Blackstone Group is throwing in the towel on a mortgage-backed securities fund. [Bloomberg] — Erin Hudson. Tom Barrack’s Colony Capital is at risk of losing control of two hotel portfolios financed by CMBS, and consensus is emerging in Congress for the federal government to prop up the market. The fund will continue to be actively managed until it is liquidated. Blackstone Real Estate Income Trust Inc. filed for a best-efforts offering of up to $12.00 billion of its class T, class S, class D and class I common shares. Blackstone Real Estate Income Trust, Inc. is a New York Foreign Business Corporation filed on September 30, 2016. Wall Street alternative investment giant The Blackstone Group, with $356 billion in assets, is diving into the beleaguered nontraded real estate investment trust marketplace, registering its first nontraded REIT with the Securities and Exchange Commission on Wednesday. All rights reserved © 2020 The Real Deal is a registered Trademark of Korangy Publishing Inc. When asked about the REIT’s distribution plans, Blackstone spokeswoman Paula Chirhart declined to comment. The only commercial real-estate that I have come to own (indirectly) is via public REITs (publicly traded real-estate investment trusts). But opting out of some of these cookies may have an effect on your browsing experience. The company is externally managed by BX REIT Advisors LLC, an affiliate of the real estate group of The Blackstone Group Inc. Blackstone Securities Partners LP is the dealer manager for the offering. Politicians want Feds to rescue CMBS market, Colony Capital may lose control of 2 largest CMBS hotel portfolios, Submerged in securities: Many CMBS hospitality loans may be underwater soon, Amazon inks huge deal for 975K sf warehouse, Nasdaq’s VC arm invests in proptech startup Dealpath, Judge tosses landlords’ challenge to New York eviction limits, Diamond District building listed for $113M, Breather launches membership program for on-demand offices, Affordable apartments could suffer 50% hit to bottom line: Fitch, Hudson’s Bay, Simon Property Group hit with $846M foreclosure lawsuit, Magna Hospitality emerges as New York’s hotel vulture. The company is winding down the Blackstone Real Estate Income Master Fund, which realized a 24 percent decline when the coronavirus struck in March, according to Bloomberg. Blackstone Real Estate Income Trust Inc. filed for a best-efforts offering of up to $12.00 billion of its class T, class S, class D and class I common shares. For full functionality of this site it is necessary to enable JavaScript. Similarly, the Starwood Capital Group was founded in 1991 and has been a major real estate player for over twenty-five years. The Blackstone portfolio includes a wide variety of asset types: retail, residential, industrial, office, and hotel. Over the seven-year period, investors who buy $10,000 of the REIT’s T shares will pay $906 in commissions and fees, according to the filing. “It looks like the REIT is primarily geared to that market.” Nontraded REIT sales fall off a cliff as industry struggles to adapt, New book details how financial pros manage their own money, Wells Fargo cuts ‘sizable group’ of advisers after profits slump, Social Security announces 1.3% COLA for 2021, Joe Biden will end your retirement plan as you know it, Robinhood internal probe finds hackers hit almost 2,000 accounts, November CFP exam will include online option, 401(k) plans should allow cross selling: Report, New Jersey financial transaction tax set for Assembly hearing, Morgan Stanley adds advisers during pandemic, Most advisers now have more clients than before pandemic, survey finds, JPMorgan Chase creates small-business 401(k) plan. Use of editorial content without permission is strictly prohibited   |   All rights reserved. Blue Vault has been an important partner to Geneos in providing us and our advisors pertinent information about non-traded products and the industry as a whole. The Real Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry. MGM Growth Properties and Blackstone Real Estate Income Trust to Form Joint Venture to Acquire the Las Vegas Real Estate of the MGM Grand and Mandalay Bay for $4.6 Billion and Simultaneously … We are having some technical difficulties. It is mandatory to procure user consent prior to running these cookies on your website. Blackstone Real Estate Income Trust is a public non-listed REIT designed to provide individual investors with access to Blackstone’s leading institutional real estate investment platform. Such REITs typically carry loads of 12%, including a 7% to brokers at the time of sale. … This category only includes cookies that ensures basic functionalities and security features of the website. Home > News Article > Blackstone Real Estate Income Trust registers $12B best-efforts offering, September 25, 2020 | Maera Tezuka | S&P Global Market Intelligence. The Blackstone Real Estate Income Trust Inc., which will invest primarily in stabilized income-oriented commercial real estate, looks to raise $5 billion from investors, with $1 billion of that in shares of its distribution reinvestment plan, according to its registration filing with the SEC. The securities the fund held were reportedly packaged by both government entities and private issuers. Blackstone Real Estate Income Trust, a publicly registered non-traded REIT sponsored by private equity giant The Blackstone Group (NYSE: BX), updated the monthly net asset values for its Class S, Class I, … Yesterday, Toronto-based rental housing company Tricon Residential announced a $300-million USD (or $395-million CAD) equity investment led by Blackstone Real Estate Income Trust (BREIT), a global leader in real estate … But look for Blackstone to shun the traditional marketplace of independent broker-dealers and turn to wirehouses such as Merrill Lynch and Morgan Stanley, with whom they already have business relationships, to sell the new REIT, according to one industry executive who asked not to be named. Try again later. The annual BD Summit is a