Blackstone sells logistics business in Japan to GIC for $800 million

Blackstone's logistics business in Japan is one of the portfolios GIC is targeting, showing the growth of logistics real estate.

The transaction between Singapore’s sovereign wealth fund GIC and US investment firm Blackstone involves more than 371,000 square metres of warehouse space across Japan, making it one of the largest real estate deals in the country this year, according to data compiled by Refinitiv.

"This merger will further complete the fund's portfolio in Japan. We will continue to focus on the hotel and logistics sectors in the future," said Mr. Goh Chin Kiong, Deputy Director of Real Estate Investment at GIC.

GIC has been increasing its dealmaking with companies recently as Singapore’s interest rates remain low. Last year, the fund made a number of hotel and leisure portfolio deals with Seibu Holdings, despite the global real estate market being under pressure due to a credit crunch. Seibu has nearly 20 years of experience in the hotel and railway sectors in Japan.

A sign outside the Blackstone Group headquarters in New York, USA, January 18. Photo: Jeenah Moon

Daisuke Kitta, head of Blackstone’s real estate business in Japan, said the company has been revamping its real estate portfolio over the past decade, shifting its focus from traditional officetels to logistics properties, data centers and hotels.

"We have secured solid returns through the latest deal, despite the downturn in the property market. That shows how important it is to be selective in selecting projects to acquire and invest in," Kitta told Reuters .

In addition to the projects, Blackstone is still selling logistics properties it owns or acquired about two years ago from Daiwa House Industry Co. Net operating income for the assets, considered a key measure of profitability, rose 35% after it took over management, according to the company.

Blackstone also said that this month alone, they successfully raised $30.4 billion for their latest global real estate fund. The fund currently manages a total of $332 billion in capital from various investment sources.

Can Y (According to Reuters )

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