NEW YORK CITY-It’s been another big year for The Blackstone Group. The private equity giant tripled its real estate revenues in the second quarter of 2011 to $648.5 million, up from $208.5 million in Q2 2010, a new report from the firm shows. Companywide, Blackstone’s economic net income was $703.3 million in Q2 2011, a boost from $498 million in Q2 2010.
Chairman and CEO Stephen A. Schwarzman attributes Blackstone’s strong performance in Q2 based on its portfolio companies and real estate investments, despite the challenges present by slowing economic growth. “The carrying values of our investment funds continued to increase, and we once again reported our best quarterly earning since becoming a public company four years ago,” he says, in a statement.
In the real estate segment, ENI rose to $453.5 million in Q2 2011, compared to $121.4 million last year, which the company chalks up to improved operating performance and a drive in performance fees. Blackstone says the unrealized value and cumulative realized proceeds of the segment’s contributed carry funds represent 1.4 times investors’ original investment as of June 30, 2011.
Blackstone notes that increased investment activity led to transactions and other fees this quarter, primarily led by the group’s completion of the $9-billion acquisition of Centro Properties Group’s US portfolio. GlobeSt.com previously reported that the portfolio assets consist of 585 neighborhood shopping centers throughout the country. Blackstone also recently purchased debt on trophy properties such as 1140 Ave. of the Americas and the Times Square Building at 229 W. 43rd Street in Midtown.
The real estate segment’s fund had $2.8 billion of limited partner capital committed to deals which hadn’t yet closed as of June 30. That means 87% of the BREP VI fund was invested or committed at the end of Q2 2011. Going forward, Blackstone has started fundraising for its next major real estate fund, BREP VII. “We experienced inflows across all of our businesses as we captures share and deepened relationships with our limited partner investors,” Schwarzman added.
An analyst with Blackstone’s investor relations department did not return a phone call to GlobeSt.com in-time for deadline.
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