Blackstone spends $18.7 billion to become Amazon’s landlord

Blackstone is spending $18.7 billion to buy a network of warehouses. It’s the largest private real estate deal ever and a bet on the continued growth of e-commerce.

The seller is GLP, a global investment manager based in Singapore. Its largest tenant is Amazon, according to its most recent annual report, and FedEx is also among its largest U.S. tenants.

GLP said it is the second-largest owner of U.S. logistics real estate assets with properties across 36 major markets. Warehouse space close to major cities is of increasing importance to e-commerce providers, such as Amazon, and shipping companies, such as FedEx, as they strive to provide next-day or same-day service to customers.

Investment firm Blackstone, which has more than $500 billion in assets under management, will purchase 179 million square feet of space in the United States from GLP in this deal. That is equal to the floor space of more than 27 Pentagon buildings.

Blackstone said logistics is its highest investment priority today. It said the company wants to build on its portfolio to meet growing e-commerce demand. Including this transaction, it has acquired more than 930 million square feet of logistics space globally since 2010.