Blackstone To Launch New Real Estate Fund in Asia

Blackstone Group LP is on the verge to launch its new real estate fund in Asia. Blackstone Group considers this as their plan to seize the Asian real estate market.

Blackstone plans to raise another real estate fund to be launched in Asia. World’s largest private real estate firm’s CEO Schwarzman disclosed their plans to become the largest buyers of commercial real estate in India. He also had laid his eyes on Australian real estate market as well.

Blackstone group was set up by Stephen Schwarzman and Peter Peterson in the year 1985. Primarily the firm was or still is best-known for its private equity business. Yet there is no doubt over the fact that it is now the largest private real estate firm of the world. Real estate assets of the firm value $53.5 billion which is highly above than all other real estate firms.

Blackstone President Tony James revealed that the firm was planning of an Asian real estate fund. He was addressing the Goldman Sachs’ financial services conference in New York. However, he declined to reveal any details of the new real estate fund.

Real estate assets of the firm make up only a quarter of their entire assets. Yet the figures show that this is the most profitable business of Blackstone. It is estimated that a half of its total profit in the third quarter was drawn from the real estate business.

Blackstone officials said that the firm had raised its latest global real estate fund worth $13.3 billion. This is counted as the largest real estate fund ever. James claimed a unique position and an upper hand for the firm in the real estate field. He added that collapse of real estate washed the firm’s competitors away.

Blackstone became familiar to Asian real estate property deals with its global funds and MB, a $2 billion-plus Asian real estate fund.  New York based Blackstone had taken over this fund from Bank of America-Merrill Lynch in the year 2010. The New York based private equity firm has a European real estate fund. Besides the firm also has another U.S. real estate debt fund too.

James spoke about the strategy of Blackstone. The firm aims to snap up troubled real estate assets and turning them around to sell them with 20 % returns. The firm will sell them to parties who look for 5 or 6 % returns. James said that real estate market is the only market where buying and selling takes place simultaneously.

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