(Bloomberg) -- Blackstone Inc. is increasing the size of a commercial mortgage bond offering that will help pay for part of its $10 billion acquisition of apartment landlord AIR Communities.
Originally floated as $2 billion, the asset manager told investors the offering is being increased to $2.95 billion and is now slated to be finalized early next week, according to people familiar with the matter. The increase is seen as a sign of strong investor demand for at least some properties within the beleaguered US commercial real estate sector.
A spokesperson for Blackstone declined to comment. Wells Fargo & Co., which is structuring the deal, declined to comment.
The commercial mortgage backed securities will be backed by an additional 10 loans, on top of 19 currently, one of the people said. Blackstone agreed to buy Apartment Income REIT three months ago, and said it will invest over $400 million to maintain and bolster the company’s apartment portfolio.
The increased size stands in contrast with Blackstone’s surprise decision just a month ago to shelve a $1.3 billion CMBS sale backed by more than 60 industrial properties due to spreads that the company deemed too wide.
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