Singapore's GIC buys IndCor Properties for US$8.1 billion

Singapore's sovereign wealth fund GIC agreed to buy IndCor Properties from Blackstone Group for US$8.1 billion, expanding in the US market for industrial real estate.

The purchase is expected to close in the first quarter, Blackstone said in a statement yesterday. The agreement ends the prospect of an initial public offering for IndCor, which had been planning a share sale valuing the company at about US$8 billion, people with knowledge of the matter said in August.

GIC is gaining warehouses across the United States as demand for industrial space climbs from online retailers and other customers. Chicago-based IndCor owns about 117 million sq ft of buildings in 29 markets. For Blackstone, the deal allows it to exit a major investment at a profit as it invests in a new series of property funds.

"We built IndCor through 18 acquisitions to be one of the largest industrial real estate companies in the United States," Tim Beaudin, chief executive of IndCor, said in the statement. "We are excited about the company's future prospects under new long-term ownership with GIC."

Blackstone started building IndCor in 2010, when the plunge in property values after the financial crisis created opportunities to acquire assets from distressed sellers. Industrial real estate prices in major markets have rebounded from the crash and are within 5 per cent of their pre-crisis peak, Moody's Investors Service said in a report last month.

GIC, which has been acquiring real estate worldwide, has branched out from prime office towers in major cities. In September, a GIC affiliate and two Canadian pension funds invested US$700 million in XPO Logistics, a provider of services including airfreight forwarding and warehousing management that is based in Greenwich, Connecticut.