Blackstone Asia Fund Reaches $6.38B With Florida Pension Boost

Private equity giant Blackstone secured a $100 million commitment for its third Asia property fund from the state of Florida in the fourth quarter of 2021, part of nearly $2.4 billion in fresh commitments to the vehicle during the period.

Florida’s State Board of Administration, which manages the assets of the Florida Retirement System and other funds, revealed the commitment to Blackstone Real Estate Partners Asia III in a quarterly update made available online.

Launched last year, BREP Asia III had capital commitments totalling $6.38 billion as of 31 December 2021, according to Blackstone’s earnings report released last month.

The Manhattan-based fund manager continues to rake in commitments despite a new report from data provider Realfin showing that capital raised by APAC-focused funds fell sharply for the whole of 2021.

States Step Up

Jonathan Gray, Blackstone’s president and chief operating officer, announced last October that BREP Asia III had closed on $4 billion and was expected to raise $9 billion in total.

In November, Mingtiandi reported that the Teachers’ Retirement System of Illinois had pledged to invest $100 million in BREP Asia III. The TRS has been an active investor of funds managed by Blackstone, with $620 million of its total $9.6 billion real assets portfolio handled by the NYSE-listed group.

BREP Asia III was scheduled to receive another $100 million in backing from the Minnesota State Board of Investment, a public pension fund, according to a report by IPE Real Assets last August.

The previous fund in the series, BREP Asia II, had bagged $7.1 billion in capital commitments at its final closing in 2017, following BREP Asia’s $5 billion final closing in 2014.

Blackstone’s bullishness on Asia also extends beyond real estate: the group’s private equity chief for the region told Bloomberg last month that Blackstone has amassed $11 billion to buy companies in Asia after raising its second private equity fund focused on the region.

Off Year for Raisings

Even as Blackstone and rivals GLP, Nuveen and Warburg Pincus announced big wins for their funds, capital raised by APAC-focused real estate vehicles in 2021 fell by nearly 30 percent year-on-year to $25.04 billion, according to Realfin.

In its State of the Market report on global real estate, the data provider said 2021’s decline was the sharpest in the region since the global financial crisis, when fundraising plunged 74.1 percent in 2009.

Last year saw the greatest amount of APAC-focused capital raised for value-add funds, with 40.7 percent of the total, followed by debt (20.9 percent), core (14.3 percent), opportunistic (12.5 percent) and core-plus (11.6 percent).

Diversified strategies raised the majority of capital, 53.5 percent, followed by those focused on industrial (32.6 percent), residential (11 percent), retail (2.2 percent) and office (0.7 percent), Realfin said.