valuable due diligence experience for any broker dealer. These cookies will be stored in your browser only with your consent. The Blackstone Real Estate Income Trust Inc., which will invest primarily in stabilized income-oriented commercial real estate, looks to raise $5 billion from investors, with $1 billion of that … By May 31, the fund’s net assets had fallen to $553 million from $773 million at year-end. Necessary cookies are absolutely essential for the website to function properly. As this chart from Blackstone shows, adding some income … The offering consists of up to $10.00 billion of … Priced at the industry standard $10 per share, the REIT’s upfront selling commissions on its T shares are 3%; investors will also pay dealer manager fees of 50 basis points and an annual stockholder servicing fee of 85 basis points, which runs a maximum of seven years, according to the SEC filing. We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. (See: Nontraded REIT sales fall off a cliff as industry struggles to adapt ), The wirehouse reports a net increase of 70 advisers during the summer, despite COVID-19, The bank reported a year-over-year decline of 815 advisers, according to its earnings report released Wednesday morning, The new charges will be levied on a popular pathway for advisers to conduct business directly with mutual fund companies, Subscribe for original insights, commentary and discussions on major news stories of the week, from the InvestmentNews team, © 2020 InvestmentNews LLC. Those who buy S shares will pay slightly higher upfront commissions, but the same total amount over the seven-year period. And the coming fiduciary standard for brokers working with client retirement accounts — formally introduced in April by the Department of Labor — is also a key factor in depressing sales. In the past five years, the fund had an average annual return of 5.52 percent. Blackstone will likely “distribute this REIT through the wirehouses,” said the executive who said he did not have direct knowledge of the REIT’s distribution strategy. The closure of the fund comes as CMBS delinquencies soar, particularly in the hospitality sector. Blackstone bought the fund’s assets in part with $400 million borrowed through reverse repurchase agreements, filings cited by Bloomberg show. Capped at close to 9%, the cost structure of the new Blackstone REIT is clearly different than the traditional, full-commission nontraded REIT sold mainly product that independent broker-dealer such as LPL Financial and Ameriprise Financial Services Inc. I have been looking into adding a dose of commercial real-estate in my portfolio. ", Blue Vault Broker Dealer Educational Summit, Due Diligence Coordinator and Marketing, Geneos Wealth Management, Blackstone Real Estate Income Trust registers $12B best-efforts offering, BDC NAVs, Distribution Rates, SRP, and DRIP, NTR NAVs, Distribution Rates, SRP, and DRIP, Nontraded Business Development Companies (BDCs), Leitbox Successfully Sells Mixed Use Storage Development, Phillips Edison & Company to Issue Third Quarter 2020 Earnings Release and Host Results Webinar Presentation, More Than Half Of Tech Companies Plan To Dispose Of Real Estate In Coming Months, SmartStop Asset Management’s YOUnion-Branded Student Housing Portfolio Reaches Occupancy Rate of 98.4%. Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. In a filing, Blackstone said closing the fund would provide its shareholders with cash and the “best path to maximize portfolio recovery.”. The Blackstone Group Inc. (“Blackstone”) is a leading global investment manager. By clicking Subscribe you agree to our Privacy Policy. Please Allow Javascript and reload this page. The company's filing status is listed as Active and its File Number is 5016820. These cookies do not store any personal information. The REIT’s annual dividend, or distribution, will be decided after it begins investing, according to the filing. You also have the option to opt-out of these cookies. The offering consists of up to $10.00 billion of shares in a primary offering and up to $2.00 billion of shares under its distribution reinvestment plan. 0 Blackstone Real Estate Income Trust (BREIT) Blackstone Advisory Partners L.P., Dealer Manager / Member FINRA November 2018 This is neither an offer to sell nor a solicitation of an offer to buy the … We also use third-party cookies that help us analyze and understand how you use this website. Nontraded REITs have been routinely criticized for their high fees and opaque cost structures. The real estate group of Blackstone, Blackstone Real Estate, is our sponsor and an affiliate of our advisor. Blackstone said in its filling that the Master Fund’s assets “have begun to see a recovery in pricing since the recent trough related to the outbreak of COVID-19.” CEO Stephen Schwarzman forecasted a V-shaped recovery last month. Blackstone Group is throwing in the towel on a mortgage-backed securities fund. Sales of such REITs have suffered dramatically this year because of two key factors, according to industry executives. The company will use the net proceeds to fund its investment strategy, reduce and repay debt under various financing agreements, and finance repurchases under its share repurchase plan. First, a new rule by the Financial Industry Regulatory Authority Inc., known as 15-02, has made REIT prices more transparent to investors and thus more difficult for brokers to sell. InvestmentNews reported in February that The Blackstone Group was seriously considering launching a nontraded REIT. This website uses cookies to improve your experience while you navigate through the website. Information regarding Blackstone and Blackstone Real Estate … The REIT’s special limited partner, an affiliate of Blackstone, will receive a fee of 12.5% of the REIT’s total return after meeting a 5% hurdle. Round-up of top news and topics for each of the following cities: Editorially-curated headlines and news to know for the following areas: The numbers behind office leases, retail, sales and financing.