Blackstone Exceeds Q2 Earnings Estimates, Sparked by Real Estate
The private equity giant netted $52.1 billion of inflows during the second quarter including $7.2 billion in Blackstone's real estate funds.
By Andrew Coen July 24, 2025 12:21 pm
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Blackstone exceeded earning expectations in the second quarter, spurred by growth in its real estate platform despite choppy market conditions.
The private equity giant reported earnings per share of $1.21, which beat analysts’ estimates of $1.09.
Blackstone netted $52.1 billion of inflows during the second quarter compared with $61.6 billion in the previous quarter. That activity included $7.2 billion in Blackstone’s real estate funds, including $1.1 billion in BREIT, the firm’s non-listed real estate investment trust (REIT).
Jonathan Gray, Blackstone’s president and chief operating officer, said during Thursday’s earnings call BREIT had its best quarterly fundraising performance in two and a half years.
Gray noted that Blackstone’s real estate business is poised for growth because of a large drop in new supply working its way through the system. He added that real estate market spreads have come down to levels seen before President Donald Trump’s April 2 Liberation Day tariff announcement and are down significantly from their widening seen in 2023.
“Because of the two-thirds decline in building in the U.S. from the peaks in terms of logistics and apartment construction, you’re going to begin as we get towards the end of this year and into next year to have a much more favorable supply-demand dynamic,” Gray said. “If [interest] rates come down faster, obviously the recovery is quicker. If they don’t, then new supply will continue to be muted and the recovery will take a little more time, but ultimately we know the path to travel.”
Assets under management (AUM) rose to $1.21 trillion in the quarter, a 13 percent jump compared to a year ago. Fee-earning AUM jumped 10 percent from the 2024 second quarter to $887.1 billion.
Michael Chae, the company’s vice chairman and chief financial officer, said values in Blackstone’s real estate funds were “largely stable” during the second quarter, powered by strength in data centers within its core-plus platform. Chae said its real estate platform is “well positioned” with roughly 75 percent of the portfolio comprising data centers, logistics facilities and rental housing.
The Blackstone Property Partners real estate fund saw $45 million in net accrued performance revenues in the second quarter, a 38.3 percent drop from the year-ago period. Chae said the decrease was driven largely by Blackstone’s life sciences portfolio, which he said has faced market headwinds due to new supply coming online and increased “tenant caution.”
Despite some softening in the life sciences sector overall in recent years, Gray said there is strong potential for the asset class with new demands sparked by changes to the industry from artificial intelligence (AI). Gray noted that while the Trump administration’s cuts to government-funded science research adds more “uncertainty” to life sciences, a big drop in new construction in the sector from its peak a few years ago will draw more demand.
“There is just enormous innovation happening in life sciences that AI is likely to accelerate,” Gray said. “The need for these products is substantial and the number of groups with expertise at scale to do these partnerships is limited, so we still see a very big investment opportunity here.”
Andrew Coen can be reached at acoen@commercialobserver.com.
