Blackstone Bets Big on eCommerce Warehouses

Blackstone Bets Big on eCommerce Warehouses

Blackstone Group reportedly is paying $18.7 billion for what Bloomberg calls “179 million square feet of urban logistics properties – the warehouses used by Inc. and other retailers to fulfill orders from online shoppers.”

Blackstone is making the deal with Singapore-based GLP, according to the report. That company stands as the “second-largest owner of U.S. logistics real estate, (and the deal) will almost double Blackstone’s U.S. industrial footprint.”

The move underscores how eCommerce is putting a premium on warehouse and fulfillment space.

“The rise of Amazon and other eCommerce companies has increased the need for warehouse space by retailers seeking to expand their digital operations and cut delivery times,” Bloomberg said. “The shift toward online shopping is reconfiguring supply chains and shaping the fortunes of industrial landlords, with demand especially high in and around large cities, where eCommerce has taken off fastest.”

The Blackstone move follows another recent warehouse deal. Earlier in May, Flexe, a Seattle-based startup that manages an on-demand warehouse marketplace, raised $43 million in a Series B funding round, according to reports. The funding round was led by Activate Capital and Tiger Global Management, with the Seattle VC outfit Redpoint Ventures and others also contributing.

Flexe, which has raised $63.5 million so far, has found a niche that will aid its efforts to wrest marketplace control away from Amazon and provide customers with an alternative to the logistics giant. The company offers software that connects retailers and warehouses with extra space that would otherwise not be used. Flexe’s clients include Staples, Toms, Walmart and P&G. The company also has a network of 1,000 warehouses across the U.S. and Canada, up from 370 three years ago.

Flexe does not sell on Amazon, and instead allows businesses to ship their own branded boxes using their own shipping software, while the warehouses handle the labor and administrative tasks. There is also no data sharing with Amazon, which many companies see as a plus.


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