Blackstone (BX) 8-K Blackstone Reports Fourth Quarter and Full Year 2017 Results

Exhibit 99.1

Blackstone Reports Fourth Quarter and Full Year 2017 Results

New York, February 1, 2018: Blackstone (NYSE:BX) today reported its fourth quarter and full year 2017 results.

Stephen A. Schwarzman, Chairman and Chief Executive Officer, said, “I’m proud to share results from a truly exceptional year for Blackstone, reflected by outstanding earnings growth and record capital activity that drove our highest-ever level of aggregate cash distributions to shareholders. In 2017, we took in $108 billion of capital inflows, invested more than $50 billion, and returned more than $55 billion to our limited partner investors through realizations – all new records for the firm. At the same time, Blackstone’s tireless drive to innovate has enabled us to launch large-scale new product areas that reach a wider client base and serve existing clients in new ways, including through more permanent capital vehicles. Our investors in turn have entrusted us with more capital than ever before, leading to a new record total assets under management of $434 billion, up 18% year-over-year.”

Blackstone issued a full detailed presentation of its fourth quarter and full year 2017 results, which can be viewed atwww.blackstone.com.

Distribution

Blackstone has declared a quarterly distribution of $0.85 per common unit to record holders of common units at the close of business on February 12, 2018. This distribution will be paid on February 20, 2018.

Quarterly Investor Call Details

Blackstone will host a conference call on February 1, 2018 at 11:00 a.m. ET to discuss fourth quarter and full year 2017 results. The conference call can be accessed via the Investors section of Blackstone’s website atwww.blackstone.com or by dialing +1 (877) 391-6747 (U.S. domestic) or +1 (617) 597-9291 (international), pass code 149 943 55#. For those unable to listen to the live broadcast, a replay will be available onwww.blackstone.com or by dialing +1 (888) 286-8010 (U.S. domestic) or +1 (617) 801-6888 (international), pass code 893 174 64#.

About Blackstone

Blackstone is one of the world’s leading investment firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, and the communities in which we work. We do this by using extraordinary people and flexible capital to help companies solve problems. Our asset management businesses, with over $430 billion in assets under management, include investment vehicles focused on private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds, all on a global basis. Further information is available atwww.blackstone.com. Follow Blackstone on Twitter@Blackstone.

The Blackstone Group L.P.

345 Park Avenue

New York, New York 10154

T 212 583 5000

Forward-Looking Statements

This release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 which reflect Blackstone’s current views with respect to, among other things, Blackstone’s operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Blackstone believes these factors include but are not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange Commission, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the filings. Blackstone undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

This release does not constitute an offer of any Blackstone Fund.

Investor and Media Relations Contacts

Joan Solotar Blackstone Tel: +1 (212)583-5068 solotar@blackstone.com Weston Tucker Blackstone Tel: +1 (212)583-5231 tucker@blackstone.com Christine Anderson Blackstone Tel: +1 (212)583-5182 Christine.Anderson@blackstone.com

2

February 1, 2018

Blackstone’s Fourth Quarter and Full Year

2017 Earnings

Blackstone

1

Blackstone’s Fourth Quarter and Full Year 2017 GAAP Results

GAAP

Net

Income

was

$763

million

for

the

quarter,

and

$3.4

billion

for

the

year.

GAAP

Net

Income

Attributable

to

The

Blackstone

Group

L.P.

was

$282

million

for

the

quarter

and

$1.5

billion

for

the

year.

n/m = not meaningful. The enactment of the Tax Cuts and Jobs Act in 4Q’17 resulted in income of $404 million related to a reduction to the Tax Receivable Liability and an increase in

the Provision for Taxes of $501 million due to a partial reversal of Deferred Tax Assets.

% Change

% Change

(Dollars in Thousands, Except per Unit Data) (Unaudited)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Revenues

Management and Advisory Fees, Net

630,092

$           

719,687

$           

14%

2,442,975

$        

2,729,056

$        

12%

Performance Fees

Realized Carried Interest

416,197

1,357,029

226%

1,474,830

3,439,754

133%

Realized Incentive Fees

82,382

185,420

125%

170,537

374,571

120%

Unrealized Carried Interest

239,224

(443,581)

n/m

481,304

(100,477)

n/m

Unrealized Incentive Fees

3,760

(107,095)

n/m

49,660

(8,692)

n/m

Total Performance Fees

741,563

991,773

34%

2,176,331

3,705,156

70%

Investment Income (Loss)

Realized

106,350

184,562

74%

278,737

635,769

128%

Unrealized

9,967

(20,567)

n/m

77,314

42,605

(45)%

Total Investment Income

116,317

163,995

41%

356,051

678,374

91%

Interest and Dividend Revenue

28,544

40,524

42%

95,724

139,696

46%

Other

52,853

(33,781)

n/m

54,753

(133,229)

n/m

Total Revenues

1,569,369

1,882,198

20%

5,125,834

7,119,053

39%

Expenses

Compensation and Benefits

Compensation

304,347

364,484

20%

1,335,408

1,442,485

8%

Performance Fee Compensation

Realized Carried Interest

141,443

531,067

275%

455,954

1,226,561

169%

Realized Incentive Fees

33,286

69,627

109%

78,096

160,683

106%

Unrealized Carried Interest

137,591

(151,899)

n/m

312,838

105,372

(66)%

Unrealized Incentive Fees

1,489

(40,931)

n/m

21,134

(4,286)

n/m

Total Compensation and Benefits

618,156

772,348

25%

2,203,430

2,930,815

33%

General, Administrative and Other

141,954

129,236

(9)%

520,309

466,316

(10)%

Interest Expense

41,142

74,606

81%

152,654

197,486

29%

Fund Expenses

23,232

32,692

41%

52,181

132,787

154%

Total Expenses

824,484

1,008,882

22%

2,928,574

3,727,404

27%

Other Income

Reversal of Tax Receivable Agreement Liability

-

403,855

n/m

-

403,855

n/m

Net Gains from Fund Investment Activities

73,510

81,963

11%

184,750

321,597

74%

Income Before Provision for Taxes

818,395

$           

1,359,134

$        

66%

2,382,010

$        

4,117,101

$        

73%

Provision for Taxes

48,087

596,590

n/m

132,362

743,147

461%

Net Income

770,308

$           

762,544

$           

(1)%

2,249,648

$        

3,373,954

$        

50%

Net Income Attributable to Redeemable Non-Controlling Interests in Consolidated Entities

1,663

7,600

357%

3,977

13,806

247%

Net Income Attributable to Non-Controlling Interests in Consolidated Entities

58,684

132,364

126%

246,152

497,439

102%

Net Income Attributable to Non-Controlling Interests in Blackstone Holdings

342,010

340,992

(0)%

960,284

1,391,879

45%

Net Income Attributable to The Blackstone Group L.P. ("BX")

367,951

$           

281,588

$           

(23)%

1,039,235

$        

1,470,830

$        

42%

Net Income per Common Unit, Basic

0.56

$                  

0.42

$                  

(25)%

1.60

$                  

2.21

$                  

38%

Net Income per Common Unit, Diluted

0.55

$                  

0.42

$                  

(24)%

1.56

$                  

2.21

$                  

42%

Blackstone

2

Blackstone’s Fourth Quarter and Full Year 2017 Segment Highlights

Economic

Net

Income

(“ENI”)

was

$850

million

($0.71/unit)

in

the

quarter,

up

5%

year-over-year,

on

$1.8

billion

of

Total

Segment

Revenues.

•

ENI

was

$3.4

billion

($2.81/unit)

for

the

year,

up

41%

year-over-year,

on

$6.8

billion

of

Total

Segment

Revenues.

Distributable

Earnings

(“DE”)

was

$1.2

billion

($1.00/unit)

in

the

quarter,

up

94%

year-over-year,

driven

by

$1.5

billion

of

Realized

Performance

Fees.

•

DE

was

a

record

$3.9

billion

($3.17/unit)

for

the

year

on

$3.8

billion

of

Realized

Performance

Fees.

Fee

Related

Earnings

(“FRE”)

was

$328

million

in

the

quarter,

up

11%

year-over-year,

on

$732

million

of

Net

Management

and

Advisory

Fees.

•

FRE

was

a

record

$1.2

billion

for

the

year,

up

21%

year-over-year,

on

$2.8

billion

of

Net

Management

and

Advisory

Fees.

Total

Assets

Under

Management

(“AUM”)

grew

to

a

record

$434.1

billion

through

a

combination

of

continued

fundraising,

fund

appreciation,

and

strategic

platform

expansion.

•

Inflows

were

$62.2

billion

in

the

quarter,

including

$22

billion

from

Fidelity

&

Guaranty

Life

and

$11

billion

from

the

acquisition

of

Harvest,

bringing

full

year

inflows

to

a

record

$108.0

billion.

•

Total

AUM

increased

18%

year-over-year

and

Fee-Earning

AUM

was

up

21%

to

$335.3

billion.

Quarterly

and

annual

capital

deployed

records

of

$19.5

billion

and

$50.7

billion,

respectively.

Blackstone

declared

a

fourth

quarter

distribution

of

$0.85

per

common

unit

payable

on

February

20,

2018.

The changes in carrying value, fund returns and composite returns presented throughout this presentation represent those of the applicable Blackstone Funds and not those of The

Blackstone Group L.P.

Blackstone

3

Blackstone’s Fourth Quarter and Full Year 2017 Segment Earnings

% Change

% Change

(Dollars in Thousands, Except per Unit Data)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Management and Advisory Fees, Net

635,892

$          

732,392

$          

15%

2,462,993

$       

2,770,791

$       

12%

Performance Fees

741,903

992,758

34%

2,177,986

3,708,124

70%

Investment Income

99,282

55,737

(44)%

220,290

304,988

38%

Interest Income and Dividend Revenue

28,544

42,836

50%

96,399

142,920

48%

Other

52,839

(35,151)

n/m

54,712

(140,051)

n/m

Total Revenues

1,558,460

1,788,572

15%

5,012,380

6,786,772

35%

Total Expenses

713,600

902,192

26%

2,531,096

3,309,150

31%

Taxes

33,250

36,006

8%

92,263

101,531

10%

Economic Net Income

811,610

$          

850,374

$          

5%

2,389,021

$      

3,376,091

$      

41%

ENI per Unit

0.68

$                

0.71

$                

4%

2.00

$                

2.81

$                

41%

Fee Related Earnings

294,495

$          

327,586

$          

11%

1,021,688

$       

1,236,219

$       

21%

Distributable Earnings

638,994

$          

1,239,146

$      

94%

2,121,575

$      

3,876,215

$      

83%

DE per Common Unit

0.51

$                

1.00

$                

96%

1.73

$                

3.17

$                

83%

Total AUM

366,553,465

$  

434,128,243

$  

18%

366,553,465

$  

434,128,243

$  

18%

Fee-Earning AUM

277,092,672

$  

335,343,998

$  

21%

277,092,672

$  

335,343,998

$  

21%

See note on page 13 regarding Total Segment measures.

Blackstone

4

Private Equity

17.6%

FY’17 Increase in Corporate

Private Equity Carrying Value

$4.4 billion

4Q’17 Realizations

$105.6

billion

Total AUM up 5% YoY

Corporate

Private

Equity

carrying

value

increased

6.8%

in

the

quarter

and

17.6%

for

the

year

driven

by

broad

based

appreciation

in

the

private

portfolio

and

public

holdings.

