Blackstone Turns a Warehouse Into a Home

Yesterday we mentioned that PE firm Blackstone bought the U.S. warehouse portfolio of Singapore’s GLP in the largest private real estate transaction in history.

So why did Blackstone pay $18.7 billion for a bunch of empty boxes? It’s a question that could really derail your day, until you return home to 10 packages outside your door and think, “okay that makes sense.”

A bet on warehousing is a bet on online shopping.

• Both Amazon and Walmart recently announced plans to offer one-day shipping, and establishing warehouses close to population centers is critical to that effort.
• E-commerce sales are still climbing, up 3.6% in the first quarter from a quarter earlier.

Zoom out: When the global co-head of Blackstone real estate said logistics is the firm’s “highest conviction global investment theme today,” he’s not kidding. The company just added roughly 1,300 properties and 179 million square feet to nearly 2x its existing U.S. industrial footprint.