Blackstone plans $635m debt sale linked to UK warehouses

Blackstone is preparing to sell up to £500 million (US$635 million) in debt tied to UK warehouses, according to people familiar with the plan.

The sale, expected as early as September, would involve commercial mortgage-backed securities using properties managed by Indurent, Blackstone’s logistics and industrial platform formed in 2024.

Indurent’s assets include St. Modwen Logistics and Industrials REIT, spanning over 30 million square feet across the UK.

The move follows a recent revival in the European CMBS market, with Blackstone completing a £1.5 billion (US$1.91 billion) deal for UK holiday parks in August.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ European CMBS market recovery follows predictable post-crisis pattern

Blackstone’s timing reflects the broader European CMBS market’s emergence from a prolonged downturn that bottomed out during the pandemic years.

The market showed clear recovery signals in 2021 when 16 CMBS deals were originated totaling £2.601 billion in GBP-denominated deals, representing an increase of 10 deals compared to 20202.

This revival pattern mirrors previous CMBS market cycles, where institutional investors like Blackstone strategically time major issuances during recovery phases when investor appetite returns but before competition intensifies.

Blackstone’s recent £1.5 billion Haven deal last month demonstrates the firm’s confidence that European CMBS demand has sustainably recovered from what the market described as “torpid years”1.

The scale of their planned £500 million logistics-focused deal suggests they’re positioning to capture this recovery window while logistics assets remain in high demand.

2️⃣ Logistics real estate emerges as institutional investors’ defensive play amid sector divergence

The focus on warehouse and logistics assets reflects a strategic shift as commercial real estate fundamentals diverge dramatically across property types.

While 88% of global commercial real estate executives expect revenue increases in 2025—up from just 60% previously—the industrial sector stands out as a consistently strong performer while office properties face persistent challenges3.

This divergence creates clear winners and losers, with logistics benefiting from structural demand driven by e-commerce growth while office properties struggle with high vacancy rates.