Blackstone Real Estate Income Trust, the massive $69 billion non-traded REIT sponsored by private equity giant Blackstone Group (NYSE:BX), announced to investors in a stockholder letter posted to its website yesterday that investor repurchase requests once again exceeded 2% of its net asset value in January, the maximum monthly amount permitted under terms the company’s share repurchase plan.
As a result, BREIT fulfilled repurchase requests totaling just $1.3 billion of the estimated $5 billion in total that investors sought to redeem.
“We remain confident that BREIT’s portfolio can deliver strong performance and a tax-advantaged distribution yield,” BREIT stated in its letter to stockholders. “We believe we have selected the right sectors and geographies and positioned our balance sheet to continue to produce meaningful cash flow growth. In fact, BREIT’s portfolio experienced estimated [year-over-year] market rent growth of approximately 10% in December.”
Blackstone REIT, for the first time in its six-year history, began to gate redemption requests in November, after a flood of repurchase requests from investors exceeded the 5% quarterly limit of the company’s net asset value.
In January, the REIT was buoyed by the announcement of a $4 billion investment from the University of California endowment, which was later increased by an additional $500 million investment.
According to Blackstone, BREIT has generated a 12.5% annualized net return since its inception in January 2017 and an 8.4% net return in 2022 that was supported by 13% estimated cash flow growth “despite a challenging environment.”
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