Realizations

of

$4.4

billion

in

the

quarter

were

driven

by

private

company

sales

in

Corporate

Private

Equity,

and

strong

activity

across

Tactical

Opportunities

and

Strategic

Partners,

bringing

full

year

realizations

to

$15.8

billion.

Invested

$4.9

billion

in

the

quarter,

including

the

first

deal

in

the

recently

raised

Asia

fund

and

deployments

in

Tactical

Opportunities

and

Strategic

Partners.

•

Committed

an

additional

$2.3

billion

during

the

year

that

has

not

yet

been

deployed.

Total

AUM

inflows

of

$5.0

billion

and

portfolio

appreciation

in

the

quarter

drove

Total

AUM

to

$105.6

billion.

Net

Management

and

Advisory

Fees

of

$764

million

for

the

full

year,

up

36%

year-over-year

primarily

due

to

a

full

year

of

management

fees

from

BCP

VII.

% Change

% Change

(Dollars in Thousands)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Management and Advisory Fees, Net

157,467

$         

202,099

$         

28%

560,066

$         

764,435

$         

36%

Performance Fees

253,547

365,350

44%

670,959

1,143,974

70%

Investment Income

24,203

22,995

(5)%

68,784

103,420

50%

Interest, Dividend and Other Revenue

25,749

(183)

n/m

45,822

(2,824)

n/m

Total Revenues

460,966

590,261

28%

1,345,631

2,009,005

49%

Compensation

72,916

92,229

26%

309,968

362,674

17%

Performance Fee Compensation

116,659

154,580

33%

274,819

475,639

73%

Interest Expense

12,987

19,170

48%

49,126

51,129

4%

Other Operating Expenses

34,771

32,478

(7)%

130,685

120,997

(7)%

Total Expenses

237,333

298,457

26%

764,598

1,010,439

32%

Economic Income

223,633

$         

291,804

$         

30%

581,033

$         

998,566

$         

72%

Total AUM

100,189,994

$ 

105,560,576

$ 

5%

100,189,994

$ 

105,560,576

$ 

5%

Fee-Earning AUM

69,110,457

$   

70,140,883

$   

1%

69,110,457

$   

70,140,883

$   

1%

Blackstone

5

Real Estate

19.4%

FY’17 Increase in Opportunistic

Funds’ Carrying Value

$115.3 billion

Total AUM up 13% YoY

$10.2 billion

4Q’17 Realizations

Scale

and

reach

of

global

platform

resulted

in

a

record

$24.5

billion

of

realizations,

record

$19.9

billion

capital

deployed

and

$23.8

billion

of

Total

AUM

inflows

in

2017.

Opportunistic

funds’

carrying

value

increased

5.2%

during

the

quarter

and

19.4%

for

the

full

year;

core+

funds’

carrying

value

increased

3.3%

in

the

quarter

and

12.0%

for

the

year.

Quarterly

realizations

of

$10.2

billion

driven

by

the

sale

of

Logicor,

the

largest

private

exit

in

BREP’s

history.

Invested

$11.0

billion

in

the

quarter,

including

two

public-to-private

transactions

in

Asia.

•

$4.4

billion

of

transactions

committed

but

not

yet

deployed

during

the

year

and

an

additional

$1.7

billion

committed

in

January,

including

the

privatization

of

a

Canadian

industrial

REIT.

Total

AUM

up

13%

and

Fee-Earning

AUM

up

17%

year-over-year

to

$115.3

billion

and

$84.0

billion,

respectively.

•

Total

AUM

inflows

of

$10.9

billion

during

the

quarter

driven

by

Europe

core+,

including

$6.0

billion

Logicor

asset

management

mandate

and

$2.0

billion

in

Total

AUM

from

the

initial

closing

for

BPP

Europe.

•

Global

core+

Total

AUM

up

91%

year-over-year

to

$27.0

billion,

four

years

after

launching

the

business.

Carrying value for core+ funds excludes BREIT.

% Change

% Change

(Dollars in Thousands)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Management Fees, Net

219,183

$         

244,064

$         

11%

883,163

$         

939,038

$         

6%

Performance Fees

358,319

479,363

34%

1,121,639

2,074,967

85%

Investment Income

59,749

24,747

(59)%

121,593

133,683

10%

Interest, Dividend and Other Revenue

27,615

3,834

(86)%

54,976

6,659

(88)%

Total Revenues

664,866

752,008

13%

2,181,371

3,154,347

45%

Compensation

82,000

108,490

32%

385,352

427,211

11%

Performance Fee Compensation

136,304

195,383

43%

406,354

802,861

98%

Interest Expense

13,138

26,891

105%

49,849

71,341

43%

Other Operating Expenses

37,956

38,543

2%

137,581

136,042

(1)%

Total Expenses

269,398

369,307

37%

979,136

1,437,455

47%

Economic Income

395,468

$         

382,701

$         

(3)%

1,202,235

$     

1,716,892

$     

43%

Total AUM

101,963,652

$ 

115,340,363

$ 

13%

101,963,652

$ 

115,340,363

$ 

13%

Fee-Earning AUM

72,030,054

$   

83,984,824

$   

17%

72,030,054

$   

83,984,824

$   

17%

Blackstone

6

Hedge Fund Solutions

8.3%

FY’17 BPS Composite Gross Return

$4.1

billion

4Q’17 Total AUM Inflows

$75.1

billion

Total AUM up 6% YoY

The

BPS

Composite

gross

return

was

1.5%

in

the

quarter

(1.3%

net),

and

8.3%

for

the

full

year

(7.3%

net),

continuing

positive

momentum

in

returns

for

hedge

fund

strategies.

Record

full

year

Total

Segment

Revenues

of

$728

million,

up

22%

year-over-year.

Total

AUM

inflows

of

$4.1

billion

during

the

quarter

and

$12.1

billion

for

the

year,

driven

by

customized

solutions,

commingled

products

and

individual

investor

and

specialized

solutions.

•

January

1

subscriptions

of

$1.3

billion

are

not

yet

included

in

Total

AUM.

Total

AUM

increased

6%

year-over-year

to

a

record

$75.1

billion,

driven

primarily

by

appreciation

across

strategies.

•

Total

AUM

for

BAAM’s

individual

investor

solutions

platform

reached

$8.3

billion,

up

20%

from

$6.9

billion

year-over-year.

•

Fee-Earning

AUM

up

4%

year-over-year

to

$69.9

billion.

The BPS Composite gross and net returns are based on the BAAM Principal Solutions (“BPS”) Composite, which does not include BAAM's individual investor solutions (liquid alternatives), long-biased commodities, ventures (seeding and

minority interests), strategic opportunities (co-invests), and advisory (non-discretionary) platforms, except for investments by BPS funds directly into those platforms. BAAM-managed funds in

liquidation and non fee-paying assets (net

returns only) are also excluded. The funds/accounts that comprise the BPS Composite are not managed within a single fund or account and are managed with different

mandates. There is no guarantee that BAAM would have made the same

mix of investments in a stand-alone fund/account. The BPS Composite is not an investible product and, as such, the performance of the Composite does not represent the performance of an actual fund or account.

% Change

% Change

(Dollars in Thousands)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Management Fees, Net

131,557

$         

130,384

$         

(1)%

522,797

$         

518,935

$         

(1)%

Performance Fees

25,573

29,525

15%

43,466

162,114

273%

Investment Income

5,424

6,583

21%

8,238

50,086

508%

Interest, Dividend and Other Revenue

13,876

1,347

(90)%

22,021

(2,855)

n/m

Total Revenues

176,430

167,839

(5)%

596,522

728,280

22%

Compensation

39,509

37,470

(5)%

185,320

176,782

(5)%

Performance Fee Compensation

9,665

2,436

(75)%

19,870

56,245

183%

Interest Expense

6,481

11,624

79%

24,524

31,618

29%

Other Operating Expenses

19,039

17,610

(8)%

75,870

68,265

(10)%

Total Expenses

74,694

69,140

(7)%

305,584

332,910

9%

Economic Income

101,736

$         

98,699

$           

(3)%

290,938

$         

395,370

$         

36%

Total AUM

71,119,718

$   

75,090,834

$   

6%

71,119,718

$   

75,090,834

$   

6%

Fee-Earning AUM

66,987,553

$   

69,914,061

$   

4%

66,987,553

$   

69,914,061

$   

4%

Blackstone

7

Credit

$9.7 billion

FY’17 Total Capital Deployed

$138.1

billion

Total AUM up 48% YoY

FY’17 Composite

Gross Returns

Performing Credit

11.2%

Distressed

7.7%

Composite

gross

returns

of

11.2%

for

Performing

Credit

and

7.7%

for

Distressed

Strategies

for

the

year.

•

Composite

gross

returns

for

the

quarter

were

1.7%

for

Performing

Credit

and

3.4%

for

Distressed

Strategies.

Investment

pace

remained

strong

with

a

record

$3.2

billion

of

capital

deployed

during

the

quarter

and

a

record

$9.7

billion

over

the

full

year.

Total

AUM

increased

48%

year-over-year

to

a

record

$138.1

billion,

driven

by

inflows

from

the

new

Blackstone

Insurance

Solutions

platform

primarily

comprised

of

Fidelity

&

Guaranty

Life,

and

the

acquisition

of

Harvest.

•

Blackstone

Insurance

Solutions

comprises

$22.5

billion

of

Total

AUM.

•

Closed

the

acquisition

of

Harvest,

contributing

$10.8

billion

to

Total

AUM.

•

Raised

$649

million

of

capital

in

the

quarter

for

the

successor

flagship

distressed

fund,

ending

the

year

with

a

total

of

$6.7

billion

of

capital

raised.

•

Launched

nine

CLOs

(six

U.S.

and

three

European)

for

the

year

totaling

$5.8

billion,

including

$2.1

billion

in

the

fourth

quarter.

% Change

% Change

(Dollars in Thousands)

4Q'16

4Q'17

vs. 4Q'16

FY'16

FY'17

vs. FY'16

Management Fees, Net

127,685

$         

155,845

$         

22%

496,967

$         

548,383

$         

10%

Performance Fees

104,464

118,520

13%

341,922

327,069

(4)%

Investment Income

9,906

1,412

(86)%

21,675

17,799

(18)%

Interest, Dividend and Other Revenue

14,143

2,687

(81)%

28,292

1,889

(93)%

Total Revenues

256,198

278,464

9%

888,856

895,140

1%

Compensation

46,638

67,845

45%

202,576

236,449

17%

Performance Fee Compensation

51,181

55,465

8%

166,979

153,585

(8)%

Interest Expense

6,480

14,660

126%

24,523

38,750

58%

Other Operating Expenses

27,876

27,318

(2)%

87,700

99,562

14%

Total Expenses

132,175

165,288

25%

481,778

528,346

10%

Economic Income

124,023

$         

113,176

$         

(9)%

407,078

$         

366,794

$         

(10)%

Total AUM

93,280,101

$   

138,136,470

$ 

48%

93,280,101

$   

138,136,470

$ 

48%

Fee-Earning AUM

68,964,608

$   

111,304,230

$ 

61%

68,964,608

$   

111,304,230

$ 

61%

Performing Credit Strategies include mezzanine lending funds, Business Development Companies (“BDCs”) and other performing credit strategy funds. Distressed Strategies include credit alpha strategies, stressed / distressed funds and distressed

energy strategies. The composite gross returns represent a weighted-average composite of the fee-earning funds exceeding $100 million of fair value at each respective quarter end for each strategy. Composite gross returns exclude the Blackstone

Funds that were contributed to GSO as part of Blackstone’s acquisition of GSO in March 2008. Performing Credit Strategies’ net composite returns were 0.3% and 6.2% for 4Q’17 and FY'17. Distressed Strategies’ net composite returns were 2.6%

and 4.9% for 4Q’17 and FY'17. The breakdown of Total AUM for 4Q’17 is as follows: Distressed Strategies $26.6 billion (23% Incentive Fee, 77% Carried Interest), Performing Credit Strategies $40.0 billion (47% Incentive Fee, 53% Carried Interest),

Long Only $38.2 billion, Blackstone Insurance Solutions $22.5 billion, and Harvest $10.8 billion. The breakdown of Fee-Earning AUM for 4Q’17 is as follows: Distressed Strategies $12.9 billion (43% Incentive Fee, 57% Carried Interest), Performing

Credit Strategies $27.5 billion (68% Incentive Fee, 32% Carried Interest), Long Only $37.6 billion, Blackstone Insurance Solutions $22.5 billion, and Harvest $10.8 billion.

