Blackstone has been seeking to diversify its investor base after tapping institutional investors, such as public pension funds, insurance firms and sovereign wealth funds, for its products for decades. They were down a further 2% on Friday morning at $83.45. Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Even if Blackstone does not acquire BSR or STAG, we think both REITs will perform well in the future. Investment advisors assess the shares and report them in terms of fair value, like how mutual funds work. Matthew DiLallo has positions in Blackstone and has the following options: short June 2023 $60 puts on Blackstone. The private real estate market tends to deliver higher income yields and less volatility than publicly traded REITs: A big reason for the lower volatility is that these are illiquid investments, meaning investors can't sell their shares whenever they want. If you can't get your money back, does the "paper valuation" then have any meaning? Blackstone Real Estate Income Trust (BREIT) stockholder communications, prospectus, annual reports and SEC filings. Cuando se ampla, se proporciona una lista de opciones de bsqueda para que los resultados coincidan con la seleccin actual. There are also selling commissions upfront that can amount up to 3.5% and stockholder servicing fees that can add up to 0.85% each year. Source: BREIT Prospectus (as of June 30, 2021). ("Net asset value" is akin to an adjusted book value for REITs using estimated market values for their real estate. High Yield Landlord is managed by Leonberg Capital. As of FY 2020, BREITs real estate debt investments consist of 194 investments in CMBS, 15 investments in RMBS, 10 corporate bond investments, and 9 real estate loans. As of their Q2 2021 report, total real estate debt investments have a fair value of $5.7B with a weighted average coupon of 5% and a weighted average maturity date of July 5, 2025. Digging into Blackstone's latest real estate deal, Blackstone has agreed to pay $187.50 per share in cash for PS Business Parks, a roughly 15% premium to its average share price over the last two months. The deal values theindustrial REITat $7.6 billion. As of FY 2020, each common stock class received a gross distribution of $0.6354 per share. Currently, Blackstone has a market capitalization of $66.78 billion. That's one of, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Motley Fool Issues Rare All In Buy Alert, Copyright, Trademark and Patent Information. Funds controlled by Stephen . So far, its highest total net distribution (includes deductions of corresponding fees already) was Class I shares in FY 2019. BREIT has delivered differentiated returns for its investors since its formation. Blackstone has reported a 9.3% year-to-date return for its REIT, net of fees, a contrast to the publicly traded Dow Jones U.S. At times, they might not even repurchase at all when you need the money urgently. I don't know many asset classes that perform -- outperform indexes by 3,000 basis points." The company has a market cap of $3.67 billion, a P/E ratio of 14.90 and a beta of 1.31. Blackstone REIT agreed to buy all of the outstanding shares of Preferred Apartment Communities for $25.00 each, and once the transaction closes, the REIT's common stock will no longer be listed on the New York Stock Exchange. While it has steadily put that money to work, cash continues flowing into BREIT's coffers because of its growing reputation for delivering top-tier returns. Puoi cambiare le tue preferenze in qualunque momento nella sezione Le tue impostazioni per la privacy. This is surely a huge factor in the discount at which BSR typically trades. Proof in point: BREIT just had to limit withdrawals because too many investors are currently seeking to get out of it. Get them exclusively at High Yield Landlord. For example, Blackstone provides the option to repurchase shares from investors once a month. Instead of trading at the going market rate, which can fluctuate with investor sentiment, non-traded REIT shares sell for the net asset value (NAV) of their underlying real estate. Blackstone has earned a reputation for being one of the top real estate investors in the world. Those returns will eventually draw more investors to BREIT. Focusing on the common shares, BREIT has a total of 112,104 holders across the 4 types of class shares as of March 17, 2021. The asset manager is buying so aggressively because REIT valuations are significantly below the private market valuations of their real estate. Nonetheless, they fueled investor concerns about the future of the REIT, which makes up about 17% of Blackstone's earnings. The curbs came