Blackstone: hello, good buys
Mr Schwarzman highlighted the opportunities in Australia while speaking at a recent investment conference, with his global investment firm backing that bullish view by deploying extra staff at local offices. Blackstone also had a recent splurge on property assets in Melbourne and Sydney.
"In Australia, we've been buying a lot of stuff," said Mr Schwarzman, who, according to Forbes, has an estimated personal fortune of $US6.5 billion ($7.1 billion) and gained notoriety for shelling out $3 million on a 60th birthday party that included a payment of $1 million to singer Rod Stewart to croon for his guests.
Mr Schwarzman told analysts and investors he considered Australia's currency overvalued because of the resources boom. With the recent correction against the greenback, it seems he was flagging that Blackstone was poised to move in.
The comments came as Blackstone, one of the world's biggest managers of alternative assets, closed the largest-ever private real estate fund after taking in $US13.3 billion of offers.
It means Mr Schwarzman and his global investment team can back up their talk with action, and Blackstone has been an active bidder of late on a range of commercial property assets in Australia, picking up some prime commercial and shopping centre assets in capital city CBDs.
In 2011, Valad Property Group shareholders voted through a $207 million takeover by Blackstone, handing to the private equity giant the company's V-Plus Core fund, which at the time had a 39 per cent stake in Gold Fields House office tower at Circular Quay as well as Valad's European arm, which controlled a $6 billion funds-management business. Having digested that deal, Blackstone then spent $9.2 billion on shopping centre group Centro's US assets.
Blackstone also bought Sydney's Top Ryde shopping mall and an office tower on Castlereagh Street, as well as paying about $650 million for a $2 billion portfolio of distressed property loans on about 50 Australian properties.
The group is also rumoured to be looking at buying a $574 million-plus hotel portfolio from the Brookfield Group and is a front-runner for two shopping centres in Melbourne, including the Greensborough shopping mall.
Blackstone has revealed it has $US1.5 billion of capital commitments for its Asian property fund, targeted at $US4 billion. It will focus on property deals in China, India, Australia and Japan.
Frequently Asked Questions about this Article…
Blackstone’s co‑founder Stephen Schwarzman has singled out Australia and the Asia‑Pacific as attractive opportunities for the firm’s large commercial property fund. The article says Blackstone has increased local staff, been an active bidder on prime CBD assets in Melbourne and Sydney, and sees the region as a focus for its Asian property strategy.
Blackstone closed what the article describes as the largest‑ever private real estate fund, taking in US$13.3 billion of offers — giving the firm substantial firepower to buy commercial property internationally, including in Australia.
According to the article, Blackstone has bought a range of commercial assets in Australia, including Sydney’s Top Ryde shopping mall, an office tower on Castlereagh Street, and a portfolio of distressed property loans (about 50 Australian properties) for roughly US$650 million. The firm has also picked up prime shopping‑centre and CBD assets in Melbourne and Sydney.
In 2011 Valad shareholders approved a US$207 million takeover by Blackstone. That deal handed Blackstone the V‑Plus Core fund (which held a 39% stake in Gold Fields House at Circular Quay) and Valad’s European arm, which controlled about US$6 billion in funds‑management business.
Yes — the article says Blackstone was rumoured to be pursuing a US$574 million‑plus hotel portfolio from the Brookfield Group and was a front‑runner for two Melbourne shopping centres, including the Greensborough shopping mall.
Stephen Schwarzman told analysts he considered the Australian dollar overvalued during the resources boom. The article notes a recent correction against the US dollar, which Schwarzman appeared to flag as a factor making it more appealing for Blackstone to move into Australian property.
Blackstone revealed it has US$1.5 billion of capital commitments for an Asian property fund that is targeting US$4 billion. The fund will focus on property deals across China, India, Australia and Japan.
The article shows large institutional money from Blackstone is being deployed into Australian commercial and shopping‑centre assets, suggesting strong institutional demand for prime property. For everyday investors, that can mean increased competition for quality assets and a clear signal that big global managers see opportunities in Australia’s property market.
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