April 25, 2024
Investment

Blackstone Prepares for Massive Real Estate Investment Drive With Leadership Changes


Blackstone is readying for another massive global investment drive, including into real estate, with a series of promotions and leadership changes.

The private equity giant has promoted Ken Caplan, global co-head of real estate, and Lionel Assant, European head of private equity, to newly created roles as global co-chief investment officers.

Nadeem Meghji, head of real estate Americas, will succeed Caplan as global co-head of real estate alongside current global co-head Kathleen McCarthy.

Blackstone said the promotions “underscored the increasing breadth of its investment strategies and continued expansion”, having recently surpassed $1 trillion in assets under management. It said the three executives have more than 60 years of collective experience investing for Blackstone and would lead an extremely active period of investment, with over $200 billion of dry powder to spend.

Steve Schwarzman, co-founder, chairman and CEO of Blackstone, said the promotions readied the business for major investment. “They bring strong track records of delivering for our customers, considerable institutional knowledge, and exceptional investment acumen to these new roles.”

Caplan joined Blackstone in 1997, led the firm’s European real estate business from 2012-2015, served as real estate CIO from 2015-2017, and has co-headed the global real estate business alongside McCarthy since 2018. As co-CIO, he will work in conjunction with the business unit CIOs and group heads to provide additional investment oversight, primarily across real estate and credit & insurance.

Assant joined Blackstone in 2003 and has run the firm’s European private equity business based in London since 2012. He will continue to serve in that capacity and, as co-CIO of Blackstone, work in conjunction with the business unit CIOs and group heads to provide additional investment oversight across its private equity complex, including its corporate PE, infrastructure, tactical opportunities, growth and life sciences businesses.

Meghji joined Blackstone Real Estate in 2008 and since 2017 has overseen its real estate business in the Americas. He has helped oversee the growth of Blackstone’s US and Canadian real estate business across its opportunistic (BREP), institutional and private wealth core-plus (BPP and BREIT) strategies, with over $200 billion of AUM and total asset value of $400 billion.

The firm has also promoted Gio Cutaia to be global chief operating officer of real estate. He will continue to lead global real estate asset management, a role he has held since 2018, and in that capacity helps manage the over 12,000 assets in Blackstone’s real estate portfolio.

Kathleen McCarthy, global co-head, real estate, said in a statement: “Nadeem is the perfect leader to succeed Ken, given his tremendous investment acumen and operational experience. I am excited to partner with him in the years ahead. Nadeem and I are thrilled to elevate Gio Cutaia, who will play a critical role helping us oversee this world-class business.”

CIOs across Blackstone will continue to report into their respective business units. Prakash Melwani, CIO of Corporate Private Equity, who will have an expanded role as chairman of Blackstone Capital Partners International.

Blackstone has been notably bullish recently about its commitment to real estate and the sectors it is targeting.

As reported by CoStar in a recent wider report on private equity funds reading major war chests to spend into a recovering market, Jon Gray, Blackstone’s president, hinted at a potential spending spree in the company’s third-quarter earnings call.

“Ultimately, there will be real estate to buy and real estate to sell, and with our $66 billion of dry powder, I think we’re going to be in a really unique position,” Gray said. “I mean, we raised this $30 billion plus global fund. I think we’ve invested less than 5% of that fund today. We have the vast majority of our Asia fund uninvested, and our Europe fund we’re just raising, so by definition is uninvested. So, we think we’re well-positioned in this environment, particularly if banks pull back and there are liquidity shortfalls.”

At its second quarter earnings it confirmed Europe and in particular logistics were among its favoured real estate target investments.

In April, Blackstone Group said the final close of its latest global real estate fund, Blackstone Real Estate Partners X, with $30.4 billion of total capital commitments, was the largest real estate or private equity drawdown fund raised on record.

The world’s largest property owner added then that its three opportunistic strategies — global, Asia and Europe — had over $50 billion of capital commitments. With the large influx of capital, Blackstone has stated on multiple occasions it no longer intends to invest in traditional property sectors, such as retail or office, which have been hit by the remote working trend.



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