US-based private equity firm Blackstone has raised $20.5 billion in its real estate fund. The fund known as Blackstone Real Estate Partners IX (BREP IX) is the largest ever commercial real estate fund. The fund is built to invest in properties worldwide, the media reported.
The fund has already made its first investment with the purchase of Singapore-based Global Logistics Providers’ US industrial warehouse properties. The offer was made for $18.7 billion, including $8 billion debt.
It outbid Prologis with the purchase offer. Prologis is a logistics real estate company based in San Francisco. The Wall Street Journal reported that it is the biggest private real estate transaction.
The warehouse purchase comprises 1,300 properties sprawling across 180 million square feet of space. With that, Blackstone will become one of the largest owners of US logistics properties.
The company has made the fund possible despite tough market conditions. Blackstone is the world’s top real estate fundraiser. Its real estate assets under management reached $153.6 billion in the second quarter, WSJ reported. Blackstone plans to divide the portfolio, with two-thirds directed toward real estate strategy and the remainder in a private real estate investment fund.
A part of the company’s real estate strategy is to focus on industrial property as online shopping market is exponentially growing.
Investors seeking higher returns and away from public markets are showing significant interest in Blackstone. Financial data and information provider Preqin found that the capital ready to be invested has reached more than $2 trillion.