Morgan Stanley and Deutsche Bank are preparing to launch a commercial mortgage bank securitisation backed by some of the logistics properties Blackstone bought when it took over Warehouse REIT, CoStar News can reveal.
The year is ending as it begun, with US private equity giant Blackstone powering a notable increase in European CMBS transactions.
A filing for "Project Wapping", in relation to a commercial mortgage loan secured against commercial leases on UK logistics assets, has been lodged following the publication of an engagement letter dated the end of October.
Deutsche Bank is the loan seller, risk retention holder and arranger while Morgan Stanley is loan seller and risk retention holder. The loan was completed for a portfolio of commercial leases at 31 August 2025.
The properties either include the entire estate or units at: Midpoint 18 in Middlewich, the largest asset in the Warehouse REIT portfolio; Gateway Park, Birmingham; Daneshill Industrial Estate, Basingstoke; Linkway Industrial Estate, Middleton; Rycote M40, east of Oxford; Boulevard Industrial Park in Liverpool; Murcar Industrial Estate in Aberdeen; Ventura Park in Tamworth; Oldbury Point in West Bromwich; Birkenshaw Retail Park, Glasgow; Wakefield 41 Industrial Estate; Stadium Industrial Estate in Luton; South Gyle Industrial Estate in Edinburgh and Queenslie Park in Glasgow.
Blackstone's takeover of listed UK multilet industrial investor Warehouse REIT was declared unconditional in September. The group's offer at 113.4 pence per share in cash and Warehouse REIT's fourth interim dividend of 1.6 pence per share valued the real estate investment trust's share capital at approximately £489 million.
Warehouse REIT was focused on the multilet sector across the United Kingdom. Its portfolio was valued at £810.2 million across 69 estates with a rent roll of £44.6 million at the time of the acquisition.
This year's increase in CMBS activity in the UK and Europe fits in with a wider picture of an increasingly diverse and active financing market for commercial real estate in 2025. Blackstone has been the driving force behind the pick-up in activity as sponsor, with a particular focus on its logistics assets in the UK.
In October UK Logistics 2025-2 DAC, a £507 million Blackstone-sponsored CMBS, collateralised by 114 of its Indurent platform's logistics assets, priced. The securitised loan was sold by Natixis and Société Générale. One hundred and two of the assets are freehold and 12 of which are leasehold interests. The properties are mostly linked to ecommerce, and comprise 9.2 million square feet across the country.
The final pricing was a weighted average margin of 199 basis points, which is 44 basis points less than Blackstone’s UK Logistics 2025-1, which priced in April, and nine basis points tighter than UK Logistics 2024-2, which priced in November 2024.
The only keener pricing in Europe in the past four-and-a-half years was Blackstone's first European CMBS of the year, the €525 million Sequoia Logistics 2025-1 DAC. At the time that was the largest euro-denominated issuance CMBS since 2021, and priced at a weighted average margin of 192 basis points, as reported.
In the first three quarters of the year, European CMBS issuance totalled €6.2 billion across 11 transactions, 68% of which were sponsored by Blackstone, compared with four deals and a €1.6 billion issuance volume in 2024.
Blackstone declined to comment.