Blackstone’s U.S. CRE Push Suggests the Sector’s Strength Amid Uncertainty
March 9, 2022 | Tom Martin | WealthManagement.com
With markets across the world weathering uncertainty in the face of the war in Ukraine, commercial real estate in the U.S. appears to be holding on as a stable destination for investments. Among the firms capitalizing on the sector’s ongoing bullish growth is private equity giant Blackstone: in the past month, Blackstone has continued a string of major U.S. real estate acquisitions with a nearly $6 billion deal and the announcement of a new portfolio company specializing in affordable housing. The firm has become the country’s top buyer of office, industrial, apartment and hotel properties in the past year and its continued growth suggests the U.S. commercial real estate assets will continue to be viewed as popular investment options despite market uncertainty the world over.
For example, in mid-February, Blackstone went public with the news that it was purchasing Preferred Apartment Communities for $5.8 billion in a cash offer at $25 per share, with the deal expected to close in the second quarter of this year. The announcement saw Preferred’s share price jump 7 percent. The Preferred portfolio includes 40 properties located across the Sun Belt in Atlanta, Charlotte, N.C., Nashville, Tenn. and Jacksonville, Orlando and Tampa, Fla. The properties contain a total of around apartment 12,000 units.
“Investing using BREIT’s perpetual capital will enable us to be long-term owners of these vibrant communities,” says Jacob Werner, co-head of Americas acquisitions for Blackstone Real Estate. “The company’s grocery-anchored retail portfolio performance has also been strong and resilient, and we believe these types of necessity-oriented assets located in areas with growing populations are well-positioned for continued growth.” According to Werner, the Preferred acquisition will help Blackstone to focus on building out its expertise and relationships in Sun Belt markets.
