By Eva Richardson – The Logistic News
March 21, 2025 – The European commercial mortgage-backed securities (CMBS) market is experiencing a strong resurgence, with Citibank leading the charge through the launch of a landmark £840 million securitisation. This latest transaction, UK Logistics 2025-1 DAC, is secured against Blackstone Real Estate Partners’ extensive logistics portfolio in the UK, highlighting the growing investor confidence in industrial real estate assets.
The Breakdown of Citibank’s Major CMBS Transaction
The securitisation consists of three senior commercial real estate loans originated by Citibank’s London branch:
- Nevis Loan (£360M): Backed by 59 logistics assets, primarily located in London and the South East.
- Fawr Loan (£300M): Secured by 26 logistics and industrial outdoor storage (IOS) properties across the UK, with a 70% concentration in London and the South East.
- Pike Loan (£180M): Supporting 23 logistics assets, valued at £265.35M, with 33% of the portfolio’s worth centered in the South East.
The total collateral spans 8.8 million square feet of standing logistics space and 1.3 million square feet of IOS, emphasizing the critical role of logistics in today’s real estate investment landscape.
CMBS Market Rebounds Amid Growing Demand for Logistics Assets
This deal is part of a broader revival of Europe’s CMBS sector, which has seen a surge in transactions in early 2025, following a period of limited issuance in previous years.
Other notable CMBS transactions this year include:
- Bank of America’s £356.8M securitisation, which supported Lone Star’s UK Project Tiger portfolio acquisition and Henderson Park’s Silverburn shopping centre.
- Carlyle Group’s €259.8M Taurus 2025-1 EU DAC, which securitised a logistics property portfolio.
- Blackstone’s €525M Sequoia Logistics 2025-1 DAC, marking the largest euro-denominated CMBS issuance since 2021.
These transactions underscore the renewed liquidity in real estate credit markets, as institutional investors increasingly turn to CMBS for diversified funding sources.
Blackstone’s Strategy: Reinforcing Logistics as a Key Asset Class
Blackstone has been a major driver in the CMBS resurgence, with three of its four securitisation deals last year involving logistics assets. The strong appetite for industrial properties reflects investor confidence in the sector’s long-term value and resilience.
At the Mipim 2025 real estate conference in Cannes, Gadi Jay, Senior Managing Director at Blackstone, highlighted the positive financing trends within commercial real estate:
“We have seen a material uptick in liquidity for real estate debt across all segments. While some volatility remains, the overall trend is favorable for financing, and CMBS plays a crucial role in ensuring a well-functioning debt market.”
Looking Ahead: A Strong Outlook for CMBS and Logistics Investment
With interest rates declining and investor demand rising, the UK Logistics 2025-1 DAC securitisation is expected to remain a benchmark deal for logistics-backed CMBS. The transaction is structured for full repayment by May 2030, demonstrating confidence in the long-term strength of the logistics sector.
As institutional capital continues to flow into industrial assets, experts anticipate further growth in CMBS activity, with logistics remaining one of the most sought-after asset classes in real estate finance.
For the latest updates on logistics finance, commercial real estate trends, and CMBS market developments, stay connected with The Logistic News.
Eva Richardson
Senior Journalist, The Logistic News
