- Blackstone Real Estate Debt Strategies will buy up to $869M in performing single-tenant lease financing loans from First Internet Bancorp, with closing expected on September 18, 2025.
- The sale will boost First Internet Bancorp’s capital ratios, reduce fixed-rate exposure, and improve earnings resilience in shifting interest rate environments.
- For Blackstone, the deal expands its net lease strategy, which now represents about 5% of its real estate portfolio alongside multifamily, industrial, and data center holdings.
A Milestone Sale
According to Globe St, First Internet Bancorp struck a deal to sell $869M in performing net lease financing loans to Blackstone Real Estate Debt Strategies. The loans will trade at about 95% of their unpaid principal balances, reflecting transaction costs. Importantly, the Indiana-based bank will still service the loans and maintain borrower relationships.
The transaction should close in mid-September. Once finalized, it will allow First Internet to move about $550M in deposit balances off its books and strengthen its capital position.
Strategic Shift For First Internet
Chairman and CEO David Becker called the agreement a turning point for the bank. By shedding lower-coupon, fixed-rate assets, First Internet can protect earnings from rate swings. Moreover, management expects the sale to free capacity for new growth in the coming years.
A Net Lease Play For Blackstone
For Blackstone, the acquisition fits neatly into its broader net lease strategy. This asset class offers long-term leases, built-in rent escalators, and predictable cash flow. These traits balance Blackstone’s floating-rate lending with more stable, fixed income.
The firm typically pursues 7–8% cap rates and lease terms between 15 and 20 years. With this approach, it reduces portfolio risk while capturing reliable returns. Net lease assets now account for about 5% of Blackstone’s global portfolio, complementing its larger allocations to multifamily, industrial, and data centers.
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Broader Momentum
Between January 2024 and June 2025, Blackstone Real Estate Debt Strategies deployed $38B across multiple asset types. This pace highlights its ability to scale and seize opportunities quickly. Furthermore, the US net lease sector represents a trillion-dollar market, giving Blackstone ample runway for future expansion.
The firm has already proven its scale with acquisitions in casinos, corporate headquarters, logistics, and retail. Each deal adds to its reputation as a leader in predictable, income-focused investing.
Advisors On The Deal
Piper Sandler Loan Strategies acted as introducing broker for First Internet Bancorp. Blackstone received legal counsel from Gibson, Dunn & Crutcher LLP and Ballard Spahr LLP. Both parties disclosed details in filings with the Securities and Exchange Commission.
Why It Matters
This deal signals two major shifts. First, it shows how banks like First Internet can lighten balance sheets and sharpen capital strength through asset sales. Second, it underscores Blackstone’s growing appetite for long-duration income streams, a hedge against inflation and market volatility.
