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‘Unprecedented’ Inflows Drive Blackstone’s Assets to $545 Billion

The private markets giant reported a 24 percent year-over-year increase in assets under management the same day it announced a $14 billion fund close.

Alternative investment firm Blackstone hauled in $151 billion from limited partners in just one year — including $45 billion in the last three months alone, according to the company’s second-quarter earnings statement.

Blackstone announced that its total assets under management surpassed $545 billion at the end of June following 12 months of “unprecedented” inflows and positive investment performance. This represented a 24 percent increase in assets from the year before, when assets under management measured at $439 billion.

In an investor conference call on Thursday, Blackstone chairman and CEO Stephen Schwarzman described the results as “extraordinary.”

“The past few months have been a remarkable period for Blackstone,” he said.

Despite the record asset flows, earnings fell to about $306 billion, or $0.45 cents per share, down from $742 billion, or $1.09 per share, in the year-ago quarter. Profits were also lower for the 12-month period ending June 30, falling to $1.2 trillion from nearly $1.8 trillion in the year ending in June 2018. Distributable earnings rose about 1 percent, to $709 million, from the same period a year ago.

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As of June, private equity represented the highest portion of the firm’s assets under management, at $171.2 billion, followed by real estate at $153.6 billion and credit at $139.3 billion. The hedge fund solutions business had assets under management of $81.4 billion at the end of the second quarter, according to Blackstone. All four units saw an increase in assets over the 12-month period.

Over the same period, Blackstone said it deployed $16.8 billion from its funds. Meanwhile, uninvested capital, or dry powder, rose to $150.3 billion from $88.3 billion one year earlier — a record for the firm. The pile included $74.9 billion allocated for private equity investments and $45.1 billion meant for real estate.

The firm’s vigorous fundraising activity has continued into the beginning of the third quarter, with Blackstone announcing back-to-back fund closes on Wednesday and Thursday.

On Wednesday, the firm said it had raised more than $11 billion for its eighth secondaries fund, Strategic Partners VIII. The following day, the company announced that Blackstone Infrastructure Partners, a permanent capital vehicle, had closed on $14 billion in commitments in its first round of fundraising.

On the earnings call Thursday, Schwarzman said that more than 80 investors had committed to the fund, making it one of the three largest infrastructure funds in the world.

“This is a remarkable achievement, and speaks to the trust that global investors have in our firm,” he said.

As of the end of June, Blackstone had $91.7 billion in perpetual capital, or assets managed on a indefinite basis.

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