Deals

Blackstone sells life science properties for $1.5bn

The private equity giant is exiting 25 properties it acquired with capital from its eighth global opportunistic fund.

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The Blackstone Group has sold 25 life science and medical properties to a real estate investment trust for $1.5 billion, the private equity giant announced on Tuesday.

Chicago-based Ventas will acquire the assets of Wexford Science & Technology, a company acquired by BioMed Realty Trust in 2013, for $640 million. Blackstone bought BioMed Realty in January for $4.8 billion with capital from Blackstone Real Estate Partners (BREP) VIII, its $15.8 billion opportunistic fund.

Ventas will take over 23 properties and two development sites across the United States in an agreement that also allows the REIT to exclusively develop future projects with Wexford. Tenants at the sites across the country include Yale University, Washington University in St. Louis and Alexion Pharmaceuticals.

The transaction is expected to close in the fourth quarter, according to the Tuesday announcement. Wexford will continue to manage the properties.

Blackstone could not be reached for comment on the sale. The firm’s eighth opportunistic fund closed in October. On Friday, PERE reported that Blackstone purchased more than $1 billion of West Coast office buildings from Hines with capital from the fund. Other acquisitions from BREP VIII include a 49-property US retail portfolio purchased in December from RioCan Real Estate Investment Trust for C$2.7 billion ($1.9 billion; €1.9 billion) and the $2 billion acquisition of a 10,399-unit apartment portfolio in November from Greystar Real Estate Partners.

Nearly all of the capital in BREP VIII – which is the largest closed-end property vehicle ever raised – comes from US and foreign investors that had previously participated in Blackstone's real estate funds. These limited partners included the Teachers' Retirement System of the State of Illinois, the Pennsylvania Public School Employees' Retirement System, the Teacher Retirement System of Texas, New York State Common Retirement Fund, each of which allocated $300 million to the vehicle, according to PERE research.