Sunday 17 December 2017

Blackstone set to launch another multibillion euro property fund

Hui-Yong Yu

Blackstone, after raising a record $15.8bn for a global real estate fund, is planning to gather money for a new European property pool, said Tony James, president and chief operating officer of the world's largest alternative-asset manager.

The New York-based firm gathered €6.6bn for its fourth European real estate fund last year, reopening the pool to investors after reaching its target because demand was so great. It has built a huge portfolio of property in Ireland since the crash, including the former BUirlingto Hotel in Dublin.

Blackstone has said it has invested about two-thirds of the fund, Blackstone Real Estate Partners Europe IV, with 2014 being the company's busiest year ever for property deals in Europe.

"In real estate we're coming to the end of a couple of funds that are chunky funds," James said on a conference call with investors to discuss third-quarter results. "BREP Europe at some point will be in the market."

The firm also is raising a new real estate mezzanine-debt fund, James said.

Jon Gray, Blackstone's global head of real estate, said at a conference in San Francisco this month that the firm plans more investments in southern Europe, even as economic distress across the continent has bottomed. Blackstone's real estate deals there include warehouses, office buildings, apartments, and commercial- and residential-property loans.

Blackstone in July agreed to buy Nordic real estate assets valued at about 22 billion kroner (€2.2bn) in the region's largest property transaction since 2008. The cash deal included residential and commercial real estate in Norway, Sweden, Finland, Latvia and Germany.

In core-plus real estate, Blackstone has amassed about $8.5bn in assets under management, James said. The firm made its first investment in that type of property in December 2013. (Bloomberg)

Sunday Independent

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