Tritax Big Box REIT has agreed to acquire a portfolio of logistics assets valued at just under £1.04bn from US private equity firm, Blackstone.

As a result of the deal, Blackstone will become a 9% shareholder in the distribution centre real estate investment trust.

The deal comprises £632m in cash and £375m in new ordinary shares, which represents a 13% premium on Tritax Big Box’s share price on 10 October.

The REIT said that the deal builds on its existing strategy and its ability to deliver “attractive and long-term growing, sustainable returns” for its shareholders.

Tritax Big Box added that it will also increase its urban and small box logistics offering, expanding on locations in the South East and the Midlands.

Chief executive officer at Tritax Big Box, Colin Godfrey, said: "Aligned with our strategic objectives, this exceptional portfolio offers strong rental reversion and numerous asset management opportunities. It also significantly broadens our client proposition across key urban logistics markets and reinforces our leading position in mission critical big boxes; in combination growing our gross asset value to over £7.9bn.

"The acquisition also delivers immediate financial benefits, including mid-single-digit EPS accretion and enhanced returns well above our cost of capital. I welcome Blackstone as a new 8.6%. shareholder in Tritax Big Box; their investment at a material share price premium demonstrates confidence in our team, our leading position in UK logistics, the strong attributes of the transaction and positive outlook for both our business and the market."

The acquisition comes after Blackstone pledged to invest £100bn in Britain over the next decade.

The US private equity firm had previously acquired Warehouse REIT in July for almost £500m after an offer battle with Tritax Big Box.

It has also announced that it is considering making a bid to acquire the UK storage firm, Bug Yellow.

Investment director at AJ Bell, Russ Mould, concluded: "Blackstone won the fight for Warehouse REIT, and it is now doing a deal to sell certain property assets to Tritax in exchange for cash and a stake in the company.

"Tritax further increases its exposure to the UK commercial property space and gets a shareholder with very deep pockets. Blackstone gets its foot in the door with Tritax and would benefit as an investor from its success, as well as being close should the two companies seek to co-invest on projects in the future.

"Blackstone clearly has a strong appetite for UK property as it also confirmed takeover interest in self-storage group Big Yellow. A lot is riding on the Budget as to whether Blackstone will make a formal bid, but throwing its hat into the ring now means it can act fast should Rachel Reeves not announce anything that dampens the appeal of the sector."

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