Shareholders Tried to Withdraw $4.5B From Blackstone’s REIT in March

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Shareholders asked to get $4.5 billion out of Blackstone’s $70 billion real estate investment trust (REIT) in March, as the landlord restricted its redemptions for the fifth consecutive month.

Blackstone Real Estate Income Trust (BREIT) let stockholders withdraw about 15 percent of what they requested, or about $666 million in shares, amid “a month of tremendous market volatility and broad-based financial stress,” Blackstone (BX) wrote in a letter to investors Monday, first reported by Bloomberg

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Blackstone’s stock fell 4.2 percent to $84.12 per share Monday morning.    

The privately traded REIT has faced a rush of investors pulling out money since the end of last year as stockholders try to reduce their exposure to the volatile real estate market. BREIT hit its monthly redemption limits in January and February, when shareholders attempted to extract more than $5 billion and $3.9 billion, respectively.  

BREIT has paid out nearly $5 billion to shareholders since Nov. 30, and Jeffrey Kauth, a spokesperson for Blackstone, touted that the REIT paid investors a 12.3 percent annualized net return since its founding in 2017.

“Strong performance is what matters, and BREIT has delivered,” Kauth said. “As for March redemptions, they remain 16 percent below their January peak despite elevated market volatility.”

In February, BREIT’s lowest-fee share class posted its biggest monthly total return to investors in six months, recording a return of 0.7 percent as multifamily rents in its portfolio rose despite a decline in property valuations, Bloomberg reported. 

BREIT’s portfolio, marketed mostly to wealthy individuals, consists largely of rental housing, industrial space and data centers concentrated in the Southern and Western United States, according to its website. It makes up roughly 17 percent of Blackstone’s overall earnings, Reuters reported. 

Celia Young can be reached at cyoung@commercialobserver.com.