Prologis, the world’s largest warehouse proprietor, has launched a bid to purchase Blackstone’s portfolio of logistics properties in what could be the biggest ever personal actual property deal, in a sector the place the Covid-19 pandemic and the rise in on-line buying have pushed values up sharply.
Prologis has made a non-binding provide of a bit of over €21bn for Mileway, a portfolio of just about 2,000 European warehouses that Blackstone has been constructing by acquisitions over the previous six years, based on individuals accustomed to the matter.
The corporate now has about six weeks to finalise a bid that satisfies numerous circumstances laid down by the funds promoting Mileway, based on one of many individuals.
Warehouses have been a profitable wager over the previous two years, through which the proportion of gross sales made on-line has surged throughout the continent whereas coronavirus pressured buyers to remain at house.
The disruption to produce chains attributable to the pandemic, the blockage of the Suez Canal by the container ship Ever Given and extra lately Russia’s invasion of Ukraine have additionally led firms to stockpile extra supplies.
Prologis shares are greater than 60 per cent up on their pre-pandemic stage, giving the corporate a market capitalisation of near $120bn.
Blackstone had indicated that it could retain its exposure to the sector final month when it introduced plans to recapitalise Mileway at a €21bn valuation, permitting buyers to shuffle in or out whereas retaining management of the portfolio.
However these plans included a 75-day “go-shop” interval through which greater bidders might put ahead a suggestion. Of 20 or so potential patrons approached by Morgan Stanley, the financial institution managing the method, eight regarded critically at Mileway however solely Prologis submitted a non-binding bid, stated one of many individuals.
Ought to Prologis put ahead a binding provide, the consortium behind the proposed recapitalisation — which incorporates earlier Mileway buyers and numerous Blackstone’s personal funds — might reply with a brand new proposal.
If the Prologis bid, which was first reported by React Information, is profitable, it could give the corporate a dominant place in European “last-mile” amenities — smaller warehouses which serve prospects in cities.
Blackstone and Prologis declined to remark.