[ad_1]
Andriy Yalansky
Jon Gray, Blackstone (New York Stock Exchange: BX)’s president and COO on Thursday said headwinds from rising interest rates had made it a “challenging” quarter for its segment in the real estate sector.
But Gray said CNBC said the higher cost of capital in the long run would limit the amount of new supply that could hit the market. “It’s a tailwind for real estate,” he said.
“We’ve been adjusting it [higher interest rates] in higher cap rate portfolios. But if you look within the asset class, it’s very dramatic. If you look at the US office market, the difference including subleasing is now over 20% and rents are falling, which makes it a very challenging sector,” Gray added.
Given the difficult market conditions in 2022, the company has put most of its capital into travel and travel-related businesses, logistics, hedge fund businesses, quantitative and macro investments, energy and the energy transition, reports Gray. .
As a result, the company’s revenues increased 8% in the fourth quarter and assets under management increased 11%. Segment Performance: Real Estate – Opportunistic -2.0%; Core -1.5%; Private Equity – Corporate Private Equity +3.8%; Tactical Opportunities +0.6%; Secondary -1.8%; Hedge Fund Solutions – +2.1%; and Insurance – Private Credit +2.4%. Liquid credit +3.0%.
However, alternative asset managers fell short of expectations of reaching $1 trillion in AUM by the end of 2022. It reported AUM of $975 billion, up from $951 billion in the previous quarter.
Looking at the stock action, BX is trading at $92.49 in Thursday’s intraday move, up more than 4% in the earnings call.
Stocks are falling in the long run 17.3% in the last 12 months, twenty one% In 2023 it is increasing so far.
Meanwhile, see why Seeking Alpha contributor Samuel Smith says, “As interest rates rise, investors generally shy away from BX real estate and private equity products (and valuations decline).” please.
A quick comparison between BX and the broader market index:
[ad_2]
Source link
