Blackstone Inc. has closed on its largest global property drawdown fund, targeting opportunistic deals across sectors such as rental housing, hospitality and data centers. 

The company secured $30.4 billion of total capital commitments for the fund, called Blackstone Real Estate Partners X, according to a statement Tuesday. Blackstone’s latest fund is the largest of that type, according to PitchBook data going back to 2002.

The real estate market has come under pressure over the past year due to a pullback across commercial-property lending, as borrowing costs skyrocketed. At the same time, the stocks of public real estate investment trusts have also suffered amid the uncertainty in the market and increasing concerns about certain property types such as offices. 

“Pullback with all forms of capital will create opportunities,” said Kathleen McCarthy, global co-head of Blackstone Real Estate. “We can use our capital and expertise to capitalize on the moment for our investors.”

Blackstone’s latest fundraising helps cement the private equity firm’s status as a powerhouse in the real estate market. Blackstone’s real estate business, which started in 1991, now has $326 billion of investor capital under management.

Eoin Treacy's view

The vintage of property funds is likely to be a major conversation piece over the next few years. Those that closed on purchases between 2019 and 2022 in commercial real estate paid top prices and will be sitting on implied and real losses for years. They are in much the same position as investors that bought bonds with negative yields.

Those raising money now, with the aim of investing at some point over the next couple of years will be in a much more promising position. Yields are higher, spreads and wider and at least some sellers are distressed. It’s a good time to begin choosing what kinds of building will be attractively priced in an upcoming recession.
Blackstone is attempting to build support in the region of the 1000-day MA but has yet to break the medium-term downtrend.