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Blackstone reaches $1bn for non-traded REIT

The firm is also planning a ‘significant’ close for its second Asia opportunistic fund later this year.

Blackstone has corralled $1 billion of equity for its non-traded real estate investment trust, according to its earnings results released Thursday.

The New York-based firm launched Blackstone Real Estate Income Trust in August to focus on stabilized, income-oriented core properties and had raised $478 million as of March 31, according to its first quarter earnings results. The REIT invests across property types and made its first purchase in January, the Hyatt Place UC Davis, for $32.2 million, and owned 55 properties as of July 12, according to a filing with the Securities and Exchange Commission. Its portfolio is 60 percent multifamily, 29 percent industrial, 7 percent hospitality and 5 percent retail, as of July 12.

BREIT is an extension of Blackstone's core-plus business, Blackstone Property Partners. The open-ended fund for institutional investors, launched in July 2014, had $14.3 billion in committed capital and generated a 12 percent net internal rate of return as of June 30, down from a 15 percent IRR in the second quarter of 2016, according to the firm’s second-quarter earnings results.

During the second quarter, BREIT purchased an interest in HS Industrial Portfolio from High Street Realty for $402 million, according to an SEC filing. The 38-property portfolio, which totals six million square feet, is 97 percent leased.

In another deal during the quarter, BREIT bought interests in six multifamily properties from TA Realty for $430 million. The portfolio, located across the country, is 92 percent occupied. BREIT also inked three other multifamily deals and one hotel deal during the second quarter.

During the second quarter, Blackstone brought in $3.2 billion of capital for its real estate strategies, including €1.1 billion for the final closing of Blackstone Real Estate Partners Europe V, which closed in June on €7.8 billion, PERE previously reported.

Michael Chae, the firm’s chief financial officer, said Blackstone also expects to hold “significant closings” in the second half of the year for several vehicles across strategies, including its latest Asia-focused real estate fund, BREP Asia II. The firm is seeking to raise at least $5 billion, the same amount it collected for the predecessor vehicle, which closed in December 2014, PERE previously reported. Investors in the vehicle include the Illinois Municipal Retirement Fund, which earmarked $100 million, according to PERE data.

BREP Asia generated a 19 percent IRR as of June 30, according to the second-quarter earnings.

As of June 30, Blackstone managed $371.1 billion in overall assets and $104 billion in real estate, up from $368.2 billion and $102.1 billion, respectively, at the end of the first quarter.