venture in 2021, announced that it had broken ground on Chakan 5, its second logistics park in the city of Pune, near Mumbai.

In June of last year Blackstone agreed to buy out the remaining warehouse business of Mumbai-based Allcargo Logistics adding 511,000 square metres of warehouses to its India portfolio.