Blackstone

8

$79.1

$93.3

$138.1

$69.1

$71.1

$75.1

$93.9

$102.0

$115.3

$94.3

$100.2

$105.6

$336.4

$366.6

$434.1

4Q'15

4Q'16

4Q'17

$61.7

$69.0

$111.3

$65.7

$67.0

$69.9

$67.3

$72.0

$84.0

$51.5

$69.1

$70.1

$246.1

$277.1

$335.3

4Q'15

4Q'16

4Q'17

Fee-Earning AUM by Segment

(Dollars in Billions)

Total AUM by Segment

(Dollars in Billions)

Assets Under Management

Total AUM increased 18% year-over-year to $434.1 billion driven by $108.0 billion of inflows.

•

Total AUM increased despite realizations of $55.2 billion during the year.

Fee-Earning AUM of $335.3 billion up 21% year-over-year as $97.2 billion of inflows outpaced $49.1 billion of

realizations and outflows.

Private Equity

Real Estate

Hedge Fund Solutions

Credit

Blackstone

9

$176.1

$26.8

$98.1

$301.0

Additional Capital Detail

Uninvested

Not Currently

Earning

Performance

Fees

Currently

Earning

Performance

Fees

Private Equity

Real Estate

Hedge Fund Solutions

Credit

$95 billion 4Q’17

Total Dry Powder

$301

billion Performance

Fee Eligible AUM

$46 billion Not Currently

Earning Management Fees

$30.4

$37.3

$64.4

$43.9

$176.1

Performance Fee Eligible AUM Currently Earning Performance Fees of $176.1 billion includes $43.9 billion for Private Equity (Corporate Private Equity $26.2 billion, Tactical

Opportunities $11.6 billion, Strategic Partners $6.1 billion), $64.4 billion for Real Estate (BREP $42.1 billion, core+ and BREIT $14.7 billion, BREDS $7.6 billion), $37.3 billion for

Hedge Funds Solutions, and $30.4

billion for Credit (Distressed Strategies $9.6 billion, Performing Credit Strategies $20.2 billion, Long Only and Master Limited Partnership

(“MLP”) $655 million).

Undrawn

capital

(“Total

Dry

Powder”)

was

$94.8

billion,

despite

$50.7

billion

of

capital

deployed

in

the

year.

•

79%

of

Total

Dry

Powder

was

raised

since

the

beginning

of

2015.

Performance

Fee

Eligible

AUM

reached

$301.0

billion

at

quarter

end,

up

11%

year-over-year,

despite

significant

realizations

in

the

Real

Estate

and

Private

Equity

segments.

$17.4

$2.5

$12.7

$13.1

$45.8

Private Equity

Real Estate

Hedge Fund

Solutions

Credit

$36.3

$3.9

$22.3

$32.3

Blackstone

10

At

December

31,

2017,

Blackstone

had

$5.1

billion

in

total

cash,

cash

equivalents,

and

corporate

treasury

investments

and

$10.4

billion

of

cash

and

net

investments,

or

$8.68

per

unit.

Blackstone

has

no

net

debt,

a

$1.5

billion

undrawn

credit

revolver

and

maintains

A+/A+

ratings.

•

In

October,

Blackstone

issued

$300

million

of

30-year

notes

at

a

4.00%

coupon

and

$300

million

of

10-year

notes

at

a

3.15%

coupon,

with

proceeds

being

used

to

repurchase

all

of

the

outstanding

2019

notes.

Deconsolidated Balance Sheet Highlights

Balance Sheet Highlights are preliminary, and exclude the consolidated Blackstone Funds. GP/Fund Investments include Blackstone investments in Private Equity, Real Estate, Hedge Fund Solutions,

and Credit, which were $607 million, $893 million, $79 million, and $367 million, respectively, as of December 31, 2017. Cash and Net Investments per unit amounts are calculated using period end DE

Units Outstanding (see page 32, Unit Rollforward).

A+/A+

Rated by S&P and Fitch

$1.5 billion

Undrawn Credit Revolver

with August 2021 Maturity

$5.1

billion

Total Cash and

Corporate Treasury

Cash and Net Investments

(Per Unit)

(Dollars in Millions)

4Q’17

Cash and Cash Equivalents

$

1,992

Corporate Treasury

Investments

3,113

GP/Fund Investments

1,945

Net Accrued Performance

Fees

3,354

Cash

and Net Investments

$

10,404

Outstanding

Bonds (at par)

$

3,580

$8.01

$8.61

$8.68

4Q'15

4Q'16

4Q'17

Blackstone

11

$2,186

$1,986

$1,846

$931

$1,268

$1,130

$3,251

$3,470

$3,354

4Q'15

4Q'16

4Q'17

$1,159

$888

$1,432

$1,218

$134

$753

$2,527

$1,119

$2,444

2015

2016

2017

Performance Fees

Net Realized Performance Fees

(Dollars in Millions)

Net Accrued Performance Fees

(Dollars in Millions)

Private Equity

Real Estate

Credit

Hedge Fund Solutions

$3.4

billion

Net Accrued Performance Fees

at 4Q’17

$2.80

per unit

Net Accrued Performance Fees

at 4Q’17

Net Accrued Performance Fees per unit is calculated using period end DE Units Outstanding (see page 32, Unit Rollforward).

Net

Accrued

Performance

Fees

were

$3.4

billion

($2.80/unit),

stable

over

the

last

twelve

months

with

strong

appreciation

generating

$2.2

billion

of

additional

Net

Accrued

Performance

Fees

that

offset

$2.4

billion

of

Net

Realized

Performance

Fees.

Appendix

Blackstone

13

Total Segments

Effective 4Q’17, Total Segment measures have been redefined to eliminate inter-segment interest revenue and expense. This adjustment results in no change to Economic Income, ENI, DE and FRE

on a Total Segment basis, but results in changes to each segment’s Economic Income. All historical results since its inception in 1Q’14 have been recast. Please see page 33 for Blackstone’s

Definitions of these measures. Effective 4Q’17, an insurance related multi-asset product in our Private Equity segment was reclassified to our Credit segment. All historical results since its inception in

3Q’16 have been recast. Please see Blackstone’s 4Q’17 Supplemental Financial Data available at ir.blackstone.com for additional historical periods.

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Revenues

Management and Advisory Fees, Net

Base Management Fees

623,571

$              

642,958

$              

671,368

$              

669,902

$              

696,163

$              

2,397,779

$           

2,680,391

$           

Transaction, Advisory and Other Fees, Net

35,618

40,222

38,892

32,295

45,407

144,858

156,816

Management Fee Offsets

(23,297)

(33,599)

(13,424)

(10,215)

(9,178)

(79,644)

(66,416)

Total Management and Advisory Fees, Net

635,892

649,581

696,836

691,982

732,392

2,462,993

2,770,791

Performance Fees

Realized Carried Interest

416,250

1,111,322

602,293

369,309

1,357,029

1,474,915

3,439,953

Realized Incentive Fees

83,993

47,137

41,106

101,198

187,858

172,101

377,299

Unrealized Carried Interest

239,210

(154,747)

65,080

432,597

(443,581)

481,241

(100,651)

Unrealized Incentive Fees

2,450

60,016

48,527

(8,472)

(108,548)

49,729

(8,477)

Total Performance Fees

741,903

1,063,728

757,006

894,632

992,758

2,177,986

3,708,124

Investment Income (Loss)

Realized

95,666

202,894

100,887

60,188

72,225

199,869

436,194

Unrealized

3,616

(98,935)

(33,167)

17,384

(16,488)

20,421

(131,206)

Total Investment Income

99,282

103,959

67,720

77,572

55,737

220,290

304,988

Interest Income and Dividend Revenue

28,544

28,496

33,703

37,885

42,836

96,399

142,920

Other

52,839

(8,287)

(62,469)

(34,144)

(35,151)

54,712

(140,051)

Total Revenues

1,558,460

1,837,477

1,492,796

1,667,927

1,788,572

5,012,380

6,786,772

Expenses

Compensation

241,063

289,027

305,257

302,798

306,034

1,083,216

1,203,116

Performance Fee Compensation

Realized Carried Interest

141,443

366,191

195,289

134,014

531,067

455,954

1,226,561

Realized Incentive Fees

33,286

22,752

21,481

46,823

69,627

78,096

160,683

Unrealized Carried Interest

137,591

(4,387)

74,500

187,158

(151,899)

312,838

105,372

Unrealized Incentive Fees

1,489

23,139

20,600

(7,094)

(40,931)

21,134

(4,286)

Total Compensation and Benefits

554,872

696,722

617,127

663,699

713,898

1,951,238

2,691,446

Interest Expense

39,086

39,450

40,294

40,749

72,345

148,022

192,838

Other Operating Expenses

119,642

96,462

105,838

106,617

115,949

431,836

424,866

Total Expenses

713,600

832,634

763,259

811,065

902,192

2,531,096

3,309,150

Economic Income

844,860

$              

1,004,843

$          

729,537

$              

856,862

$              

886,380

$              

2,481,284

$          

3,477,622

$          

Economic Net Income

811,610

$              

986,038

$              

705,369

$              

834,310

$              

850,374

$              

2,389,021

$          

3,376,091

$          

Fee Related Earnings

294,495

$              

290,742

$              

311,183

$              

306,708

$              

327,586

$              

1,021,688

$          

1,236,219

$          

Distributable Earnings

638,994

$              

1,230,138

$          

781,365

$              

625,566

$              

1,239,146

$          

2,121,575

$          

3,876,215

$          

Total Assets Under Management

366,553,465

$      

368,196,917

$      

371,056,281

$      

387,449,746

$      

434,128,243

$      

366,553,465

$      

434,128,243

$      

Fee-Earning Assets Under Management

277,092,672

$      

280,215,551

$      

281,934,511

$      

285,698,425

$      

335,343,998

$      

277,092,672

$      

335,343,998

$      

Weighted Average Fee-Earning AUM

274,475,842

$      

279,582,971

$      

281,966,547

$      

284,114,581

$      

311,353,064

$      

264,986,623

$      

289,116,993

$      

LP Capital Invested

7,974,603

$           

9,709,930

$           

7,799,624

$           

10,043,022

$        

18,663,837

$        

22,421,750

$        

46,216,413

$        

Total Capital Invested

8,221,697

$           

11,840,913

$        

8,382,583

$           

10,925,170

$        

19,529,797

$        

23,275,410

$        

50,678,463

$        

Blackstone

14

Private Equity

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Revenues

Management and Advisory Fees, Net

Base Management Fees

160,554

$            

176,706

$            

177,684

$            

182,764

$            

187,664

$            

555,593

$            

724,818

$            

Transaction, Advisory and Other Fees, Net

7,763

16,176

17,289

8,748

15,411

39,283

57,624

Management Fee Offsets

(10,850)

