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Blackstone to buy Gramercy for $7.6B

Blackstone, the worldʼs biggest alternative asset manager, will buy real estate investment trust Gramercy Property Trust Partners for $7.6 billion, the company announced Monday.

The trade will be made at $27.50 per share in a move Gramercy CEO Gordon DuGan called validation of the company’s platform.

Since its founding in 2004, Gramercy has built a portfolio of 70 million square feet of industrial property.

“We are pleased to acquire Gramercy and its strong portfolio of assets,” said Tyler Henritze, head of US real estate acquisitions for Blackstone.

The move reinforces Blackstoneʼs commitment to the industrial sector as it rides a popularity wave driven in large part by the e-commerce sector. Matt Kopsky, an equity analyst with Edward Jones, said, “It does seem to be a good deal for Gramercy Property Trust. Their growth engine is to acquire other industrial properties and the hard part of that is industrial assets are priced extremely rich and its difficult to continue that.”

Kopsky said that since Gramercy positioned itself with strong investments in industrial properties, it was ripe for a company such as Blackstone to pick them up.

He added that Blackstone is continuing its momentum in industrial real estate as it also recently bought out Vancouver-based Pure Industrial Real Estate Trust in January for $3.8 billion and the industrial properties of Boston-based Cabot Properties in December for $1.8 billion.

Morgan Stanley acted as financial advisor to Gramercy and Citigroup and BofA Merril Lynch advised Blackstone.

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