Scott Trebilco, Chris Graham, Jimmy Yung and JT Sizemore
Senior managing director and managing director at Blackstone Real Estate; managing directors at Blackstone Real Estate Debt Strategies
Blackstone had over $1 trillion in assets under management as of July this year, and, while some of their assets have been more attractive than others, Southern California continues to fit the company’s description of a good investment.
Scott Trebilco, along with Chris Graham, Jimmy Yung and J.T. Sizemore, said part of the corporation’s larger strategy has been about recycling capital — as with the $800 million sale of the JW Marriott San Antonio Hill Country Resort & Spa in June — toward the travel and leisure sectors as well as student housing, industrial spaces and data centers.
“People’s desire to spend more on experiences versus goods has been an upward-sloping trend, just the sophistication of how efficient you can be while mobile has really changed the way people think about living their lives,” Trebilco said. “That’s led us to be focused more on coastal markets.”
Though not necessarily on traditional urban markets, which have performed under “very different trends,” Trebilco said.
To wit, Blackstone’s broader dealings beyond Trebilco’s deals saw the April sale of the Griffin Towers office buildings in Orange County at a 36 percent loss.
“We aim to invest in sectors with strong fundamentals propelled by macro demand trends… That are experiencing double-digit year over year market rent growth, and why less than 2% of our owned portfolio is traditional U.S. office,” Trebilco said.
In the sprawl that is Blackstone, their Blackstone REIT was still able to achieve its strongest-performing month in almost a year in June. Blackstone is also further expanding into film studios, having purchased a 49 percent stake in Hudson Pacific Properties’ $200 million film and TV space near Hollywood’s Sunset Las Palmas complex. Blackstone seems to like anything related to content creation, whether or not writers and actors are on strike.
“That’ll hopefully get resolved here over the near term. Obviously, it’s created a lot of disruption now to the market, but we view it as a short-term disruption,” Trebilco said. “The long-term fundamentals in the space are incredibly strong, and people’s continued desire to consume things through the media really plays into some of the broader trends that we’re focused on around data center space, the adoption of AI, all of which are feeding into these mega trends that we’re trying to take advantage of.”
