Near $1 trillion worth of assets are under direct management of Blackstone Inc.
You read that correctly. Blackstone is the largest alternative investment firm in the world and manages a portfolio of assets worth just over $1 trillion. Blackstone is diverse in their business proceedings, so much so that there is not much in this world they don’t or wouldn’t consider investing in. Private equity, infrastructure, real estate, technology, renewable energy, life sciences, credit, just to name a few.
Chairman, CEO and Co-Founder Stephen A. Schwarzman is a well-known and highly-respected New York City based billionaire who is captaining the ship of the trillion dollar juggernaut. Schwarzman has a reported net-worth of a measly USD $32.5 billion. He owns multi-million dollar estates in New York, Florida, Jamaica, Saint-Tropez and most recently, a $101.5 million estate in Wiltshire Country, UK. Schwarzman spends most of his time in the duplex apartment once owned by John D. Rockefeller at 740 Park Avenue in Midtown Manhattan, just down the road from the Blackstone Global Headquarters at 345 Park Avenue. Having been named among the World’s most influential people several times since 2007, Schwarzman – while hyper-wealthy, is a recognised philanthropist. Over his career he has donated substantial amounts, of which include $150 million to Yale University, $350 million to the Massachusetts Institute of Technology and $25 million to the Animal Medical Centre of New York. In a significant announcement, in 2020 he signed ‘The Giving Pledge’ formally committing to donate the majority of his wealth to philanthropic causes.
Other notable figures on the Blackstone Board include President and Chief Operating Officer Jonathon Gray and Chief Financial Officer Michael Chae.
The Blackstone story began in 1985 when Schwarzman, alongside former Chairman and CEO of Lehman Brothers and Richard Nixon’s former US Secretary of Commerce Peter G. Peterson established a business that focused purely on mergers and acquisitions. Soon after came real estate, direct lending, alternative assets and so on. To date, the company manages approximately $585 billion in real estate totalling 12,600 assets, the largest on Earth. Blackstone holds 123 companies in their investment portfolio totalling $137 billion. Add to this $295 billion in credit and insurance AUM and $78 billion in Investor capital under management and you can see how the $1 trillion total AUM milestone has been recently achieved. Blackstone’s growth and power was imminent, a 20% stake of $100 million was purchased by Japanese banking giant Nikko Securities which enabled Blackstone to aggressively expand on a global scale and offer further alternative investment opportunities.
A few noteworthy business deals throughout the decades by Blackstone include:
1980’s
Significant consulting services to CBS Records in the Sony Music buyout
1990’s
The acquisition of Days Inns of America for $250 million
Super 8 Motels acquisition for $125 million -Majority investment into Six Flags amusement parks, US Radio, Centerplate, MEGA Brands, AMF Group, Haynes International, Premcor, American Axle, PAETEC Holding Corp and many more. -Buyout of Prime Succession from GTCR for $295 million -Purchase of the Watergate Complex in Washington D.C for $39 million, later to be sold in 2004.
2000’s
Blackstone acquires Hilton Worldwide for a whopping $26 billion. -Purchase of the 6 World Trade Center mortgage
In collaboration with Thomas H. Lee Partners and Bain Capital, the consortium acquired Houghton Mifflin Company for $1.28 billion -Acquisition of TRW Automotive for $4.28 billion
Blackstone was one of seven private equity giants involved in the buyout of SunGard for $11.3 billion in what would be the largest buyout of a technology company in history
Buyout of La Quinta Inn & Suites, later to be acquired by Wyndham Hotels & Resorts
Joint acquisition of Harrah’s Entertainment
2010’s
Purchase of G6 Hospitality (operator of Motel 6 and Studio 6 Motels from AccorHotels) for $1.6 billion.
20% stake in luxury fashion line Versace for €150 million
Buyout of Willis Tower in Chicago for $1.3 billion
Acquisition for BioMed Realty Trust for $8 billion
A 22 million square foot industrial property portfolio from Cabot Properties
Joint company venture to purchase Merlin Entertainment, who own and operate Legoland, for $7.5 billion
Purchase of the majority stage in MagicLab, who own and operate dating app Bumble.
Buyout of Las Vegas resort The Bellagio in a sale-leaseback transaction.
Majority stake purchase in Ancestry.com for $4.7 billion.
Acquisition of a second Las Vegas resorting giant, ARIA Hotel and Casino, from MGM for $3.89 billion. Blackstone also recently sold The Cosmopolitan Hotel and Casino in Sin City for $5.65 billion after purchasing it for $1.8 billion in 2014.
Takeover of Australian-headquartered Crown Resorts for $6.6 billion and a 90% stake.
Acquisition of PS Business Parks for $7.6 billion.
On June 21, 2007, Blackstone was listed as a public company via an initial company selling a stake of $12.3% for $4.13 billion. At the time of writing, Blackstone Inc. (NYSE: BX) shares are $98.04 with a market cap of $120.1 billion. Blackstone possesses the powerful title of owning the largest commercial property portfolio on Earth. Their presence is felt in all corners of the globe, particularly Australia where Blackstone holds $23 billion worth of property, investments of which include a 75% stake in the prestigious Grosvenor Tower, the J.P Morgan Tower located above Pitt Street Mall in the Sydney CBD, the 437-unit complex known as ‘Realm’ in Melbourne and plenty more.
With over $1T (and counting) under direct management and what seems to be a never ending property portfolio and countless acquisitions, can Blackstone ever be dethroned as the most powerful investment firm in the world?