Blackstone bets another $1.1bn on Greater Bay Area

Guangzhou International Airport R&F Integrated Logistics ParkMajor alternative investments manager Blackstone Group this week increased its Chinese logistics portfolio by one third and acquired a 70% stake in a 1.2 million m² logistics park in the fast-growing Greater Bay Area. Guangzhou International Airport R&F Integrated Logistics Park is located 15 kilometres from the city’s international airport and is already home to e-commerce majors Tmall (part of the Alibaba Group) and JD.com. Logistics providers SF Express and YTO Express are also tenants, as are several top-tier mainland corporates including China Mobile, China Unicom, Sinopharm and China Resources Pharma.

A sprawling port city northwest of Hong Kong on the banks of the Pearl River, Guanzhou is the most populous city in Guandong province and Beijing has high hopes that it will play a key role in its plans to use the Guangdong-Hong Kong-Macao Greater Bay Area to drive China’s innovation-driven development. So far, it seems, so good; by the end of 2019, the 56,000km2 ‘megapolis’ was home to more than 72 million people and had a combined GDP of $1.7bn. GDP per capita stood at $23.4k.

Pearl River Delta/Greater Bay Area “The Greater Bay Area is rapidly emerging as a financial, technology and transportation hub and one of China’s biggest logistics markets,” said Cliff Chen, a Blackstone managing director based in Shanghai.

The park was previously owned, developed and operated by Guangzhou R&F Properties and currently consists of 900,000 m² of rentable warehouses, plants and cold storage. Blackstone’s resources will enable it to drive plans for the park’s future growth, including additional cold storage facilities and “institutional-quality warehouses to cater for rising demand”, Chen added.

News of the acquisition came just days after it emerged that the Blackstone Group was simultaneously looking to raise in excess of $5 billion for a second private equity fund focused on Asia. The group closed its first Asian private equity fund at about $2.3 billion in 2018 and is said to have already started marketing the new vehicle to potential investors.

Blackstone is also one of several US private equity firms that Indonesia has invited to take part in a new sovereign wealth fund as it tests the investment waters afterJakarta passed sweeping reforms last month. It is now looking to boost foreign investment and counter the impact of coronavirus, which has almost brought south-east Asia’s largest economy to its knees.