because redemptions hit pre-set limits, rather than Blackstone setting the limits on the day. The index is down 17%, we were up 2.3%. In fact, Blackstone is close to finalizing what could be the biggest traditional private-equity real estate investment fund in history, according to the Wall Street Journal. BREIT is a REIT where shares are held by investors, but those shares aren't traded. In July, we saw another example of this accretive capital recycling as STAG sold two properties for $82 million at a 5.2% cap rate after having purchased them several years prior at an average cap rate of 6.2%. Blackstone told investors in a letter it would curb withdrawals from its REIT after it received redemption requests in November greater than 2% of its monthly net asset value and 5% of its quarterly net asset value. The transaction has been unanimously approved by the REIT's Board of Directors and represents a premium of 63 percent to the REIT's most recently published Net Asset Value of $9.06 per share . Update 2018-05-11: Blackstone reports that it's leverage has increased from below-average 41% to above average 60% (average for core plus is 50%). Join us for a 2-week free trial and get access to all my highest conviction investment ideas. Class S shares were the first issued common stock of BREIT in 2017 at $10. Price as of February 28, 2023, 4:00 p.m. Blackstone Inc (BX.N) limited withdrawals from its $69 billion unlisted real estate income trust (REIT) on Thursday after a surge in redemption requests, an unprecedented blow to a franchise that . He added that the REIT had ample cash reserves to "weather pretty much any storm." Overall, investors have handed Blackstone $83.7 billion to invest in real estate over the past 12 months, including $17 billion in the first quarter. In the . KentWeakley. Currently, BSR trades at a particularly stark discount. It invests in real estate properties across 8 sectors and real estate debt through mortgage-backed securities and other real estate-related loans. The Motley Fool has a disclosure policy. HPA's unique, resident-led business model expands housing access and choice, while providing a clear path to . Blackstone and Soilbuild are selling Bukit Batok Connection months after privatising Soilbuild REIT US developer and investment firm Hines has made its first acquisition in the Singapore market, teaming up with German fund manager DWS Group to buy a ramp-up workshop in the Bukit Batok area from a Blackstone-controlled trust for S$93.8 million ($69 million). Blackstone will often claim that BREIT is superior to public REITs because it supposedly provides better diversification benefits. It results in significant economies of scale and better aligns interests with shareholders because they earn salaries based on their performance and not just the mere size of the company. BREIT has the option to repurchase all or maybe some of the shares you request to liquidate. The firm owned 20,221 shares of the asset manager's stock after acquiring an additional 5,035 shares during the quarter. BREIT is an externally-managed REIT. I wrote this article myself, and it expresses my own opinions. Public Storage expects to recognize a $2.3 billion after-tax gain, which it intends to distribute to its shareholders. 3 Beaten-Down Dividend Stocks to Buy Without Hesitation, My Top 3 Dividend Stocks to Buy Today (and It's Not Even Close), 2 FAANG Stocks Billionaires Are Selling in Droves and 1 They Can't Stop Buying, 3 Stocks That Could Join Apple, Microsoft, and Alphabet in the $1 Trillion Club, 1 Bargain-Basement Warren Buffett Stock Down 78% to Buy Before It Starts Soaring, 2 Growth Stocks That Can Turn $250,000 Into $1 Million by 2030, According to Bloomberg, investors requested to pull more than $5 billion out of, Blackstone created BREIT in 2016 to provide high-net-worth individual investors with access to institutional-quality private real estate investments. Write by: Class S and T shares dont include the upfront 3.5% sales charge at initial subscription yet. This implies that the REIT was able to sell properties at a significant gain from its original purchase price. LONDON (Reuters) -While there has been little wider fallout from this week's surge in redemption requests at an unlisted Blackstone real estate income trust (REIT), it is being read by some as a warning sign. What Blackstone's REIT Acquisition Spree Is Telling Investors, Blackstone Is Becoming a Real Estate Powerhouse, 2 FAANG Stocks Billionaires Are Selling in Droves and 1 They Can't Stop Buying, 3 Stocks That Could Join Apple, Microsoft, and Alphabet in the $1 Trillion Club, 1 Bargain-Basement Warren Buffett