Blackstone To Repay £2.5B Of Debt As Part of Giant £6.4B Logistics Refinancing

Blackstone is set to repay £2.5B ($3.2B) of debt as part of a huge refinancing of its European urban logistics portfolio. 

Notices posted this week to investors in five loans secured against assets of Blackstone's Mileway logistics platform say that the loans will be repaid because the owner is in the final stages of refinancing the portfolio. 

The securitised loans total £2.5B and were originally issued by banks, including Bank of America and Morgan Stanley, and then sold to investors. 

Mileway is one of the largest logistics owners in Europe, with more than 1,700 properties totalling more than 160M SF in more than 100 cities across 10 countries. 

In December, CoStar reported that Blackstone was undertaking a huge refinancing of the business’ debt. It has since arranged new debt facilities totalling £6.4B ($8.1B) from a phalanx of banks: Bank of America, Barclays, BNP Paribas, Deutsche Bank, Goldman Sachs, JPMorgan, Morgan Stanley, Royal Bank of Canada and SMBC.

CoStar said the debt reflects about three-quarters of Mileway’s loans, has a margin of about 250 basis points and is at around 50% loan-to-value. 

The size of the refinancing at a time lenders are exercising extreme caution highlights Blackstone’s clout in the market and the fact that logistics is seen as a resilient asset class. 

Blackstone created Mileway by snapping up portfolios of light industrial and urban logistics assets across Europe between 2017 and 2022 for its opportunity funds. It recapitalised the business in 2022, spinning it into a new company that doesn’t have the fixed termination dates of funds. GIC is among the investors in the new vehicle. 

That recapitalisation was undertaken at a valuation of about £18B, and the refinancing values Mileway at about the same level, CoStar said.