A Single Sale, Blackstone Offloads $4.1 Billion

Recently, private equity giant Blackstone announced that it has agreed to sell three outlet shopping villages in Italy to the French-listed shopping center operator Frey and its capital partner Cale Street for €4.1 billion.

The “Frey Group” is the only listed company in France focused on outlets, with a market capitalization of approximately €1.1 billion. Acquiring this asset will nearly double its managed area.

In a concise two-page press release, Blackstone confirmed the deal in just 28 English words: “Blackstone-managed funds have agreed to sell three Italian outlet villages to Frey Group and Cale Street for €410 million.”

It is understood that this transaction is part of a €6.5 billion European luxury outlet investment framework agreed upon by Frey and Cale Street. “Cale Street” is a European private real estate platform wholly owned by the Kuwait Investment Authority (KIA) and serves as Frey’s “financial backer.” The two established a dedicated €6.5 billion fund in March this year specifically to acquire European luxury outlets.

Prior to the deal, Frey managed five outlet centers with a total area of 220,000 square meters. Post-transaction, this will increase to eight centers with a total area of 400,000 square meters, making it the third-largest in Europe, behind McArthurGlen and VIA Outlets.

The three shopping villages involved in this transaction include Franciacorta Village in the Lombardy region, Valdichiana Village in Tuscany, and Palmanova Village near Trieste. In 2024, these three villages generated a total operating profit of €32 million and attracted approximately 11 million visitors.

After the deal closes, Blackstone will retain ownership of the remaining two shopping villages, Mantova Village and Puglia Village, but their operations will be managed by Frey.

This transaction is part of Blackstone’s effort to optimize its European retail asset portfolio. In 2019, European retail properties accounted for 14% of its total assets under management, a figure that dropped to 8% by 2025.

The data shift indicates a strategic adjustment by Blackstone. Previously, the firm announced plans to deploy $50 billion, focusing on high-growth sectors such as U.S. data centers (IDC) and life science parks.