(12,190)

(3,753)

(1,088)

(976)

(34,810)

(18,007)

Total Management and Advisory Fees, Net

157,467

180,692

191,220

190,424

202,099

560,066

764,435

Performance Fees

Realized Carried Interest

131,532

582,681

198,168

101,918

274,421

245,268

1,157,188

Unrealized Carried Interest

122,015

(184,478)

9

80,326

90,929

425,691

(13,214)

Total Performance Fees

253,547

398,203

198,177

182,244

365,350

670,959

1,143,974

Investment Income (Loss)

Realized

50,339

81,294

41,168

7,077

25,298

73,377

154,837

Unrealized

(26,136)

(40,522)

(25,892)

17,300

(2,303)

(4,593)

(51,417)

Total Investment Income

24,203

40,772

15,276

24,377

22,995

68,784

103,420

Interest Income and Dividend Revenue

7,510

6,661

7,922

9,046

9,209

25,364

32,838

Other

18,239

(1,800)

(16,124)

(8,346)

(9,392)

20,458

(35,662)

Total Revenues

460,966

624,528

396,471

397,745

590,261

1,345,631

2,009,005

Expenses

Compensation

72,916

83,603

90,676

96,166

92,229

309,968

362,674

Performance Fee Compensation

Realized Carried Interest

50,768

181,633

63,060

48,019

111,832

110,882

404,544

Unrealized Carried Interest

65,891

(39,356)

22,219

45,484

42,748

163,937

71,095

Total Compensation and Benefits

189,575

225,880

175,955

189,669

246,809

584,787

838,313

Interest Expense

12,987

10,427

10,728

10,804

19,170

49,126

51,129

Other Operating Expenses

34,771

27,761

28,592

32,166

32,478

130,685

120,997

Total Expenses

237,333

264,068

215,275

232,639

298,457

764,598

1,010,439

Economic Income

223,633

$            

360,460

$            

181,196

$            

165,106

$            

291,804

$            

581,033

$            

998,566

$            

Total Assets Under Management

100,189,994

$    

99,707,057

$       

100,019,716

$    

102,453,979

$    

105,560,576

$    

100,189,994

$    

105,560,576

$    

Fee-Earning Assets Under Management

69,110,457

$       

68,227,286

$       

68,029,670

$       

67,538,062

$       

70,140,883

$       

69,110,457

$       

70,140,883

$       

Weighted Average Fee-Earning AUM

69,613,443

$       

68,613,668

$       

68,194,287

$       

67,606,365

$       

68,815,882

$       

66,103,146

$       

68,739,122

$       

LP Capital Invested

2,355,726

$         

4,736,388

$         

3,846,841

$         

3,725,919

$         

4,614,237

$         

7,443,607

$         

16,923,385

$       

Total Capital Invested

2,495,215

$         

6,748,859

$         

4,221,479

$         

4,279,062

$         

4,929,609

$         

7,911,511

$         

20,179,009

$       

Blackstone

15

Real Estate

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Revenues

Management Fees, Net

Base Management Fees

196,621

$            

197,879

$            

227,865

$            

224,048

$            

222,399

$            

795,161

$            

872,191

$            

Transaction and Other Fees, Net

24,228

21,279

16,087

20,616

24,799

95,324

82,781

Management Fee Offsets

(1,666)

(3,550)

(5,018)

(4,232)

(3,134)

(7,322)

(15,934)

Total Management Fees, Net

219,183

215,608

238,934

240,432

244,064

883,163

939,038

Performance Fees

Realized Carried Interest

274,495

519,841

389,004

261,122

954,505

1,203,484

2,124,472

Realized Incentive Fees

15,600

2,914

5,315

50,588

37,585

29,625

96,402

Unrealized Carried Interest

58,849

(22,268)

77,200

292,544

(493,952)

(150,997)

(146,476)

Unrealized Incentive Fees

9,375

18,713

22,608

(21,977)

(18,775)

39,527

569

Total Performance Fees

358,319

519,200

494,127

582,277

479,363

1,121,639

2,074,967

Investment Income (Loss)

Realized

43,104

119,579

57,599

44,449

34,276

122,712

255,903

Unrealized

16,645

(83,853)

(20,519)

(8,319)

(9,529)

(1,119)

(122,220)

Total Investment Income

59,749

35,726

37,080

36,130

24,747

121,593

133,683

Interest Income and Dividend Revenue

10,866

12,094

14,493

15,461

16,036

38,453

58,084

Other

16,749

(3,150)

(22,965)

(13,108)

(12,202)

16,523

(51,425)

Total Revenues

664,866

779,478

761,669

861,192

752,008

2,181,371

3,154,347

Expenses

Compensation

82,000

102,702

110,266

105,753

108,490

385,352

427,211

Performance Fee Compensation

Realized Carried Interest

85,686

179,925

124,292

84,192

354,602

332,622

743,011

Realized Incentive Fees

4,888

1,364

2,931

21,887

20,011

12,085

46,193

Unrealized Carried Interest

41,787

11,798

59,174

113,731

(171,015)

44,775

13,688

Unrealized Incentive Fees

3,943

8,509

9,680

(10,005)

(8,215)

16,872

(31)

Total Compensation and Benefits

218,304

304,298

306,343

315,558

303,873

791,706

1,230,072

Interest Expense

13,138

14,635

14,787

15,028

26,891

49,849

71,341

Other Operating Expenses

37,956

30,864

33,379

33,256

38,543

137,581

136,042

Total Expenses

269,398

349,797

354,509

363,842

369,307

979,136

1,437,455

Economic Income

395,468

$            

429,681

$            

407,160

$            

497,350

$            

382,701

$            

1,202,235

$         

1,716,892

$         

Total Assets Under Management

101,963,652

$    

102,070,930

$    

104,034,287

$    

111,298,844

$    

115,340,363

$    

101,963,652

$    

115,340,363

$    

Fee-Earning Assets Under Management

72,030,054

$       

71,904,741

$       

73,710,243

$       

75,081,521

$       

83,984,824

$       

72,030,054

$       

83,984,824

$       

Weighted Average Fee-Earning AUM

68,688,082

$       

72,268,792

$       

73,320,319

$       

74,340,895

$       

77,626,395

$       

67,503,830

$       

74,421,496

$       

LP Capital Invested

3,978,386

$         

2,590,419

$         

2,371,918

$         

3,778,790

$         

10,845,388

$       

10,969,746

$       

19,586,515

$       

Total Capital Invested

4,048,827

$         

2,651,965

$         

2,379,922

$         

3,841,972

$         

11,008,356

$       

11,176,257

$       

19,882,215

$       

Blackstone

16

Hedge Fund Solutions

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Revenues

Management Fees, Net

Base Management Fees

131,150

$            

128,468

$            

128,698

$            

129,410

$            

129,472

$            

521,736

$            

516,048

$            

Transaction and Other Fees, Net

407

259

1,696

48

977

1,061

2,980

Management Fee Offsets

-

-

-

(28)

(65)

-

(93)

Total Management Fees, Net

131,557

128,727

130,394

129,430

130,384

522,797

518,935

Performance Fees

Realized Incentive Fees

35,172

14,684

6,995

14,217

118,447

42,177

154,343

Unrealized Carried Interest

(245)

3,797

143

635

231

504

4,806

Unrealized Incentive Fees

(9,354)

40,311

22,458

29,349

(89,153)

785

2,965

Total Performance Fees

25,573

58,792

29,596

44,201

29,525

43,466

162,114

Investment Income (Loss)

Realized

(753)

(632)

225

1,316

8,165

(7,224)

9,074

Unrealized

6,177

18,293

11,578

12,723

(1,582)

15,462

41,012

Total Investment Income

5,424

17,661

11,803

14,039

6,583

8,238

50,086

Interest Income and Dividend Revenue

5,196

3,997

4,674

5,316

7,538

13,864

21,525

Other

8,680

(1,610)

(10,720)

(5,859)

(6,191)

8,157

(24,380)

Total Revenues

176,430

207,567

165,747

187,127

167,839

596,522

728,280

Expenses

Compensation

39,509

47,604

47,361

44,347

37,470

185,320

176,782

Performance Fee Compensation

Realized Incentive Fees

13,307

7,317

4,362

6,884

34,785

19,397

53,348

Unrealized Carried Interest

(92)

1,209

178

216

183

181

1,786

Unrealized Incentive Fees

(3,550)

14,004

9,242

10,397

(32,532)

292

1,111

Total Compensation and Benefits

49,174

70,134

61,143

61,844

39,906

205,190

233,027

Interest Expense

6,481

6,543

6,688

6,763

11,624

24,524

31,618

Other Operating Expenses

19,039

16,379

16,318

17,958

17,610

75,870

68,265

Total Expenses

74,694

93,056

84,149

86,565

69,140

305,584

332,910

Economic Income

101,736

$            

114,511

$            

81,598

$              

100,562

$            

98,699

$              

290,938

$            

395,370

$            

Total Assets Under Management

71,119,718

$       

73,303,381

$       

72,476,444

$       

74,219,563

$       

75,090,834

$       

71,119,718

$       

75,090,834

$       

Fee-Earning Assets Under Management

66,987,553

$       

68,812,528

$       

67,824,464

$       

69,037,961

$       

69,914,061

$       

66,987,553

$       

69,914,061

$       

Weighted Average Fee-Earning AUM

67,993,100

$       

68,406,531

$       

69,301,130

$       

68,957,501

$       

71,101,632

$       

66,585,721

$       

69,568,964

$       

LP Capital Invested

260,482

$            

121,857

$            

89,985

$              

360,748

$            

328,640

$            

753,548

$            

901,230

$            

Total Capital Invested

260,742

$            

121,888

$            

93,191

$              

363,420

$            

383,070

$            

774,443

$            

961,569

$            

Blackstone

17

Credit

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Revenues

Management Fees, Net

Base Management Fees

135,246

$            

139,905

$            

137,121

$            

133,680

$            

156,628

$            

525,289

$            

567,334

$            

Transaction and Other Fees, Net

3,220

2,508

3,820

2,883

4,220

9,190

13,431

Management Fee Offsets

(10,781)

(17,859)

(4,653)

(4,867)

(5,003)

(37,512)

(32,382)

Total Management Fees, Net

127,685

124,554

136,288

131,696

155,845

496,967

548,383

Performance Fees

Realized Carried Interest

10,223

8,800

15,121

6,269

128,103

26,163

158,293

Realized Incentive Fees

33,221

29,539

28,796

36,393

31,826

100,299

126,554

Unrealized Carried Interest

58,591

48,202

(12,272)

59,092

(40,789)

206,043

54,233

Unrealized Incentive Fees

2,429

992

3,461

(15,844)

(620)

9,417

(12,011)

Total Performance Fees

104,464

87,533

35,106

85,910

118,520

341,922

327,069

Investment Income (Loss)

Realized

2,976

2,653

1,895

7,346

4,486

11,004

16,380

Unrealized

6,930

7,147

1,666

(4,320)

(3,074)

10,671

1,419

Total Investment Income

9,906

9,800

3,561

3,026

1,412

21,675

17,799

Interest Income and Dividend Revenue

4,972

5,744

6,614

8,062

10,053

18,718

30,473

Other

9,171

(1,727)

(12,660)

(6,831)

(7,366)

