Blackstone has purchased a six-property multifamily portfolio for $430 million from TA Realty, the private equity firms said on Wednesday.
New York-based Blackstone bought the portfolio through Blackstone Real Estate Income Trust, its non-traded real estate investment trust launched in August to focus on core properties. The REIT made its first purchase in January, the Hyatt Place UC Davis, for $32.2 million from private equity real estate firm Westbrook Partners, PERE previously reported.
A spokeswoman for Blackstone declined to comment, and a spokeswoman for TA Realty was not immediately available to comment.
Boston-based TA Realty assembled the 2,514-unit portfolio through TA Realty Associates Fund IX, its ninth value-added vehicle. The portfolio spans four states, with properties in cities including Dallas, Chicago and Orlando.
“We believe the outcome of this transaction represents compelling value for Fund IX investors,” Tom Landry, a managing partner at TA Realty, said in Wednesday’s statement. “The price we were able to command for this well-located portfolio of apartment communities reflects the significant value created through strategic operational and capital improvements over the ownership period.”
The firm closed Fund IX in March 2010 on $1.5 billion, according to PERE data. Investors in the vehicle included the New Jersey Division of Investment, the Minnesota State Board of Investment and the Maryland State Retirement and Pension System, which all allocated $100 million, and Arkansas Public Employees' Retirement System, which earmarked $50 million. PERE understands that NJDOI is no longer an investor in the vehicle.
The fund has a target net internal return rate of 15 percent, according to LACERS’ meeting materials. As of December 31, 2016, Fund IX has generated an 11 percent net IRR and a 1.6x multiple, according to Minnesota's fourth quarter investment report.