Blackstone Group Inc. has finished raising a 9.8 billion-euro ($10.7 billion) fund that will target European real estate.
The fund swells the firm’s uninvested capital for opportunistic property bets to about $30 billion just as the coronavirus roils markets worldwide. It’s also the largest private equity capital raising to complete since the pandemic’s outbreak, according to data compiled by Bloomberg.
“Our scale and reach allow us to put capital to work strategically during this period of elevated volatility,” James Seppala, Head of Real Estate Europe, said in an emailed statement. “The significant demand for the fund is testament to the confidence our investors have in our ability to deploy strategic long-term capital to assets and businesses across Europe.”
Blackstone Real Estate Partners Europe VI made its first investment toward the end of last year when it purchased Dream Global Real Estate Investment Trust, according to the statement. The C$6.2 billion ($4.4 billion) deal was completed in December and added European office and industrial assets to Blackstone’s property portfolio, currently the world’s largest.
Many of the real estate bets made by Blackstone in the aftermath of the 2008 global financial crisis proved to be among the firm’s most profitable.
In recent weeks, landlords including Blackstone have had to negotiate rent waivers and other support measures as tenants were hit by the economic impacts from governments telling people to stay home amid the pandemic.
Many private equity firms have had to focus attention on protecting companies in their portfolios by shoring up cash and drawing on credit lines. Only 4% of investors see the current market as a buying opportunity, CIL Management Consultants said on Wednesday, citing a survey of PE clients.
Private equity firms started 2020 with almost $1.5 trillion in unspent capital, the highest year-end total on record, according to data compiled by Preqin. - Bloomberg