9,574

(28,584)

Total Revenues

256,198

225,904

168,909

221,863

278,464

888,856

895,140

Expenses

Compensation

46,638

55,118

56,954

56,532

67,845

202,576

236,449

Performance Fee Compensation

Realized Carried Interest

4,989

4,633

7,937

1,803

64,633

12,450

79,006

Realized Incentive Fees

15,091

14,071

14,188

18,052

14,831

46,614

61,142

Unrealized Carried Interest

30,005

21,962

(7,071)

27,727

(23,815)

103,945

18,803

Unrealized Incentive Fees

1,096

626

1,678

(7,486)

(184)

3,970

(5,366)

Total Compensation and Benefits

97,819

96,410

73,686

96,628

123,310

369,555

390,034

Interest Expense

6,480

7,845

8,091

8,154

14,660

24,523

38,750

Other Operating Expenses

27,876

21,458

27,549

23,237

27,318

87,700

99,562

Total Expenses

132,175

125,713

109,326

128,019

165,288

481,778

528,346

Economic Income

124,023

$            

100,191

$            

59,583

$              

93,844

$              

113,176

$            

407,078

$            

366,794

$            

Total Assets Under Management

93,280,101

$       

93,115,549

$       

94,525,834

$       

99,477,360

$       

138,136,470

$    

93,280,101

$       

138,136,470

$    

Fee-Earning Assets Under Management

68,964,608

$       

71,270,996

$       

72,370,134

$       

74,040,881

$       

111,304,230

$    

68,964,608

$       

111,304,230

$    

Weighted Average Fee-Earning AUM

68,181,217

$       

70,293,980

$       

71,150,811

$       

73,209,820

$       

93,809,155

$       

64,793,926

$       

76,387,411

$       

LP Capital Invested

1,380,009

$         

2,261,266

$         

1,490,880

$         

2,177,565

$         

2,875,572

$         

3,254,849

$         

8,805,283

$         

Total Capital Invested

1,416,913

$         

2,318,201

$         

1,687,991

$         

2,440,716

$         

3,208,762

$         

3,413,199

$         

9,655,670

$         

Blackstone

18

Unitholder Distribution

A detailed

description

of

Blackstone’s

distribution

policy

and

the

definition

of

Distributable

Earnings

can

be

found

on

page

33,

Definitions

and

Distribution

Policy.

DE

before

Certain

Payables

represents

Distributable

Earnings before the deduction for the Payable Under Tax Receivable Agreement and tax expense (benefit) of wholly owned subsidiaries. Per Unit calculations are based on end of period Total Common Units Outstanding

(page 32, Unit Rollforward); actual distributions are paid to unitholders as of the applicable record date. Retained capital is withheld pro-rata from common and Blackstone Holdings Partnership unitholders. Common

unitholders’

share was $100 million for 4Q’17 and $313 million for FY’17.

Generated

$1.00

of

Distributable

Earnings

per

common

unit

during

the

quarter,

up

96%

from

the

prior

year,

bringing

the

full

year

amount

to

$3.17

per

common

unit.

Declared

a

quarterly

distribution

of

$0.85

per

common

unit

to

record

holders

as

of

February

12,

2018;

payable

on

February

20,

2018.

% Change

% Change

(Dollars in Thousands, Except per Unit Data)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

vs. 4Q'16

FY'16

FY'17

Distributable Earnings

638,994

$     

1,230,138

$ 

781,365

$     

625,566

$    

1,239,146

$   

94%

2,121,575

$ 

3,876,215

$    

83%

Add: Other Payables Attributable

to Common Unitholders

41,304

6,632

29,808

9,448

52,216

26%

82,318

98,104

19%

DE before Certain Payables

680,298

1,236,770

811,173

635,014

1,291,362

90%

2,203,893

3,974,319

80%

Percent to Common Unitholders

55%

55%

56%

56%

56%

55%

56%

DE before Certain Payables Attributable

to Common Unitholders

373,655

683,473

451,302

353,193

720,124

93%

1,202,108

2,208,092

84%

Less: Other Payables Attributable

to Common Unitholders

(41,304)

(6,632)

(29,808)

(9,448)

(52,216)

26%

(82,318)

(98,104)

19%

DE Attributable to Common Unitholders

332,351

676,841

421,494

343,745

667,908

101%

1,119,790

2,109,988

88%

DE per Common Unit

0.51

$           

1.02

$           

0.63

$           

0.52

$           

1.00

$             

96%

1.73

$           

3.17

$              

83%

Less: Retained Capital per Common Unit

(0.04)

$          

(0.15)

$          

(0.09)

$          

(0.08)

$          

(0.15)

$            

275%

(0.21)

$          

(0.47)

$             

124%

Actual Distribution per Common Unit

0.47

$           

0.87

$           

0.54

$           

0.44

$           

0.85

$             

81%

1.52

$           

2.70

$              

78%

Record Date

Feb 12, 2018

Payable Date

Feb 20, 2018

Blackstone

19

4Q’17 Total AUM Rollforward

(Dollars in Millions)

FY’17 Total AUM Rollforward

(Dollars in Millions)

Inflows include contributions, capital raised, other increases in available capital, purchases, multi-asset product allocations to other strategies and acquisitions. Outflows represent

redemptions, client withdrawals and other decreases in available capital. Realizations represent realizations from the disposition of assets. Market Activity represents gains (losses)

on

portfolio

investments

and

impact

of

foreign

exchange

rate

fluctuations.

In

the

Real

Estate

segment,

carrying

value

for

core+

funds

excludes

BREIT.

Total Assets Under Management

Private

Equity

Real

Estate

Hedge

Fund

Solutions

Credit

Inflows:

Logicor asset management mandate ($6.0 billion); BPP, including first close for BPP Europe ($2.4 billion); BREDS ($946 million);

second Asian opportunistic fund close ($841 million); BREIT ($463 million).

Realizations: BREP opportunistic funds and co-invest ($8.9 billion); BREDS ($917 million); core+ funds ($331 million).

Market Activity:

Carrying value increases of 5.2% and 3.3% within the opportunistic and core+ funds, respectively.

Inflows: Customized solutions ($2.2 billion); individual investor and specialized solutions ($1.5 billion); commingled products ($417 million).

Outflows and Realizations:

Individual investor and specialized solutions ($2.5 billion); commingled products ($1.3 billion); customized

solutions ($884 million).

Market Activity:

BAAM’s Principal Solutions Composite up 1.5% gross (1.3% net) during the quarter.

Inflows: Blackstone Insurance Solutions ($22.4 billion); Harvest acquisition ($11.2 billion); mezzanine funds ($2.4 billion); distressed

strategies ($2.2

billion); three new CLOs ($2.1 billion); long only and MLP ($1.6 billion); BDCs ($323 million).

Outflows and Realizations: Long only and MLP ($1.4 billion); distressed strategies ($936 million); capital returned to investors for CLOs

outside investment periods ($823

million); mezzanine funds ($710 million); dividends from BDCs ($551 million).

Inflows: Corporate Private Equity ($1.8 billion); Tactical Opportunities ($1.1 billion); Strategic Partners ($1.0 billion); multi-asset product

($667

million), BCP co-investments ($400 million).

Realizations: Corporate Private Equity ($2.0 billion); Tactical Opportunities ($1.5 billion); Strategic Partners ($832 million).

Market Activity:

Carrying value increase of 6.8% within Corporate Private Equity.

Private

Real

Hedge Fund

Equity

Estate

Solutions

3Q'17

102,454

$   

111,299

$   

74,220

$     

99,477

$     

387,450

$   

Inflows

5,028

10,880

4,084

42,236

62,228

Outflows

(565)

(120)

(3,115)

(2,059)

(5,859)

Realizations

(4,405)

(10,195)

(1,619)

(2,432)

(18,651)

Net Inflows (Outflows)

58

565

(650)

37,746

37,718

Market Activity

3,049

3,477

1,521

913

8,960

4Q'17

105,561

$   

115,340

$   

75,091

$     

138,136

$   

434,128

$   

QoQ Increase

3%

4%

1%

39%

12%

Credit

Total

Private

Real

Hedge Fund

Equity

Estate

Solutions

4Q'16

100,190

$   

101,964

$   

71,120

$     

93,280

$     

366,553

$   

Inflows

12,631

23,844

12,106

59,374

107,956

Outflows

(1,230)

(1,400)

(10,662)

(6,165)

(19,457)

Realizations

(15,761)

(24,528)

(2,410)

(12,488)

(55,186)

Net Inflows (Outflows)

(4,360)

(2,083)

(965)

40,721

33,312

Market Activity

9,731

15,460

4,936

4,136

34,262

4Q'17

105,561

$   

115,340

$   

75,091

$     

138,136

$   

434,128

$   

YoY Increase

5%

13%

6%

48%

18%

Credit

Total

Blackstone

20

4Q’17 Fee-Earning AUM Rollforward

(Dollars in Millions)

FY’17 Fee-Earning AUM Rollforward

(Dollars in Millions)

Private

Equity

Real

Estate

Hedge

Fund

Solutions

Credit

Inflows: Logicor asset management mandate ($5.9 billion); start of second Asia opportunistic fund investment period ($5.8 billion);

BPP

($1.9

billion); BREDS ($1.9 billion); BREIT ($463 million).

Realizations: BREP opportunistic funds and co-invest ($3.6 billion); BREDS ($1.5 billion); core+ funds ($300 million).

Outflows: Investment period ended for BREP Asia I ($2.1 billion).

Inflows: Customized solutions ($2.1 billion); individual investor and specialized solutions ($1.2 billion); commingled products ($405 million).

Outflows and Realizations:

Individual investor and specialized solutions ($2.4 billion); commingled products ($1.2 billion); customized

solutions ($765 million).

Inflows: Blackstone Insurance Solutions ($22.4 billion); Harvest acquisition ($11.2 billion); mezzanine funds ($2.7 billion); three new CLOs

($2.1 billion); long only and MLP ($1.4 billion); distressed strategies ($361 million); BDCs ($323 million).

Outflows and Realizations: Long only and MLP ($1.3 billion); distressed strategies ($634 million); dividends from BDCs ($551 million);

mezzanine funds ($495 million); capital returned to investors for CLOs outside investment periods ($373 million).

Inflows: Tactical Opportunities ($1.7 billion); Corporate Private Equity ($1.6 billion); Strategic Partners ($1.1 billion).

Realizations: Tactical Opportunities ($641 million); Strategic Partners ($627 million); Corporate Private Equity ($616 million).

Fee-Earning Assets Under Management

Private

Real

Hedge Fund

Equity

Estate

Solutions

4Q'16

69,110

$     

72,030

$     

66,988

$     

68,965

$     

277,093

$   

Inflows

8,257

23,556

10,302

55,100

97,216

Outflows

(1,197)

(2,773)

(9,777)

(4,365)

(18,112)

Realizations

(6,558)

(11,852)

(2,182)

(10,396)

(30,989)

Net Inflows (Outflows)

503

8,931

(1,657)

40,339

48,115

Market Activity

528

3,024

4,583

         ��

2,001

10,136

4Q'17

70,141

$     

83,985

$     

69,914

$     

111,304

$   

335,344

$   

YoY Increase

1%

17%

4%

61%

21%

Credit

Total

Inflows include contributions, capital raised, other increases in available capital, purchases, multi-asset product allocations to other strategies and acquisitions. Outflows represent

redemptions, client withdrawals and other decreases in available capital. Realizations represent realizations from the disposition of assets. Market Activity represents gains (losses)

on portfolio investments and impact of foreign exchange rate fluctuations.

