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Blackstone is an American financial
giant with over $1 trillion in
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assets under management.
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What we do is we buy assets,
say we buy a company,
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and we make them better.
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Real estate is one of Blackstone's
major divisions.
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Blackstone is really in the
business of marketing investment
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products. A byproduct of that is
they became a very large landlord.
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The company has an ownership
interest in at least 274,000 rental
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housing units. That likely makes it
one of the largest landlords in the
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United States.
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In every market where we operate.
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We own less than 1% of of the
housing available.
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Their portfolio of rental housing
is concentrated in Sunbelt regions
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like Texas, Georgia and Florida.
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Many of these units are apartments.
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A smaller portion are single family
homes.
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The company also has stakes in
mobile home parks,
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student housing,
and more.
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I have to give credit because they
went after,
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you know, like apartment housing
and sort of residential housing,
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as opposed to going into,
you know,
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malls or retail side of the
business,
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which is really just a struggle.
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Rents keep rising in many parts of
the US,
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particularly major cities that
aren't building enough housing.
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As a result, some cities are
considering policies that protect
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tenants from rent hikes.
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If these measures pass,
they could affect Blackstone's
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bottom line.
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I just think that it's time for the
landlords to accept that they can't
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always make as much as they would
like.
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So how did Blackstone become one of
the largest landlords in the United
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States?
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Most of the rentals Blackstone owns
are in massive multifamily
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buildings. Take,
for example, Stuyvesant Town Peter
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Cooper Village. Blackstone acquired
this property in 2015.
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Stuy Town is a city within the
city.
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It was built in 1947 for returning
veterans.
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There are 11,242 units and
approximately 30,000 residents.
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Today, all of the apartments in
Star Town are rent stabilized.
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That's a big benefit for long term
tenants like Susan.
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She pays significantly less than
the market rate of rent in New York
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City.
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I moved into Stuyvesant Town in
January of 1980,
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after having been on the waiting
list for a little more than three
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years.
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But the rents at Stuy Town have
climbed over the years.
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Just dealing with one bedrooms and
one bathrooms like I have.
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The rents now start at more than
4700 and they go up depending on
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where the apartment is located.
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In 2020, the tenants at Stuy Town
sued their landlord.
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Their claim: Blackstone's
subsidiary planned to convert units
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to market rates,
raising rents beyond what the city
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allows for stabilized units.
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The New York State Supreme Court
reviewed the case and ruled in
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favor of the tenants.
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Blackstone withdrew its protest of
the findings following court orders
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in 2024. Still, the company sees
rent control policies as a risk.
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What we see consistently across the
globe is that policies that focus
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on rent restrictions actually have
a counterproductive outcome in that
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they really lead to higher housing
costs overall.
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Restrictive policies really chill
the environment as far as
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encouraging new development and
even investment in existing
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housing.
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When Blackstone buys property,
it tends to spend a lot of cash
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improving their asset.
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The video intercom system was
something that Blackstone
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installed. They've improved
elevators.
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We've invested $425 million of
capital since we acquired Sky town.
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That shows up in lots of different
ways.
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Everything from the quality of the
apartments themselves.
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We have created a new bedrooms and
many,
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many of them. It's like the
equivalent of creating a whole new
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building. When you look at the
number of bedrooms we've been able
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to add.
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This can in some cases lead to an
increase in rent.
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I think that Blackstone had a
vision for their ownership of the
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property, which was not always the
best in terms of property
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management. The people that they
hired came from the leisure
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industry or the hotel industry.
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There are a lot of fun things that
Blackstone did.
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I mean, there are times when you
walk out on a summer evening and
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there are movies going on and
people are lying around in the
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oval. On the other hand,
the tenants association gets calls
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from tenants that are going crazy
because they have an unusable sink
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and they can't get an appointment
for a month to do something about
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it. Those are the kind of basics
that we really like,
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maybe more than having ice cream
available on site.
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In response, Blackstone told CNBC
that it reduced Stuy Town's average
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work order time by 65% since 2015.
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A work order is a document that
provides detail for a maintenance
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request.
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Blackstone makes money by charging
fees for managing their various
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funds. Their stock has outperformed
the broader market over the past
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five years.
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They make money in two ways,
really.
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There are what we call assets under
management fees.
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So they get a certain percent each
year of the assets they manage.
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And then if the assets pose
significant returns,
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they get what are called
performance fees or incentive fees.
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Blackstone was founded by Peter
Peterson and Stephen Schwarzman in
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1985. The investment bankers met
while working together at Lehman
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Brothers.
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When we started in 1985,
there weren't diversified private
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equity firms. Basically,
there were just about 7 or 8 firms
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that just did leveraged buyouts.
