As we all know, the world is increasingly moving online. The places we once used to visit in person, be it shops or restaurants, are seeing their physical sites replaced by virtual ones, and nothing seems to demonstrate this more than the empty buildings lining Europe's high streets. While many may not view it in a positive light, private equity giant
Blackstone is betting—and hoping—that this trend continues.
The US-based investor has just launched a pan-European last-mile logistics real estate company, Mileway, worth a reported €8 billion (around $8.8 billion). Headquartered in Amsterdam, the entity incorporates around 1,000 assets that have been acquired by the firm's real estate funds and is said to be the largest of its kind on the continent. It will be run by former fund director of the €3.5 billion Goodman European Logistics Fund, Emmanuel Van der Stichele, and its properties total over 9 million square meters mainly located within and around major European cities.
The creation of Mileway comes roughly two years after Blackstone sold its previous pan-European logistics company,
China Investment Corporation for €12.25 billion. The company was founded by Blackstone's real estate division in 2012 to manage and operate its European logistics assets. If Mileway follows a similar path, this is likely the first step in a plan to sell it at a future date.
It might seem a little redundant to sell one logistics company only to recreate another, but there is one key difference between the two: Mileway's focus on last-mile logistics. When bricks and mortar dominated retail, a product could take weeks to arrive at a customer's door, but with the explosion of online sales and the increase in urbanization, fast delivery is expected. The fact that Mileway already owns and plans to buy up more properties to capitalize on this ecommerce trend indicates an opportunity for Blackstone to pursue further growth.
It helps that the assets are reportedly being used by the likes of
Amazon and food delivery companies such as
Deliveroo, which have been opening so-called "dark kitchens" to eliminate the need for physical restaurants. With assets spanning the UK, Germany, France, Spain, the Netherlands and the Nordics, Blackstone is well positioned to reach customers by the masses.
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