Private

Real

Hedge Fund

Equity

Estate

Solutions

3Q'17

67,538

$    

75,082

$    

69,038

$    

74,041

$    

285,698

$  

Inflows

4,349

16,015

3,751

40,396

64,511

Outflows

(2,268)

(2,848)

(1,819)

(6,935)

Realizations

(1,884)

(5,443)

(1,479)

(1,611)

(10,418)

Net Inflows (Outflows)

2,465

8,304

(577)

36,966

47,158

Market Activity

138

599

1,453

297

2,488

4Q'17

70,141

$    

83,985

$    

69,914

$    

111,304

$  

335,344

$  

QoQ Increase

4%

12%

1%

50%

17%

Credit

Total

-

Blackstone

21

Net Accrued Performance Fees

$3.4

billion

Net Accrued Performance Fees at 4Q’17

$2.80

per unit

Net Accrued Performance Fees at 4Q’17

$585 million

Increase to Receivable from Net Performance

Fee Income in 4Q’17

$841 million

Decrease to Receivable from Net Realized

Distributions in 4Q’17

Net Accrued Performance Fees are presented net of performance fee compensation and do not include clawback amounts, if any, which are disclosed in the 10-K/Q. Net Realized

Performance Fees are included in DE. Net Realized Performance Fees represents Performance Fees realized, but not yet distributed as of the reporting date and included in the Net

Accrued Performance Fee balance. When these fees are received, the receivable is reduced without further impacting DE. Per Unit calculations are based on end of period DE Units

Outstanding (see page 32, Unit Rollforward).

Net Accrued Performance Fees

(Dollars in Millions, Except per Unit Data)

3Q'17

4Q'17

4Q'17 Per Unit

QoQ Change

BCP IV Carried Interest

96

$                             

87

$                             

0.07

$                          

(9)

$                              

BCP V Carried Interest

75

73

0.06

(2)

BCP VI Carried Interest

618

668

0.56

50

BCP VII Carried Interest

-

16

0.01

16

BEP I Carried Interest

77

95

0.08

18

BEP II Carried Interest

14

5

-

(9)

Tactical Opportunities Carried Interest

119

104

0.09

(15)

Strategic Partners Carried Interest

56

66

0.06

10

BTAS Carried Interest

15

13

0.01

(2)

Other Carried Interest

2

3

-

1

Total Private Equity

1,072

$                       

1,130

$                        

0.94

$                          

58

$                             

8

9

0.01

1

BREP V Carried Interest

241

203

0.17

(38)

BREP VI Carried Interest

247

190

0.16

(57)

BREP VII Carried Interest

611

587

0.49

(24)

BREP VIII Carried Interest

236

255

0.21

19

BREP Europe III Carried Interest

182

67

0.06

(115)

BREP Europe IV Carried Interest

396

207

0.17

(189)

BREP Europe V Carried Interest

9

25

0.02

16

BREP Asia Carried Interest

84

102

0.09

18

BPP Carried Interest

86

100

0.08

14

BPP Incentive Fees

56

34

0.03

(22)

BREIT Incentive Fees

6

10

0.01

4

BREDS Carried Interest

20

22

0.02

2

BREDS Incentive Fees

12

13

0.01

1

Asia Platform Incentive Fees

9

6

0.01

(3)

BTAS Carried Interest

19

16

0.01

(3)

Total Real Estate

2,222

$                       

1,846

$                        

1.55

$                          

(376)

$                          

Carried Interest

5

5

-

-

Incentive Fees

69

84

0.07

15

Total Hedge Fund Solutions

74

$                             

89

$                             

0.07

$                          

15

$                             

224

268

0.22

44

Incentive Fees

18

21

0.02

3

Total Credit

242

$                           

289

$                           

0.24

$                          

47

$                             

3,440

3,186

2.66

(254)

Incentive Fees

170

168

0.14

(2)

Net Accrued Performance Fees

3,610

$                       

3,354

$                        

2.80

$                          

(256)

$                          

Memo: Net Realized Performance Fees

129

$                          

222

$                          

0.19

$                         

93

$                             

Real Estate

BREP IV Carried Interest

Private Equity

Credit

Carried Interest

Total Blackstone

Carried Interest

Hedge Fund Solutions

Blackstone

22

Investment

Records

as

of

December

31,

2017

(a)

Continued...

(Dollars in Thousands, Except Where Noted)

Committed

Available

Unrealized Investments

Realized Investments

Total Investments

Net IRRs (d)

Fund (Investment Period Beginning Date / Ending Date)

Capital

Capital (b)

Value

MOIC (c)

% Public

Value

MOIC (c)

Value

MOIC (c)

Realized

Total

Private Equity

BCP I (Oct 1987 / Oct 1993)

859,081

$           

-

$                    

-

$                    

n/a

-

1,741,738

$        

2.6x

1,741,738

$        

2.6x

19%

19%

BCP II (Oct 1993 / Aug 1997)

1,361,100

-

-

n/a

-

3,256,819

2.5x

3,256,819

2.5x

32%

32%

BCP III (Aug 1997 / Nov 2002)

3,967,422

-

-

n/a

-

9,184,688

2.3x

9,184,688

2.3x

14%

14%

BCOM (Jun 2000 / Jun 2006)

2,137,330

24,575

19,313

1.5x

-

2,953,649

1.4x

2,972,962

1.4x

7%

6%

BCP IV (Nov 2002 / Dec 2005)

6,773,182

209,846

756,129

0.8x

48%

20,677,725

3.2x

21,433,854

2.8x

42%

36%

BCP V (Dec 2005 / Jan 2011)

21,024,739

1,055,337

2,413,319

1.1x

43%

35,757,252

2.0x

38,170,571

1.9x

9%

8%

BCP VI (Jan 2011 / May 2016)

15,199,202

1,857,593

15,493,831

1.6x

20%

8,470,999

2.0x

23,964,830

1.7x

23%

13%

BEP I (Aug 2011 / Feb 2015)

2,437,639

157,170

2,558,266

1.5x

31%

1,323,850

2.0x

3,882,116

1.6x

32%

13%

BEP II (Feb 2015 / Feb 2021)

4,882,737

1,926,610

2,487,414

1.2x

-

47,388

2.1x

2,534,802

1.2x

     n/m

10%

BCP VII (May 2016 / May 2022)

18,507,997

13,697,870

4,147,133

1.2x

-

267,852

1.1x

4,414,985

1.2x

     n/m

9%

BCP Asia (Dec 2017 /Dec 2023)

1,576,564

1,423,640

-

n/a

-

-

n/a

-

n/a

n/a

n/a

Total Corporate Private Equity

78,726,993

$     

20,352,641

$     

27,875,405

$     

1.4x

19%

83,681,960

$     

2.2x

111,557,365

$   

1.9x

17%

15%

Tactical Opportunities

16,565,845

6,853,971

9,534,468

1.2x

8%

4,458,750

1.7x

13,993,218

1.3x

25%

11%

Tactical Opportunities Co-Investment and Other

4,822,889

2,379,805

3,452,342

1.1x

-

885,924

1.7x

4,338,266

1.2x

n/a

13%

Strategic Partners I-V and Co-Investment (e)

11,862,658

1,718,537

2,300,197

     n/m

-

15,147,965

     n/m

17,448,162

1.5x

n/a

13%

Strategic Partners VI LBO, RE and SMA (e)

7,402,171

2,571,351

3,170,940

     n/m

-

2,320,522

     n/m

5,491,462

1.4x

n/a

20%

Strategic Partners VII (e)

7,489,970

3,780,343

3,103,959

     n/m

-

237,950

     n/m

3,341,909

1.2x

n/a

73%

Strategic Partners RA II (e)

1,491,009

1,167,065

221,364

     n/m

-

5,582

     n/m

226,946

1.0x

n/a

     n/m

BCEP (Jan 2017 / Jan 2021) (f)

4,755,133

3,377,340

1,374,222

1.0x

-

-

n/a

1,374,222

1.0x

     n/m

     n/m

Other Funds and Co-Investment (g)

1,096,679

513

42,895

0.8x

36%

637,938

0.9x

680,833

0.9x

n/a

n/a

Real Estate

Pre-BREP

140,714

$           

-

$                    

-

$                    

n/a

-

345,190

$           

2.5x

345,190

$           

2.5x

33%

33%

BREP I (Sep 1994 / Oct 1996)

380,708

-

-

n/a

-

1,327,708

2.8x

1,327,708

2.8x

40%

40%

BREP II (Oct 1996 / Mar 1999)

1,198,339

-

-

n/a

-

2,531,614

2.1x

2,531,614

2.1x

19%

19%

BREP III (Apr 1999 / Apr 2003)

1,522,708

-

-

n/a

-

3,330,406

2.4x

3,330,406

2.4x

21%

21%

BREP IV (Apr 2003 / Dec 2005)

2,198,694

-

353,666

0.4x

38%

4,193,163

2.2x

4,546,829

1.7x

35%

12%

BREP V (Dec 2005 / Feb 2007)

5,539,418

-

1,753,688

2.0x

29%

11,558,245

2.4x

13,311,933

2.3x

13%

11%

BREP VI (Feb 2007 / Aug 2011)

11,060,444

556,763

2,073,204

2.0x

23%

25,369,422

2.6x

27,442,626

2.5x

14%

13%

BREP VII (Aug 2011 / Apr 2015)

13,495,014

2,063,092

12,489,255

1.6x

21%

15,571,767

2.1x

28,061,022

1.9x

30%

18%

BREP VIII (Apr 2015 / Oct 2020)

16,435,028

9,361,391

9,519,459

1.3x

1%

3,320,192

1.5x

12,839,651

1.4x

34%

18%

Total Global BREP

51,971,067

$     

11,981,246

$     

26,189,272

$     

1.5x

15%

67,547,707

$     

2.3x

93,736,979

$     

2.0x

20%

16%

BREP Int'l (Jan 2001 / Sep 2005)

824,172

€           

-

€                    

-

€                     

n/a

-

1,369,016

€        

2.1x

1,369,016

€        

2.1x

23%

23%

BREP Int'l II (Sep 2005 / Jun 2008) (h)

1,629,748

-

196,692

0.7x

22%

2,215,612

2.0x

2,412,304

1.7x

10%

8%

BREP Europe III (Jun 2008 / Sep 2013)

3,205,167

459,102

1,412,710

1.5x

-

4,929,306

2.5x

6,342,016

2.2x

22%

16%

BREP Europe IV (Sep 2013 / Dec 2016)

6,707,671

1,444,315

5,083,569

1.5x

6%

5,483,833

2.0x

10,567,402

1.7x

28%

18%

BREP Europe V (Dec 2016 / Jun 2022)

7,809,546

5,455,395

2,446,991

1.2x

-

-

n/a

2,446,991

1.2x

n/a

21%

Total Euro BREP

20,176,304

€      

7,358,812

€        

9,139,962

€        

1.3x

4%

13,997,767

€      

2.1x

23,137,729

€      

1.7x

18%

14%

BREP Asia (Jun 2013 / Dec 2017)

5,094,145

$        

2,039,069

$        

4,058,820

$        

1.4x

-

2,354,105

$        

1.8x

6,412,925

$        

1.5x

24%

17%

BREP Asia II (Dec 2017 / Jun 2023)

5,872,995

5,872,995

-

n/a

-

-

n/a

-

n/a

n/a

n/a

BREP Co-Investment (i)

6,872,697

146,573

2,524,738

1.8x

58%

11,289,288

2.1x

13,814,026

2.1x

16%

16%

Total BREP

94,515,478

$     

28,874,136

$     

43,680,859

$     

1.5x

13%

99,227,773

$     

2.2x

142,908,632

$   

1.9x

19%

16%

BPP (j)

22,714,906

$      

3,385,428

$        

22,077,318

$      

1.1x

-

1,687,447

$        

3.1x

23,764,765

$      

1.2x

n/m

12%

BREDS (k)

13,256,252

$      

5,918,948

$        

2,877,439

$        

1.1x

-

8,470,740

$        

1.3x

11,348,179

$      

1.3x

12%

11%

Realized and Unrealized Investments amounts were adjusted in 4Q’17 to account for a change in methodology regarding the treatment of current income, which now recognizes all proceeds as

Realized Value.