Stock Down 78% to Buy Before It Starts Soaring, 2 Growth Stocks That Can Turn $250,000 Into $1 Million by 2030, With billions of dollars in dry powder across its real estate private equity funds and cash continuing to pour into its funds. For a more comprehensive brief of BREITs real estate investment portfolio, refer to the table below. Invest better with The Motley Fool. Blackstone Mortgage Trust is not owned by hedge funds. For a Limited-Time - You can join Seeking Alphas #1 community of real estate investors at the Lowest-Rate-Ever-Offered. There is no upper limit on the size of this new fund, so it could potentially grow significantly larger. The asset manager partners with big money players like pension funds and insurance companies to provide strong returns and steady income. The latter deal included . Disclosure: I/we have a beneficial long position in the shares of CORE PORTFOLIO + RETIREMENT PORTFOLIO + INTERNATIONAL PORTFOLIO either through stock ownership, options, or other derivatives. Though Blackstone sometimes acquires individual real estate properties, such as The Bellagio in Las Vegas, it more often seeks opportunities to scoop up whole portfolios that will move the needle. If you dont like it, we wont charge you a penny! Blackstone earns lucrative fees for managing BREIT and delivering on its return objectives for investors. Multifamily REIT Preferred Apartment Communities announced . 2021 YTD returns were the highest because BREIT has recovered well from the effects of the COVID-19 pandemic. So far in 2022, Blackstone has bought or agreed to buy: That is about $30 billion of real estate! Ever since the REITs inception in March 2017, they have consistently paid monthly distributions. US private equity giant Blackstone Group has defied market jitters and pulled off a mega sale of an office tower above the Westfield mall in Sydney's CBD to Hong Kong-based Link REIT for $683 million. For the first six months of the year, our real estate strategies appreciated 9% to 10% versus a 20% decline in the REIT index, equaling an outperformance of roughly 3,000 basis points. Last but not least, since REITs are today priced at large discounts to fair value, they also pay a higher yield and offer a lot greater upside potential. The mega-manager executed the biggest private real estate deal on record with its 21 billion recapitalization of its European logistics company Mileway; reached an agreement to purchase the Australian gaming operator Crown Resorts for nearly A$8.9 billion ($6. A real estate private equity firm with over 20 years of successful performance, are currently looking to add a Property Accountant to their team. Although Santarelli kept his price target for Gaming & Leisure Properties Inc. at $60 per share, he bumped his . "Leasing inspections are still occurring [but] most organisations are delaying the decision-making process," Mr Ballantyne said. Image courtesy of Bluerock Residential Growth REIT. Is It a Buy Right Now? That's a 39% premium to its stock price on Feb. 9, when news broke that . I wrote this article myself, and it expresses my own opinions. But the better way to gauge a REITs performance is through its FFO. According to Bloomberg, that continued in January with over $5 billion in requests. Cap rates have expanded a bit, but so has the property NOI in most cases. -. And our opportunistic funds protected capital, down only 1%, so we only performed by 16% for our customers over the index. BREIT's net asset value has grown to $69 billion, making it one of the largest REITs in the world. NAV REITs do away with daily price fluctuations, making them less volatile compared to traded REITs. High Yield Landlord is managed by Leonberg Capital. I have no business relationship with any company whose stock is mentioned in this article. Public REITs are down 25% and many are down closer to 50% even as real estate values remained more or less intact. Dividends are paid and capital gains, if any, are shared. The stock, however, is only traded over the counter in the US as well as on the Toronto Stock Exchange under the ticker symbol HOM.U. We spend 1000s of hours and over $100,000 per year researching the market for the most profitable investment opportunities and share the results with you at a tiny fraction of the cost. To make the world smarter, happier, and richer. Blackstone managed a total of $236 billion of wealth held by individuals as of the end of September, up 43% year-on-year. Driving those returns was the company's thematic investment approach, currently focused on rental housing and industrial real estate in the Southern and Western parts of the country.