Blackstone set to become biggest warehouse landlord

US-based private equity major Blackstone Group is set to acquire Embassy Industrial Parks at an enterprise valuation of Rs.52.50 billion from Embassy Group and Warburg Pincus in the largest-ever warehousing and logistics deal in India. Blackstone will become the country's largest warehousing space landlord with over 40 million sq ft of logistic parks in assets with this complete buyout transaction.

The Blackstone Group, already India's largest office space landlord, is set to become the biggest retail assets owner, too, with the conclusion of its 

$1.5 billion deal with Prestige Group.

Embassy Industrial Parks, a 70-30 JV between Embassy and Warburg Pincus, has 22 million sq ft of assets, while Blackstone already has 18 million sq ft of warehousing assets in its portfolio through its stake buys in Allcargo Logistics warehousing assets and Hiranandani Group. Of the total 22 million sq ft of assets of Embassy Industrial Parks, 3.5 million sq ft area has been built and leased to clients, including Myntra, Amazon, Mahindra Logistics, Firstcry, Delhivery and Rhenus Logistics among others. Embassy Industrial Parks has warehouses in Chakan in Pune, Sriperumbudur and Hosur in Tamil Nadu, Farrukhnagar and Bilaspur in Delhi-NCR and Kothur in Hyderabad. It also owns land in Bengaluru.

The government's decision to accord infrastructure status to the logistics industry allows developers access to low-cost funds for development. Given the fundamental shifts across the logistics sector in the past few years and the rising demand for quality space, more developers are likely to build compliant, large-sized spaces.