Blackstone

23

(Dollars in Thousands, Except Where Noted)

Committed

Available

Unrealized Investments

Realized Investments

Total Investments

Net IRRs (d)

Fund (Investment Period Beginning Date / Ending Date)

Capital

Capital (b)

Value

MOIC (c)

% Public

Value

MOIC (c)

Value

MOIC (c)

Realized

Total

Hedge Fund Solutions

BSCH (Dec 2013 / Jun 2020) (l)

3,298,575

$        

2,598,501

$        

816,577

$           

1.0x

-

195,909

$           

n/a

1,012,486

$        

1.3x

n/a

6%

BSCH Co-Investment

276,000

193,020

109,490

1.0x

-

19,626

n/a

129,116

1.2x

n/a

16%

Total Hedge Fund Solutions

3,574,575

$        

2,791,521

$        

926,067

$           

1.0x

-

215,535

$           

n/a

1,141,602

$        

1.3x

n/a

6%

Credit (m)

Mezzanine I (Jul 2007 / Oct 2011)

2,000,000

$        

97,114

$             

57,318

$             

1.0x

-

4,767,097

$        

1.6x

4,824,415

$        

1.6x

n/a

17%

Mezzanine II (Nov 2011 / Nov 2016)

4,120,000

1,154,965

2,642,627

1.1x

-

3,735,972

1.5x

6,378,599

1.3x

n/a

13%

Mezzanine III (Sep 2016 / Sep 2021)

6,639,133

4,417,141

2,256,846

1.1x

-

482,139

1.4x

2,738,985

1.1x

n/a

14%

Stressed / Distressed Investing I (Sep 2009 / May 2013)

3,253,143

275,357

372,255

0.6x

-

5,541,335

1.5x

5,913,590

1.4x

n/a

11%

Stressed / Distressed Investing II (Jun 2013 / Jun 2018)

5,125,000

880,783

3,517,251

1.1x

-

2,045,005

1.5x

5,562,256

1.2x

n/a

14%

Stressed / Distressed Investing III (Dec 2017/ Dec 2022)

6,652,790

6,465,005

29,292

0.9x

-

-

n/a

29,292

0.9x

n/a

n/a

Energy Select Opportunities (Nov 2015 / Nov 2018)

2,856,867

1,308,588

1,640,289

1.1x

-

268,018

1.7x

1,908,307

1.2x

n/a

21%

Euro

European Senior Debt Fund (Feb 2015 / Feb 2018)

1,964,689

€        

1,882,793

€        

1,654,112

€        

1.0x

-

507,929

€           

1.5x

2,162,041

€        

1.1x

n/a

10%

Total Credit

32,913,343

$     

16,859,811

$     

12,502,136

$     

1.1x

-

17,413,704

$     

1.6x

29,915,840

$     

1.3x

n/a

14%

The returns presented herein represent those of the applicable Blackstone Funds and not those of The Blackstone Group L.P.

n/m

Not meaningful.

n/a

Not applicable.

(a)

Preliminary.

(b)

Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital and may

include leverage, less invested capital. This amount is not reduced by outstanding commitments to investments.

(c)

Multiple of Invested Capital (“MOIC”) represents carrying value, before management fees, expenses and Carried Interest, divided by invested capital.

(d)

unrealized value, as applicable, after management fees, expenses and Carried Interest.

(e)

Realizations are treated as return of capital until fully recovered and therefore unrealized and realized MOICs are not meaningful.

(f)

BCEP, or Blackstone Core Equity Partners, is a core private equity fund which invests with a more modest risk profile and longer hold period.

(g)

Returns for Other Funds and Co-Investment are not meaningful as these funds have limited transaction activity.

(h)

The 10% Realized Net IRR and 8% Total Net IRR exclude investors that opted out of the Hilton investment opportunity. Overall BREP International II performance

reflects a 8% Realized Net IRR and a 6% Total Net IRR.  Previous quarters’ Investment Records reflected the overall BREP International II performance.

(i)

BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-

investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Carried Interest.

(j)

BPP represents the core+ real estate funds which invest with a more modest risk profile and lower leverage. Excludes BREIT.

(k)

Excludes Capital Trust drawdown funds.

(l)

(m)

Funds presented represent the flagship credit drawdown funds only. The Total Credit Net IRR is the combined IRR of the eight credit drawdown funds presented.

Net Internal Rate of Return (“IRR”) represents the annualized inception to December 31, 2017 IRR on total invested capital based on realized proceeds and

Investment

Records

as

of

December

31,

2017

(a)

–

Continued

BSCH, or Blackstone Strategic Capital Holdings, is a permanent capital vehicle focused on acquiring strategic minority positions in alternative asset managers.

Blackstone

24

Notes on page 26.

Reconciliation of GAAP to Non-GAAP Measures –

Quarters

(Dollars in Thousands)

1Q'16

2Q'16

3Q'16

4Q'16

1Q'17

(o)

2Q'17

3Q'17

4Q'17

Net Income Attributable to The Blackstone Group L.P.

159,753

$     

198,626

$     

312,905

$     

367,951

$     

461,825

$     

342,775

$     

384,642

$     

281,588

$     

Net Income Attributable to Non-Controlling Interests in Blackstone Holdings

131,202

201,805

285,267

342,010

417,258

287,979

345,650

340,992

Net Income Attributable to Non-Controlling Interests in Consolidated Entities

40,086

64,729

82,653

58,684

138,685

112,944

113,446

132,364

Net Income Attributable to Redeemable Non-Controlling

Interests in Consolidated Entities

(6,401)

(2,049)

10,764

1,663

2,000

991

3,215

7,600

Net Income

324,640

$     

463,111

$     

691,589

$     

770,308

$     

1,019,768

$  

744,689

$     

846,953

$     

762,544

$     

Provision for Taxes

9,146

47,415

27,714

48,087

57,437

29,608

59,512

596,590

Income Before Provision for Taxes

333,786

$     

510,526

$     

719,303

$     

818,395

$     

1,077,205

$  

774,297

$     

906,465

$     

1,359,134

$  

Transaction-Related Charges

(a)

64,136

69,956

60,029

70,816

56,979

57,831

55,714

(347,055)

Amortization of Intangibles

(b)

23,208

23,208

22,054

15,996

11,344

11,344

11,344

14,265

(Income) Associated with Non-Controlling Interests of Consolidated Entities

(c)

(33,685)

(62,680)

(93,417)

(60,347)

(140,685)

(113,935)

(116,661)

(139,964)

Economic Income

387,445

$     

541,010

$     

707,969

$     

844,860

$     

1,004,843

$  

729,537

$     

856,862

$     

886,380

$     

(Taxes)

(d)

(16,794)

(21,234)

(20,985)

(33,250)

(18,805)

(24,168)

(22,552)

(36,006)

Economic Net Income

370,651

$     

519,776

$     

686,984

$     

811,610

$     

986,038

$     

705,369

$     

834,310

$     

850,374

$     

Taxes

(d)

16,794

21,234

20,985

33,250

18,805

24,168

22,552

36,006

Performance Fee Adjustment

(e)

(314,065)

(449,372)

(672,646)

(741,903)

(1,063,728)

(757,006)

(894,632)

(992,758)

Investment (Income) Adjustment

(f)

26,650

(59,771)

(87,887)

(99,282)

(103,959)

(67,720)

(77,572)

(55,737)

Other Revenue

(g)

6,248

(8,546)

425

(52,839)

8,287

62,469

34,144

35,151

Net Interest Loss

(h)

13,351

13,546

14,184

10,542

10,954

6,591

2,864

29,509

Performance Fee Compensation and Benefits Adjustment

(i)

106,075

180,723

267,415

313,809

407,695

311,870

360,901

407,864

Equity-Based Compensation -

Non-Incentive Fee Related

(j)

20,963

16,852

16,624

19,308

26,650

25,442

24,141

17,177

Fee Related Earnings

246,667

$     

234,442

$     

246,084

$     

294,495

$     

290,742

$     

311,183

$     

306,708

$     

327,586

$     

Net Realized Performance Fees

(k)

187,794

251,935

352,008

327,053

772,780

429,177

293,339

948,412

Realized Investment Income

(l)

(10,101)

53,670

60,634

95,666

202,894

100,887

60,188

72,225

Net Interest (Loss)

(h)

(13,351)

(13,546)

(14,184)

(10,542)

(10,954)

(6,591)

(2,864)

(29,509)

Taxes and Related Payables Including Payable Under Tax Receivable Agreement

(m)

(16,794)

(31,588)

(51,089)

(67,678)

(25,324)

(53,291)

(31,805)

(79,568)

Distributable Earnings

394,215

$     

494,913

$     

593,453

$     

638,994

$     

1,230,138

$  

781,365

$     

625,566

$     

1,239,146

$  

Interest Expense

(n)

36,497

36,020

36,419

39,086

39,450

40,294

40,749

72,345

Taxes and Related Payables Including Payable Under Tax Receivable Agreement

(m)

16,794

31,588

51,089

67,678

25,324

53,291

31,805

79,568

Depreciation and Amortization

6,292

6,331

7,338

12,010

6,216

6,392

6,027

6,593

Adjusted EBITDA

453,798

$     

568,852

$     

688,299

$     

757,768

$     

1,301,128

$  

881,342

$     

704,147

$     

1,397,652

$  

Blackstone

25

Notes on page 26.

Reconciliation

of

GAAP

to

Non-GAAP

Measures

–

Years

(Dollars in Thousands)

2013

2014

2015

2016

2017

(o)

Net Income Attributable to The Blackstone Group L.P.

