Title from: Reuters, this article comes from WeChat public account: East Forty Capital (ID: DsstCapital) < / span> , author: Tao Huidong

2019 is a milestone year for Blackstone, with US $ 134.4 billion in fundraising and US $ 63 billion in investment records, and AUM has grown since the IPO in 2007. 6.5 times.

The newly released financial report of Blackstone Group shows that Blackstone Group’s total revenue in 2019 is US $ 7.3 billion, an increase of 7% over the previous year. Net income was US $ 3.8 billion, an increase of 18% over the previous year.

The founder and CEO of Blackstone Group Schwartzman said during the earnings call that 2019 is a milestone year for Blackstone, with US $ 134.4 billion in fundraising and US $ 63 billion in investment. For the record, the AUM of Blackstone has increased by 6.5 times since the IPO in 2007.

For 2020, Blackstone specifically reminded the risks of the new coronavirus epidemic, saying that the epidemic may continue to adversely affect economic and market conditions, disrupt global supply chains, and adversely affect many industries such as transportation, hotels and entertainment, Will trigger a period of global economic slowdown.

Core data for 2019

Blackstone’s main business indicators for 2019 are as follows:

Managed assets scale (AUM) reached 571.1 billion US dollars, an increase of 23% compared with the previous year. Break through the $ 500 billion mark for the first time.

Assets charged with management fees It reached US $ 408 billion, an increase of 19% over the previous year, and exceeded the US $ 400 billion mark for the first time in history.

Perpetual capital (Perpetual Capital) The scale reached 103.7 billion US dollars, an increase of 43% over the previous year.

Funding scale USD 134.4 billion, an increase of USD 40.2 billion over the previous year, and it exceeded USD 100 billion for the first time in history.

Total investment scale US $ 62.9 billion, a record high.

Distribution of $ 33 billion in earnings to investors , a decrease of $ 8.8 billion over the previous year.

Investment realized 25.3 billion US dollars , an increase of 4.7 billion US dollars over the previous year.

Investable funds (Dry Power) reached a historical high of 151.1 billion US dollars, of which the real estate sector was 45.7 billion USD, the private equity sector was $ 74 billion.

By the type of income, the Blackstone Group’s 2019 revenue of $ 3.47 billion is management fees, $ 3.47 billion is investment income, and $ 130 million is performance rewards.

In terms of management fees, the revenue of the business segments of private equity, real estate, credit and hedge funds increased by US $ 230 million, US $ 130 million, US $ 37.4 million and US $ 37.3 million, respectively.

In terms of investment income, the real estate, credit, and hedge fund sectors increased by $ 1 billion, $ 170 million, and $ 53.7 million, respectively, but the private equity sector performed poorly, reducing by $ 600 million.

Real estate becomes a scale engine

In terms of the scale of assets charged for management fees, Blackstone’s management scale has historically exceeded the $ 400 billion mark in 2019. In the past three years, the management scale of Blackstone has increased by 47%. As a PE giant with a management scale of hundreds of billions of dollars, the growth rate of Blackstone is quite amazing.

The four business segments of Blackstone Group’s real estate, private equity, hedge funds, and credit are roughly the same in terms of management scale. By the end of 2019, the management scales were $ 128.2 billion, $ 97.7 billion, $ 75.6 billion, and $ 106.4 billion. But real estate and private equity businesses have higher management fees (average slightly higher than 1%) , management fees for hedge funds and credit funds Lower. Therefore, in terms of income, real estate and private equity are the two pillars of Blackstone.

In the past three years, although Blackstone’s real estate, private equity, hedge funds, and credit business segments have maintained growth, the growth rate has clearly differentiated, especially since the size of the real estate segment exceeded that of private equity from four years ago. After the equity, the latter has been dumped further and further.

In 2019, of the $ 112.2 billion in management fee funds raised by Blackstone, the real estate sector accounted for $ 52.4 billion, accounting for half of the country, including the record-breaking largest single fund, namely BREP IX, a $ 20.1 billion fund fund. This made the management scale of the Blackstone real estate sector significantly increase to US $ 128.2 billion, becoming the first real estate fund management agency with a scale of US $ 100 billion. In the past three years, the management scale of the Blackstone real estate sector has increased by 78%.

In contrast, the private equity business raised $ 27.2 billion in 2019, which is only half of the real estate sector. As of the end of 2019, the management scale of Blackstone’s private equity business was $ 97.7 billion.

Sustainable capital grows rapidly and changes capital structure

Blackstone’s sustainable capital scale has increased significantly by 43% in 2019, with a total scale of 103.7 billion yuan. Among the assets Blackstone collects management fees, sustainable capital has accounted for a quarter.

Compared with ordinary funds, perpetual capital has a huge advantage-there is no liquidation period, and in the normal course of business, there is no need to return capital to investors through redemption. Jon Gray, president of the Blackstone Group, made an analogy. Blackstone’s past business model was like planting annual plants and periodically raising funds and investing. Perpetual capital is like planting perennial plants, which will make Blackstone’s asset and income base more stable.

The growth of Blackstone’s sustainable capital is also mainly driven by real estate funds. Invested in the BREIT fund of the MGM Grand Hotel in Las Vegas and expanded its fundraising in 2019, with a total size of $ 13 billion. As of the end of 2019, Blackstone HouseThe total size of sustainable capital in the real estate sector was $ 52.9 billion.

Schwartzman: Blackstone is a one-stop platform

Blackstone also tested a number of new funds in 2019. The first is to raise a $ 3.2 billion life sciences special fund, which was completed in January 2020. At the same time, Blackstone also started to raise the first growth fund and the first secondary fund since its establishment. In other words, the types of funds managed by Blackstone have expanded significantly in the past year.

Blackstone Group CEO Schwartzman said that for LPs interested in investing in alternative assets, Blackstone is becoming a one-stop product provider with a series of funds with different return characteristics and different fields. For financiers, Blackstone is also a one-stop capital service provider, which can provide control investment, minority equity investment, preferred stock investment, mezzanine investment, or loans.

Schwartzman said, “Blackstone basically owns all fields and types of products and investment tools. The scale and diversity of Blackstone brings the right to speak, and we can do things that other companies can’t.”


This article comes from WeChat public account: East Forty Capital (ID: DsstCapital) , author: Tao Huidong