Key Takeaways
- Ahold Delhaize’s U.S. division has secured a $475 million investment from Blackstone Credit & Insurance for its automated grocery distribution center in Burlington, North Carolina.
- The deal allows Ahold Delhaize USA to preserve cash and reduce risks associated with refinancing, while Blackstone will own the distribution center and cover construction costs.
- The 1 million-square-foot distribution center is expected to cost $860 million to build and will start servicing stores in 2029.
- The facility will employ technology and methods used at an automated site in the Netherlands and will be run through a triple net lease agreement.
- The investment reflects Blackstone’s focus on partnering with leading corporations and providing flexible, low-cost capital.
Introduction to the Deal
Ahold Delhaize’s U.S. division has recently announced a significant deal with Blackstone Credit & Insurance, under which funds managed by Blackstone will invest $475 million in the supermarket operator’s planned automated grocery distribution center in Burlington, North Carolina. This deal is a strategic move by Ahold Delhaize USA to preserve cash and reduce risks associated with refinancing, while also allowing Blackstone to own the distribution center and cover construction costs. The investment is a significant one, with the 1 million-square-foot distribution center expected to cost $860 million to build.
Details of the Agreement
Under the agreement, Blackstone will cover all of the in-scope construction costs for the facility and own the distribution center when it is completed. Ahold Delhaize USA will lease the center for an unspecified amount of time and retain the option to buy the site in the future under pre-agreed terms. The deal allows Ahold Delhaize USA to deploy capital efficiently to advance major infrastructure investments, while also reducing risks associated with refinancing. Construction on the new center is set to begin in early 2026, and the facility is expected to start servicing stores in 2029. The distribution center will be run through a triple net lease agreement, a type of commercial real estate agreement under which a lessee typically pays for rent and utilities as well as insurance, maintenance, and taxes.
Benefits of the Deal
The deal between Ahold Delhaize USA and Blackstone Credit & Insurance is designed to align costs with the benefits the facility will offer over the long-term. The arrangement will allow Ahold Delhaize USA to preserve cash and reduce risks associated with refinancing, while also permitting it to deploy capital efficiently to advance major infrastructure investments. The investment in the distribution center by Blackstone Credit & Insurance reflects that company’s focus on partnering with leading investment grade corporations globally by providing flexible, low-cost capital through its credit and insurance platform. According to Christopher Yonan, head of European infrastructure for Blackstone, the investment is a testament to Blackstone’s commitment to supporting leading corporations and providing them with the capital they need to grow and succeed.
Background and Context
Ahold Delhaize USA has been transitioning to a self-run distribution system to supply its supermarkets, with distribution centers and other facilities located up and down the East Coast. The company announced the plans for the new distribution center in October 2025, with the goal of expanding its ability to distribute fresh and frozen foods to supermarkets in North Carolina under its Food Lion banner. The distribution center will employ technology and methods used at an automated site parent company Ahold Delhaize operates in the Netherlands, which was announced when the company released its third-quarter financial results last November. The investment by Blackstone Credit & Insurance is a significant vote of confidence in Ahold Delhaize USA’s plans and will help the company to achieve its goals of expanding its distribution capabilities and improving its supply chain efficiency.
Conclusion and Future Outlook
In conclusion, the deal between Ahold Delhaize USA and Blackstone Credit & Insurance is a significant one that will help Ahold Delhaize USA to preserve cash and reduce risks associated with refinancing, while also allowing Blackstone to own the distribution center and cover construction costs. The investment is a testament to Blackstone’s focus on partnering with leading corporations and providing them with the capital they need to grow and succeed. With construction on the new center set to begin in early 2026, and the facility expected to start servicing stores in 2029, Ahold Delhaize USA is well on its way to achieving its goals of expanding its distribution capabilities and improving its supply chain efficiency. As the company continues to grow and expand its operations, it will be important to monitor its progress and see how the deal with Blackstone Credit & Insurance contributes to its success.
