U.S. investment giant Blackstone has increased its offer to acquire UK-based Warehouse REIT, proposing 115 pence per share, including an interim dividend of 1.6 pence. The revised bid values the deal at approximately £489 million, or around €570 million, surpassing the previous competing offer from Tritax Big Box REIT, which stood at 114.2 pence per share.
Following the improved offer, the board of Warehouse REIT, which had initially backed the merger with Tritax, has now unanimously recommended Blackstone’s proposal to shareholders. This significantly raises the likelihood that the American private equity firm will secure control of the logistics-focused real estate investment trust.
Blackstone’s proposal is structured as an all-cash deal, eliminating the uncertainties often associated with share-based transactions. In addition, Blackstone has already amassed a 13.8% stake in Warehouse REIT, further demonstrating its commitment to the acquisition.
Market Context: Logistics Sector Remains Resilient
Logistics continues to be one of the most resilient sectors in the real estate market amid broader economic volatility. The sustained growth of e-commerce and the restructuring of supply chains have fueled ongoing demand for warehouse space. Analysts estimate that logistics assets in the UK currently yield between 4% and 5%, with some regional assets yielding over 5.5%.
Warehouse REIT, with its focus on urban last-mile logistics assets, is viewed as a high-quality investment with stable rental income. These characteristics make it particularly attractive to institutional investors seeking long-term returns and portfolio diversification.
Deal Structure and Shareholder Benefits
Blackstone’s offer of 115 pence per share includes:
– A premium of approximately 8.3% over the share price as of June 3
– A premium of around 34% compared to end-of-February prices
– Entitlement to a 1.6 pence interim dividend
– A full-cash transaction with no share swap involved
Compared to Tritax’s offer, which included a share exchange component, Blackstone’s cash-only bid provides immediate liquidity and certainty to shareholders, making it more appealing in the current market climate.
Market Reaction and Board Commentary
The market responded positively to the news, with Warehouse REIT’s share price increasing on the announcement. The company’s board stated that Blackstone’s bid “represents the best available alternative for shareholders” and “delivers immediate value with a high degree of certainty.”
Industry experts view the move as a reflection of rising interest from private capital in undervalued public real estate vehicles, particularly REITs trading at significant discounts to their net asset values (NAVs).
Strategic Implications for the Sector
If completed, the deal would be one of the largest logistics real estate transactions in the UK in 2025. It may also set a precedent for other REITs considering delisting, especially those facing high capital costs and limited access to traditional financing sources.
For Blackstone, acquiring Warehouse REIT fits into a broader European strategy. The firm has already invested over €1 billion in logistics assets across Germany, France, and the Netherlands. Adding Warehouse REIT would solidify its footprint in the UK, one of the most active and liquid logistics markets in Europe.
Remaining Risks and Next Steps
The transaction is contingent on shareholder approval, requiring support from more than 50% of voting shareholders. The acceptance deadline is set for early September 2025. While there is still a possibility that Tritax or another bidder may return with an improved offer, analysts see this as increasingly unlikely.
There may also be regulatory scrutiny from UK competition authorities, although real estate transactions of this nature typically clear without major obstacles.
Conclusion
Blackstone’s revised €570 million offer underscores the strategic importance of Warehouse REIT and the continued strength of the logistics real estate sector. If approved, the deal will bolster Blackstone’s UK presence and reinforce a broader trend of public-to-private transitions in real estate. For investors, the acquisition sends a strong signal that logistics remains a dependable and attractive asset class within the European property market.
