Search
 

Private Equity Firms: The Curse of Success

Blackstone's $14 billion acquisition of GE's real estate holdings highlights again the concentration of institutional property assets among a relative handful of global private equity players, who mostly trade among themselves, driving up prices. 

By Jonathan D. Miller | Updated on April 15, 2015

Blackstone’s $14 billion acquisition of GE’s real estate holdings highlights again the concentration of institutional property assets among a relative handful of global private equity players, who mostly trade among themselves, driving up prices.  It also points to how the success of these once swashbuckling opportunity investors has pushed them into acquiring vast portfolios of more core-like holdings well into the later stages of the current real estate cycle.

Credit these major brand-name private equity firms for buying low and selling high in the last cycle, and setting their marker as savvy investment partners for pension funds and other institutions. In the new cycle, the money has poured into these deal-making firms as plan sponsors gravitate to “safe” choices. They made some nice transaction bets early on in the 2009-2010 period and the capital flows have only intensified—their next generation funds just vacuum up billions of dollars in commitments from institutions desperate for yield. For Blackstone it’s no problem plunking down $14 billion to GE or a relatively paltry $1.3 billion for the Willis Tower in Chicago. They are swimming in cash.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.