- Blackstone bumped its CMBS offering from $2B to $2.95B to finance its $10B acquisition of AIR Communities.
- The massive multifamily deal would be Blackstone’s biggest ever, and includes 27K+ units in 10 states, with 30% in California.
- Blackstone plans to spend $400M on property maintenance and improvements, with potential future investments.
According to Bloomberg, Blackstone (BX) has raised its commercial mortgage bond offering to $2.95B to help pay for its $10B acquisition of multifamily owner AIR Communities (AIRC). The CMBS bond offering was initially set at $2B.
Deal Details
The historic acquisition marks Blackstone’s largest multifamily acquisition to date, as reported on The Real Deal. Over 27K apartments across 10 states, with about 30% located in California, will be rolled into Blackstone’s CRE empire.
The acquisition is expected to close in Q3. Blackstone has committed to spending $400M to maintain and improve AIR’s properties, with the possibility of additional investments in the future.
Nadeem Meghji, Blackstone’s global real estate co-head, described the deal as the “highest-quality, large-scale apartment portfolio we have ever acquired,” emphasizing the strong multifamily fundamentals in the markets where the properties are located.
Behind The Scenes
Wells Fargo (WFC) is structuring Blackstone’s revised $2.95B CMBS bond deal.
Notably, Blackrock withdrew from a $1.3B CMBS sale backed by CRE debt last month. And earlier this year, Blackstone secured a $308.5M refinancing deal on a Park Avenue Tower.
Morgan Stanley (MS) originated that loan and packaged it into commercial mortgage-backed securities, replacing a $425M CMBS loan from 2019.
Too Big to Fail
The bigger bond offering and historic acquisition underscore Blackstone’s high confidence in the U.S. multifamily market and the firm’s ability to continue attracting investor interest despite recent BREIT setbacks.
