Bloomberg News

Blackstone Said to Seek at Least $2 Billion for Asia Fund

December 10, 2012

Blackstone Group CEO Schwarzman

Stephen Schwarzman, chairman and chief executive officer of Blackstone Group LP said “the long-term direction in Asia, for the economies here, is strongly up.” Photographer: Peter Foley/Bloomberg

Blackstone Group LP (BX:US), the biggest manager of real estate private-equity funds, seeks to raise more than $2 billion for its first property pool focused on Asia, a person with knowledge of the effort said.

The exact amount hasn’t been determined, said the person, who asked not to be identified because the information is private. Tony James, New York-based Blackstone’s president and chief operating officer, hinted at the company’s plans last week at a conference sponsored by Goldman Sachs Group Inc.

“We’re now starting an Asian real estate fund,” James said at the Dec. 5 conference in New York. “These are unique products, and they’re unique products in an asset class that investors increasingly want. It’s hard assets.”

Blackstone plans to focus on Japan, China, Australia and India, another person with knowledge of its strategy said.

The Asia-Pacific region’s economic growth and decline in property values have attracted private-equity investors. Blackstone has said it is seeking commercial buildings in Australia that require work to maximize value. The firm in 2010 took over management of more than $2 billion of Asian real estate assets from Bank of America Corp.

Australia, India

While the new pool will be the firm’s first real estate fund devoted to Asia, Blackstone has been among the biggest buyers of property in Australia and India, Chairman and Chief Executive Officer Stephen Schwarzman told reporters in Hong Kong on Oct. 26.

“The long-term direction in Asia, for the economies here, is strongly up,” Schwarzman said.

Christine Anderson, a spokeswoman for Blackstone, declined to comment on the company’s fundraising.

In the U.S., Blackstone has been the biggest buyer of commercial real estate since prices bottomed in 2009. Blackstone’s real estate unit, which has more than $50 billion of equity under management, raised a record $13.3 billion earlier this year for a global opportunity fund. Such pools seek to buy assets at discounts using borrowed money to boost returns.

To contact the reporters on this story: Hui-yong Yu in Seattle at hyu@bloomberg.net; Devin Banerjee in New York at dbanerjee2@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net


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