Blackstone launches €8b logistics arm to become Europe's last-mile king

Two years after divesting its logistics platform Logicor for a record €12.25 bn to China Investment Corporation (CIC), private equity giant Blackstone has launched a pan-European last mile logistics company called Mileway.

According to Blackstone, the new company operates approximately 1,000 logistics assets that have been acquired by real estate funds managed by Blackstone over the last few years. Media reports price its portfolio at around €8 bn.

Mileway’s logistics properties, which are predominantly located within and around major European cities serving last mile needs, total more than 9 million m2, making it the largest last mile player in Europe.

Blackstone said that the portfolio spans urban centres across Europe’s largest economies, including the UK, Germany, France, Spain, the Netherlands and the Nordics. The company will continue to expand its portfolio in existing and new markets.

Emmanuel Van der Stichele has been appointed chief executive of Mileway.

'Mileway is a natural evolution of our European logistics strategy, which is one of our highest conviction, long-term investment themes,' said James Seppala, head of Blackstone Real Estate Europe.

'As the largest last mile logistics real estate company in Europe, Mileway will meet growing e-commerce-related demand for last mile logistics real estate, facilitate faster delivery times and support the growth of small and large businesses,' Seppala added.

'The growth of e-commerce and urbanisation is intensifying the requirement for faster logistics solutions. Mileway is the number one gateway to urban markets, and we are uniquely positioned to help businesses shorten delivery times, grow their customer base and scale geographically,' said Van der Stichele.

Logistics experience
Van der Stichele was previously fund director of the Goodman European logistics fund, one of the largest European non-listed logistics funds with approximately €3.5 bn of assets under management. Dominiek Van Oost has been appointed chief operating officer and Thomas ten Bokum will start as the new head of investment and portfolio management in October 2019.

The launch follows signs of Blackstone's accelerating interest in the global logistics sector. Since 2010, Blackstone has acquired nearly 1 billion ft2 of logistics around the world.

Logicor was founded by Blackstone's real estate division in 2012 to manage and operate its European logistics assets. By June 2017, the platform was operating over 630 properties, when Blackstone found a buyer in the shape of China's sovereign wealth fund.

However, the private equity giant's exit wasn't absolute. Blackstone bought back 10% of Logicor from CIC six months after the sale, and CIC also hired the US private equity firm to manage Logicor's warehouses and logistics property portfolio.

Renewed interest
Blackstone has continued to amass logistics portfolios in the last two years, with a focus on the burgeoning last mile sector.

A couple of months before unveiling the CIC deal, the firm inked a €1.28 bn deal with UK REIT Hansteen to acquire the firm's entire German and Dutch light-industrial portfolio, in joint venture with M7 Real Estate.

In January 2018, Blackstone secured a portfolio of European logistics properties from Goodman Group for €600 mln.

However months later, the private equity giant missed out on securing Gramercy Europe's extensive shed portfolio, when Clarion Partners clinched a takeover deal for the London-headquartered firm.

In May 2018, Blackstone had announced that it was buying the New York-listed Gramercy Property Trust (GPT), of which Gramercy Europe was part. The complex GPT agreement took until October to close, by which time Gramercy CEO Alistair Calvert and his team had simultaneously negotiated a management buyout for Gramercy Europe, a deal which closed on 4 October 2018. Weeks later, Gramercy Europe struck a deal with Clarion.

Blackstone's logistics operations in Europe are still dwarfed by its US platform, which acquired a portfolio of logistics assets from Singapore's GLP for $18.7 bn (€17 bn) this summer, nearly doubling the size of Blackstone's US industrial footprint to around $35 bn.


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