Blackstone’s BREIT Eyes Colo Acquisition with New $14B of Fund Investments

(Bloomberg) -- The Blackstone Inc. real estate investment trust that limited investor withdrawals after a surge in redemptions last year said it now has about $14 billion of liquidity and is gearing up to hunt for deals.

“We have ample capital to play offense in a world where we think there’s going to be some interesting deployment opportunities,” Nadeem Meghji, Blackstone’s head of Americas real estate, said Tuesday during a stockholders meeting for Blackstone Real Estate Income Trust. 

Blackstone cemented its stature as a powerhouse in the real estate industry with the growth in BREIT in recent years. But the $69 billion trust came under pressure as markets turned last year and more investors wanted out. BREIT still has a backlog of withdrawal requests to address, Meghji said. 

“We’re mindful of what we see as elevated repurchase activities and we need to work through that backlog over the next couple of months,” Meghji said.

BREIT received a $4.5 billion infusion from the University of California’s regents in January, helping meet demand for redemptions and make new deals, he said.

The fund is targeting publicly traded real estate investment trusts, which are trading at discounts, he said. BREIT is also lending to borrowers who need new property financing, taking advantage of higher rates, he said. 

The trust is talking to “motivated sellers” with attractive properties that need to raise capital for other purposes, he said. It’s also looking at buying more data centers because of continued demand for cloud computing, he added.

Almost 80% of BREIT’s current portfolio is in residential and industrial properties, which Meghji said will continue to deliver rising rents and higher cash flow because of a long-term supply shortage.