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Blackstone doubles down on BioMed

Blackstone is extending its big bet on biotech and other life-science buildings. The firm said it looked at selling or taking public BioMed Realty Trust, the second-largest U.S. owner of life-science buildings with 93 properties, which Blackstone acquired in 2016, according to the Wall Street Journal.

  • Be Smart: Fund investors said they wanted to continue owning BioMed rather than cashing out. So the private equity giant ultimately agreed to sell it to another Blackstone fund that can hold it indefinitely and enable investors to stay in. 
  • Flashback: The sale price of $14.6 billion amounts to about a $6.5 billion gain in value from the 2016 purchase. To ensure this represented a fair price for buyer and seller, Blackstone consulted outside advisers to determine the value. Morgan Stanley will also solicit bids on BioMed to determine whether a higher offer exists.
  • Trends: A recent CBRE research report showed a 6.1% average vacancy rate for the 13 largest life-sciences markets at the end of the second quarter, compared with an office-vacancy rate nearly double that in those markets. [WSJ]

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