Blackstone raises $30 billion for real estate fund

Last week, Blackstone Inc announced that it has successfully raised $30.4 billion for its latest global real estate fund, named Blackstone Real Estate Partners X. This fund is 48% larger than the previous real estate fund closed by the asset management giant in 2019, signalling Blackstone’s increased commitment to the industry.

Blackstone has been strategically focusing its portfolio on areas such as logistics, rental housing, hospitality, lab office, and data centres, while shifting away from traditional office and malls. This shift is in response to changing market dynamics, including the post-pandemic rise of flexible work arrangements and the increasing popularity of e-commerce.

In interviews with the press, Ken Caplan, global co-head of Blackstone Real Estate, emphasized the growing importance of sector selection in real estate, stating that performance within the industry is becoming more divided. Blackstone’s shares showed a nearly 1% increase in premarket trading.

The real estate market has faced challenges in the past year due to reduced commercial-property lending and increased borrowing costs. Public real estate investment trusts (REITs) have also experienced declines amid market uncertainty and concerns about certain property types like offices. Kathleen McCarthy, global co-head of Blackstone Real Estate, acknowledged the pullback in capital across the real estate market but also highlighted the opportunities it presents.

Blackstone’s recent successful fundraising efforts further solidify its position as a dominant force in the real estate market. With a real estate business that originated in 1991, Blackstone now manages $326 billion of investor capital. However, not all of Blackstone’s real estate vehicles have experienced smooth sailing. Blackstone Real Estate Income Trust, catering to affluent individuals, has faced increased withdrawal requests in recent months.

Blackstone began raising funds for its large property drawdown fund last year, with three strategies – global, Asia, and Europe – now totalling $50 billion in capital commitments, as stated by the firm. Blackstone Real Estate’s portfolio is heavily concentrated, with around 80% of its investments focused on logistics, rental housing, hospitality, lab offices, and data centres. By successfully raising $ 30.4 billion in total capital commitments for its latest fund, Blackstone Real Estate Partners X, Blackstone has secured the title of being the largest fund of its type according to Pitchbook data dating back to 2002.

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Blackstone raises $30 billion for real estate fund

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