(Bloomberg) -- Blackstone Group Inc. is expanding its industrial real estate holdings, snapping up more than a dozen facilities in a deal with Iron Mountain Inc.
The $358 million transaction includes 13 properties located mainly in California, northern New Jersey and Pennsylvania’s Lehigh Valley, according to a statement Thursday.
Iron Mountain, which provides records storage and secure document disposal for companies, agreed to lease back the buildings and plans to use proceeds of the sale to invest in its faster-growing businesses, including data centers.
Even before the pandemic, Blackstone had wagered billions of dollars on industrial real estate, betting that the rise of e-commerce would bolster demand for warehouses. That strategy has paid off this year as more shopping moved online.
As e-commerce flourishes, investors have poured money into warehouses, particularly as the pandemic batters hotels and retail property. Blackstone’s latest deal shows the private equity giant is sticking with the sector, even as prices for industrial properties soar.
“Fundamentally, this transaction to us is about buying great real estate in very strong industrial markets,” Nadeem Meghji, Blackstone’s head of real estate in the Americas, said in an interview. “First and foremost, we’re focused on location and asset quality. We believe these are good assets to own.”
The buildings total 2.1 million square feet (195,000 square meters) and are being purchased by Blackstone’s nontraded real estate investment trust, BREIT.
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