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It's a slightly different business
than it was maybe 20 years ago.
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The old knock against,
you know, the private equity guys
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was they buy up companies.
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They load a ton of debt on them.
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They pay themselves a huge dividend
and they, you know, throw them out
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to the market. That model really
sort of stopped.
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Since 1991, Blackstone raised funds
for the private side of its real
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estate division at least ten times.
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They've been investing in real
estate assets for decades,
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most of that through what are
called private placements.
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These private placements are real
estate investment opportunities
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available only to accredited
investors.
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That actually is the bulk of
Blackstone's real estate
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investments right now.
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Of their $315 billion in real
estate,
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only roughly $55 billion is in the
breed product,
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which is sold to retail investors.
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BREIT, Blackstone's Real Estate
Income Trust,
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has significant interests in
industrial developments,
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data centers, and,
of course, rental housing.
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Many investors put money into the
fund coming out of the pandemic.
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But the pace of new investments
into brick has slowed since 2022,
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with at least one notable
exception.
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A $4 billion investment from the
University of California.
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Breit had posted smooth returns
every month for six years.
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Breit is a perpetual capital fund
which holds for the long term.
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Blackstone holds town in another
perpetual fund,
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but it's not included in BREIT.
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The community didn't know from one
day to the next who was going to
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own it. The then mayor of the city,
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Bill de Blasio, determined that it
would be good to sell it to a
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developer who was going to be in it
for the long term,
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and that's where Blackstone came
in.
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Blackstone says its U.S.
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portfolio is concentrated where it
believes opportunities are highest.
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There tends to be a high degree of
consistency across our different
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pools of capital. As far as the
nature of the investments,
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meaning which sector,
warehouses, apartments,
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data centers, and then the
geographies as well.
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Really what we try to follow across
the globe is job and population
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growth. And that is part of why you
see meaningful concentrations in
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the Sun Belt and also urban areas
on the coast.
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Blackstone was an early pioneer in
the market for single family rental
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homes.
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Remember, after the crisis,
they quickly became the largest
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owner of single family homes in the
country.
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They brought them all together.
Then they created a company called
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Invitation Homes. They took it
public and then they got out of it.
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They really had,
I would say, the best period
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following the financial crisis,
because they were actually able to
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out there and sort of snatch up
properties that have become
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distressed.
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In 2021, Blackstone reentered the
single-family rental space with
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another major acquisition:
Home Partners of America.
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Home Partners of America offered a
lease to purchase program,
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which was criticized by some in the
industry.
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In 2025, they shuttered that
company.
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Where we have leased to purchase
agreements. We continue to honor
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those agreements. I think the
challenge in the housing market
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today is that high borrowing costs
make it more difficult for folks to
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convert a lease into being a
homeowner.
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Blackstone today is building its
single family portfolio with Tricon
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Residential. The company was
acquired in 2024.
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We purchased Tricon in a private
transaction.
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It was publicly traded both in the
US and Canada and really had been
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undervalued in the public markets.
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Today, Blackstone's single family
rental portfolio contains about
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58,000 properties.
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The company says it's building
thousands of new homes across the
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US.
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A lot of them still have so much
dry powder sitting there,
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and they can sort of take advantage
of the situations when they arise.
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Buying is still cheaper than
building in many markets,
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according to analysts at MetLife
Investment Management.
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As a result, construction is
limited and rents are poised to
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keep growing.
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As the rate of new housing permits
and construction starts sink.
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Market rate rents could increase at
a relatively fast pace.
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That's a major issue in cities like
New York,
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where rental prices are already
near record highs.
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This city can build plenty of
affordable housing,
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and this city needs to be livable.
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We're going to be losing people
left,
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right and center if something
doesn't happen.
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Policymakers concerned with the
soaring cost of rent increased how
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much they'll spend on building low
income housing properties.
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That's a boost for Blackstone's
affordable housing initiative.
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April housing April Housing started
with about 70,000 government
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subsidized housing units.
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When the renovations are complete.
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Blackstone expects to be the single
largest provider of affordable
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housing in the United States.
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We're feeling like we're just
getting started.
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We're preserving units.
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We're doing that by extending the
affordability through new
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syndications of tax credits.
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That also allows us to invest in
the communities at no cost to the
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resident, and we're just starting
to build new communities as well in
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different parts of the country.
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Bringing private capital into
subsidized housing could be a net
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positive. The vacancy rate for
affordable projects is higher than
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the rest of the market.
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I just focus on the fact that we
are a large owner,
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and with that scale brings the
ability to have consistency of the
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quality of the rental housing that
we operate and the new supply that
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we can help create,
both by being an equity investor in
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new development,
and that capital is really critical
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to addressing the supply and demand
shortage we have in this country.
