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Portfolio > Portfolio Construction

PGIM, NYSTRS Provide $1.1B Loan For Blackstone Acquisition

By Erika Morphy

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Blackstone REIT announced last week that it was acquring an industrial portfolio for $1.8 billion.

PGIM Real Estate Finance and the New York State Teachers’ Retirement System (NYSTRS) have provided $1.1 billion in financing for the acquisition of a 146-property industrial portfolio. A source says this loan is for Blackstone REIT’s $1.8 billion deal that it announced last week.

PGIM Real Estate Finance is a unit of Prudential Financial Inc.

(Related: Blackstone Hires Former Federal Insurance Office Head)

PGIM Real Estate Finance and NYSTRS are co-lenders, with each entity providing $550 million. The properties secured by the seven-year, fixed-rate loan are 20 years old on average, according to the lenders. They have an average finished office space of 10.2%, average lease size of 52,000 square feet, and average clear height of 27 feet.

PGIM was not immediately available to comment.

The portfolio, which is called the Canyon Industrial Portfolio, comprises close to 22 million square feet, with its largest concentrations in Chicago, Dallas, Baltimore-Washington, and Southern California. Among the portfolio’s 327 tenants, there are large concentrations of logistics and e-commerce companies, including Amazon, FedEx, The Home Depot and Coca-Cola.

Blackstone’s prospectus noted that the portfolio has a weighted average remaining lease length of four years with about 16% or less of square footage expiring in a single year and that it has rents that are 6% below market.

— Read Blackstone Is Building Risk Analytics as Part of Insurance Push on ThinkAdvisor.

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