Warehousing and logistics development in India is increasing due to rising consumption led by demographics, proliferation of e-commerce and supportive government regulatory initiatives.
The Blackstone Group is banking on this development area and hopes to expand its warehouse portfolio in India by 2.5 times from the current 40 million square feet to 100 million square feet in the next three to five years.
The Group will further develop its logistics portfolio through existing joint ventures and partnerships and will also forge new alliances for this purpose.
“India’s demographics and consumption patterns, along with promising economic growth prospects, undoubtedly point to a major opportunity for logistics, warehousing and industrial space. “The Government’s holistic approach to transforming the logistics sector will ensure solid growth potential,” said Asheesh Mohta, Blackstone’s chief operating officer and head of real estate acquisitions in India.
Blackstone announced the final closing of the largest-ever $30.4 billion real estate drawdown fund in April.
A significant portion of these funds are slated to go to logistics and data centers, as well as geographically to the Asia-Pacific region, particularly India.
An alliance with the real estate group Hiranandani Group already exists for the GreenBase Industrial & Logistics Park. As part of the alliance, the two have jointly pledged over Rs.3,000 crore to invest in the development of industrial and logistic parks in key cities in India.
According to Mohta, Blackstone will continue to expand its logistics presence in major urban centers in India, backed by its global logistics experience and exceptional managerial skills.
Blackstone recently launched a separate platform for India, Horizon Industrial Parks, to house its 26 million square foot logistics and warehousing facilities and to support its rapidly expanding logistics footprint across the country.
Created through recent key acquisitions including Embassy Industrial Parks, TARC and Allcargo Logistics for over half a billion dollars in investments, the platform will act as the holding company for all of Blackstone’s logistics and industrial park assets and alliances.
Blackstone’s logistics portfolio in major Indian cities including Bengaluru, Delhi-NCR, Pune and Hyderabad is anchored by tenants in fast-growing sectors such as e-commerce, retail, automotive and logistics.
Blackstone is one of the largest owners of storage space in the world. The company has invested over $55 billion in this segment to date and has more than 575 million square feet of warehouse space worldwide.
It has already built high-quality logistics platforms around the world. These include Milestone in Australia, which the company sold last year in the country’s largest private property transaction; Mileway, the largest owner of last mile logistics facilities in Europe; and DragonCor in China, which ranks among the top five logistics portfolios in the country.
Now the group is moving swiftly to build a large portfolio in India as it has advanced discussions to acquire and build storage facilities here.
Blackstone has grown to own India’s largest office property portfolio and is now targeting the country’s burgeoning warehousing and logistics sector.
India’s logistics and warehousing sector has been on a transformative growth trajectory since the introduction of the Goods and Services Tax (GST) and the advent of e-commerce. In addition, the center’s decision to grant industry status to the industry allows developers access to low-cost funds for development.
Given the fundamental changes in the industrial and logistics sectors and the growing demand for high-quality space, developers are more likely to build compliant, large-scale spaces.