Blackstone Real Estate Income Trust Inc., a publicly registered non-traded REIT sponsored by private equity giant The Blackstone Group (NYSE: BX), provide an stockholder update, summarizing the company’s results during the second quarter of 2023.
“We are proud that BREIT has delivered strong performance for our investors across market cycles: +1.8% in the second quarter and a +12% annualized net return (Class I) since inception over six years ago, nearly triple the return of the publicly traded REITs,” says the company. “Our outperformance has always been grounded in using the Blackstone platform’s vast data and insights to invest behind secular shifts and see around corners to construct a high conviction portfolio.”
BREIT’s portfolio has generated an estimated 7%+ cash flow growth year-to-date, more than double inflation today. The company is the largest owner of student housing in the United States, an all-weather sector where accelerating supply and demand fundamentals are driving outsized market rent growth of +9% year-over-year. Regarding the industrial sector, BREIT says the combination of this secular shift to e-commerce and onshoring of manufacturing has resulted in record low vacancy of 3% and leases being signed at 43% higher rents than expiring leases.
Currently, BREIT’s top two markets are Florida and Texas, where BREIT’s recent $800 million sale of a hotel asset in Texas, the JW Marriott San Antonio, resulted in a profit of $275 million.
Since proration began in November 2022, the company has paid out $8.1 billion to redeeming shareholders and “a shareholder who began submitting repurchase requests when proration began has received over 90% of their money back.”