May 23 (Bloomberg) -- Blackstone Group LP, the world’s biggest private-equity firm by assets, and Prologis Inc. agreed to buy a portfolio of 17 million square feet (1.6 million square meters) of warehouses for about $960 million, said two people with knowledge of the agreement.
Blackstone, based in New York, and San Francisco-based Prologis will probably complete the acquisition in the third quarter, according to one of the people, who asked not to be named because the transaction isn’t public. The portfolio is 80 percent owned by Lehman Brothers Holdings Inc., with Prologis holding the rest, the other person said.
Blackstone plans to operate about 9.5 million square feet of the warehouses and distribution centers in Reno, Nevada, the people said. Real estate investment trust Prologis will take over the remainder of the properties, which are located mostly in Pennsylvania and Las Vegas, according to the people.
Kim Snyder, president of the southwest region for Prologis, and Kimberly Macleod, a spokeswoman for Lehman, declined to comment on the deal. Peter Rose, a Blackstone spokesman, didn’t respond to a request for comment late yesterday.
Reuters reported the agreement yesterday.
Blackstone has been acquiring warehouses since 2010 in a wager that economic growth coupled with little new construction will make the properties more valuable. With the latest deal, the firm will own about 100 million square feet of industrial space in the U.S. through IndCor Properties Inc., its Chicago-based warehouse unit.
Blackstone also owns about 26 million square feet of logistics properties in Europe through its London-based LogiCor unit, which plans to double its holdings through 2015 as it seeks to profit from rising rents and values, LogiCor Chief Executive Officer Mo Barzegar said in an April interview.
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