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Blend materials of nearby actors

Hi,

I am building my level out of 3D tiles. I am now looking for a method to blend the material of a static mesh with the neighbour meshes so that the transition between the materials is smooth and has no hard borders. Something like in 2D tilemap games (Age of Empires, or even in 3D Starcraft 2). I have no idea if this is possible or if there is some other method that would work better. Any help is appriciated.

Here is a screenshot of my current situation. I want to the grass block to have a smooth transition to the cliff block.

Hey I have exactly this same situation. Did you ever find a solution?