A Blackstone property fund is buying back a 10 percent stake in European warehouse platform Logicor, which the private equity giant sold to China Investment Corporation (CIC) for $13.8 billion earlier this year, according to a news report.
CIC, China’s sovereign wealth fund with over $813 billion in assets under management, also hired Blackstone to manage the 17-country, 13.6 million square metre logistics portfolio, the Financial Times reported, citing people briefed on the matter.
New York-based Blackstone is acquiring the stake through a newly raised $2 billion European real estate fund. Besides the Blackstone vehicle, CIC has invited a number of investors to buy into Logicor, and several insurers are said to be eyeing the company.
CIC Sheds Stakes in European Warehouse Platform
Logicor bills itself as Europe’s largest directly-owned network of logistics assets, with a portfolio of strategically-located warehouses across the continent. CIC’s purchase of the company from a set of Blackstone-controlled funds, confirmed in early June, marked one of the biggest real estate deals in history.
Last month, CIC appeared to reshuffle its ownership of Logicor by agreeing to sell a 10 percent stake in the platform to a subsidiary of mainland reinsurance heavyweight China Reinsurance Group (China Re) for 579 million euros ($671 million). China Re is majority owned by Central Huijin Investment Co, a subsidiary of CIC.
The stock exchange filing announcing the deal notes that the portfolio comprises more than 600 assets, with an average occupancy rate of over 93 percent as of the end of June.
Blackstone Continues Logistics Love Affair
Blackstone’s real estate arm, which has around $111 billion in assets under management worldwide, has emerged as a major buyer and seller of warehouses and distribution centres globally over the past decade, as the rapid growth of online retail has driven rising values for logistics space.
In early 2015, the alternative investment manager sold its US logistics business, IndCor Properties, to a consortium of Singapore-based warehouse builder Global Logistic Properties (GLP) and Singapore’s sovereign wealth fund for $8.1 billion. And less than two months ago, Blackstone bought a 4 million square foot (371,612 square metre) logistics and industrial portfolio in southern California from Principal Real Estate Investors for $500 million.
Blackstone, which is chaired by billionaire Stephen Schwarzman, closed its fifth opportunistic fund targetting European real estate in June, the $8.79 billion Blackstone Real Estate Partners Europe V (BREP Europe V).