1,171,202

$       

1,584,589

$       

709,789

$          

1,039,235

$       

1,470,830

$       

Net Income Attributable to Non-Controlling Interests in Blackstone Holdings

1,339,845

1,701,100

683,516

960,284

1,391,879

Net Income Attributable to Non-Controlling Interests in Consolidated Entities

198,557

335,070

219,900

246,152

497,439

Net Income Attributable to Redeemable Non-Controlling

Interests in Consolidated Entities

183,315

74,794

11,145

3,977

13,806

Net Income

2,892,919

$       

3,695,553

$       

1,624,350

$       

2,249,648

$       

3,373,954

$       

Provision for Taxes

255,642

291,173

190,398

132,362

743,147

Income Before Provision for Taxes

3,148,561

$       

3,986,726

$       

1,814,748

$       

2,382,010

$       

4,117,101

$       

Transaction-Related Charges

(a)

722,707

856,382

489,563

264,937

(176,531)

Amortization of Intangibles

(b)

106,643

111,254

104,530

84,466

48,297

(Income) Associated with Non-Controlling Interests of Consolidated Entities

(c)

(381,872)

(409,864)

(231,045)

(250,129)

(511,245)

Economic Income

3,596,039

$       

4,544,498

$       

2,177,796

$       

2,481,284

$       

3,477,622

$       

(Taxes)

(d)

(82,164)

(199,512)

(27,527)

(92,263)

(101,531)

Economic Net Income

3,513,875

$       

4,344,986

$       

2,150,269

$       

2,389,021

$       

3,376,091

$       

Taxes

(d)

82,164

199,512

27,527

92,263

101,531

Performance Fee Adjustment

(e)

(3,556,373)

(4,391,877)

(1,798,077)

(2,177,986)

(3,708,124)

Investment (Income) Adjustment

(f)

(687,805)

(471,628)

(52,849)

(220,290)

(304,988)

Other Revenue

(g)

(10,308)

(9,405)

(8,500)

(54,712)

140,051

Net Interest Loss

(h)

32,968

36,511

44,181

51,623

49,918

Performance Fee Compensation and Benefits Adjustment

(i)

1,413,182

1,285,503

564,560

868,022

1,488,330

Equity-Based Compensation -

Non-Incentive Fee Related

(j)

130,124

45,133

96,901

73,747

93,410

Fee Related Earnings

917,827

$          

1,038,735

$       

1,024,012

$       

1,021,688

$       

1,236,219

$       

Net Realized Performance Fees

(k)

960,175

1,789,692

2,527,019

1,118,790

2,443,708

Realized Investment Income

(l)

170,471

543,425

418,808

199,869

436,194

Net Interest (Loss)

(h)

(32,968)

(36,511)

(44,181)

(51,623)

(49,918)

Taxes and Related Payables Including Payable Under Tax Receivable Agreement

(m)

(156,734)

(280,788)

(90,470)

(167,149)

(189,988)

Distributable Earnings

1,858,771

$       

3,054,553

$       

3,835,188

$       

2,121,575

$       

3,876,215

$       

Interest Expense

(n)

103,904

112,563

139,842

148,022

192,838

Taxes and Related Payables Including Payable Under Tax Receivable Agreement

(m)

156,734

280,788

90,470

167,149

189,988

Depreciation and Amortization

35,441

32,300

27,213

31,971

25,228

Adjusted EBITDA

2,154,850

$       

3,480,204

$       

4,092,713

$       

2,468,717

$       

4,284,269

$       

Blackstone

26

Reconciliation of GAAP to Non-GAAP Measures –

Notes

Note:

See page 33, Definitions and Distribution Policy.

(a)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes amounts for Transaction-Related Charges which

include principally equity-based compensation charges associated with Blackstone’s initial public offering and certain long-term

retention programs outside of annual deferred compensation, adjustments to the Tax Receivable Agreement liability and other

corporate actions.

(b)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes amounts for the Amortization of Intangibles which

are associated with Blackstone’s initial public offering and other corporate actions.

(c)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes the amount of (Income) Loss Associated with Non-

Controlling Interests of Consolidated Entities.

(d)

Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss)

Before Provision for Taxes and adjusted to exclude the tax impact on any divestitures.

(e)

This adjustment removes from EI the total segment amount of Performance Fees.

(f)

This adjustment removes from EI the total segment amount of Investment Income (Loss).

(g)

This adjustment removes from EI the total segment amount of Other Revenue.

(h)

This adjustment represents Interest Income and Dividend Revenue less Interest Expense.

(i)

This adjustment removes from expenses the compensation and benefit amounts related to Blackstone’s profit sharing plans related

to Performance Fees, including Incentive Fee Related equity-based award expense.

(j)

Represents Non-Incentive Fee Related equity-based award expense and excludes all transaction-related equity-based charges.

(k)

Represents the adjustment for realized Performance Fees net of corresponding actual amounts due under Blackstone’s profit

sharing plans related thereto. Equals the sum of Net Realized Incentive Fees and Net Realized Carried Interest.

(l)

Represents the adjustment for Blackstone’s Realized Investment Income (Loss).

(m)

Taxes and Related Payables Including Payable Under Tax Receivable Agreement represent the total GAAP tax provision adjusted to

include only the current tax provision (benefit) calculated on Income (Loss) Before Provision for Taxes and to exclude the tax impact

on any divestitures and the Payable Under Tax Receivable Agreement.

(n)

Represents Total Segment Interest Expense.

(o)

Effective January 1, 2017, Fee Related Earnings, a Total Segment measure, has been redefined to exclude all Equity-Based

Compensation and Other Revenue. Distributable Earnings, a Total Segment measure, has been redefined to exclude Other Revenue.

All prior periods have been recast to reflect this definition.

Blackstone

27

Notes on page 28.

Continued...

Reconciliation of GAAP to Total Segment Measures

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

Management and Advisory Fees, Net

GAAP

630,092

$        

642,142

$        

686,586

$        

680,641

$        

719,687

$        

2,442,975

$    

2,729,056

$    

Elimination Adjustment

(a)

5,800

7,439

10,250

11,341

12,705

20,018

41,735

Total Segment

635,892

$        

649,581

$        

696,836

$        

691,982

$        

732,392

$        

2,462,993

$    

2,770,791

$    

Performance Fees

GAAP

741,563

$        

1,063,142

$    

756,397

$        

893,844

$        

991,773

$        

2,176,331

$    

3,705,156

$    

Elimination Adjustment

(a)

340

586

609

788

985

1,655

2,968

Total Segment

741,903

$        

1,063,728

$    

757,006

$        

894,632

$        

992,758

$        

2,177,986

$    

3,708,124

$    

Investment Income

GAAP

116,317

$        

211,156

$        

132,333

$        

170,890

$        

163,995

$        

356,051

$        

678,374

$        

Consolidation and Elimination Adjustment

(b)

(17,035)

(107,197)

(64,613)

(93,318)

(108,258)

(135,761)

(373,386)

Total Segment

99,282

$          

103,959

$        

67,720

$          

77,572

$          

55,737

$          

220,290

$        

304,988

$        

Interest, Dividend and Other Revenue

GAAP

Interest and Dividend Revenue

28,544

28,495

33,703

36,974

40,524

95,724

139,696

Other

52,853

(4,212)

(59,664)

(35,572)

(33,781)

54,753

(133,229)

GAAP

81,397

$          

24,283

$          

(25,961)

$        

1,402

$            

6,743

$            

150,477

$        

6,467

$            

Consolidation and Elimination Adjustment

(a)(c)

(14)

(4,074)

(2,805)

2,339

942

634

(3,598)

Total Segment

81,383

$          

20,209

$          

(28,766)

$        

3,741

$            

7,685

$            

151,111

$        

2,869

$            

Total Revenues

GAAP

1,569,369

$    

1,940,723

$    

1,549,355

$    

1,746,777

$    

1,882,198

$    

5,125,834

$    

7,119,053

$    

Consolidation and Elimination Adjustment

(d)

(10,909)

(103,246)

(56,559)

(78,850)

(93,626)

(113,454)

(332,281)

Total Segment

1,558,460

$    

1,837,477

$    

1,492,796

$    

1,667,927

$    

1,788,572

$    

5,012,380

$    

6,786,772

$    

Compensation

GAAP

304,347

$        

351,589

$        

367,203

$        

359,209

$        

364,484

$        

1,335,408

$    

1,442,485

$    

Consolidation Adjustment

(e)

(63,284)

(62,562)

(61,946)

(56,411)

(58,450)

(252,192)

(239,369)

Total Segment

241,063

$        

289,027

$        

305,257

$        

302,798

$        

306,034

$        

1,083,216

$    

1,203,116

$    

Interest Expense

GAAP

41,142

$          

40,246

$          

41,089

$          

41,545

$          

74,606

$          

152,654

$        

197,486

$        

Consolidation and Elimination Adjustment

(c)

(2,056)

(796)

(795)

(796)

(2,261)

(4,632)

(4,648)

Total Segment

39,086

$          

39,450

$          

40,294

$          

40,749

$          

72,345

$          

148,022

$        

192,838

$        

Blackstone

28

This analysis reconciles the summarized components of Total Segments (pages 3-7) to their respective Total Segment amounts (page 13) and to their equivalent GAAP

measures

as

reported

on

the

Consolidated

Statements

of

Operations

(page

1).

(a)

Represents

the

add

back

of

the

management,

performance,

and

other

fees

earned

from

consolidated

Blackstone

Funds

which

have

been

eliminated

in

consolidation.

(b)

Represents the add back of investment income, including general partner income, earned from consolidated Blackstone Funds which have been eliminated in

consolidation

and

the

inclusion

of

investment

income

on

non-consolidated

Blackstone

Funds

which

in

GAAP

is

recorded

as

Other

Income

(Loss)

-

Net

Gains

(Losses) from Fund Investment Activities.

(c)

Represents the elimination of interest income related to CLO investments and interest expense associated with the Tax Receivable Agreement.

(d)

Represents the total consolidation and elimination adjustments for Total Revenues and Total Expenses, respectively.

(e)

Represents transaction-based equity compensation that is not recorded in the segments.

(f)

Represents the add back for the amortization of transaction based intangibles, which is not recorded in the segments.

(g)

Represents the reversal of Fund Expenses which are attributable to consolidated Blackstone Funds and not a component of the segments.

(h)

Represents the inclusion of Other Income (Loss) which is a consolidation amount not recorded in the segments.

(i)

Represents the total consolidation and elimination adjustment between GAAP and Total Segments.

Reconciliation

of

GAAP

to

Total

Segment

Measures

–

Continued

(Dollars in Thousands)

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

FY'16

FY'17

General, Administrative and Other

GAAP

141,954

$        

106,044

$        

115,281

$        

115,755

$        

129,236

$        

520,309

$        

466,316

$        

Consolidation and Elimination Adjustment

(f)

(22,312)

(9,582)

(9,443)

(9,138)

(13,287)

(88,473)

(41,450)

Total Segment

119,642

$        

96,462

$          

105,838

$        

106,617

$        

115,949

$        

431,836

$        

424,866

$        

Total Expenses

GAAP

824,484

$        

929,650

$        

885,112

$        

903,760

$        

1,008,882

$    

2,928,574

$    

3,727,404

$    

Less: GAAP Fund Expenses

(g)

(23,232)

(24,076)

(49,669)

(26,350)

(32,692)

(52,181)

(132,787)

Consolidation and Elimination Adjustment

(d)

(87,652)

(72,940)

(72,184)

(66,345)

(73,998)

(345,297)

(285,467)

Total Segment

713,600

$        

832,634

$        

763,259

$        

811,065

$        

902,192

$        

2,531,096

$    

3,309,150

$    

GAAP Income Before Provision for Taxes to Total Segment Economic Income

GAAP

Revenues Less Expenses

744,885

1,011,073

664,243

843,017

873,316

2,197,260

3,391,649

Other Income

(h)

73,510

66,132

110,054

63,448

485,818

184,750

725,452

Income Before Provision for Taxes

818,395

1,077,205

774,297

906,465

1,359,134

2,382,010

4,117,101

Consolidation and Elimination Adjustment

(i)

26,465

(72,362)

(44,760)

(49,603)

(472,754)

99,274

(639,479)

Total Segment

844,860

$        

1,004,843

$    

729,537

$        

856,862

$        

886,380

$        

2,481,284

$    

3,477,622

$    

Blackstone

29

Walkdown of Financial Metrics

See pages 30 and 31, Walkdown of Financial Metrics –

Calculation of Certain Non-GAAP Financial Metrics for the calculation of the amounts presented herein that are not the respective captions

on page

13, Total Segments. 4Q’17 Fee Related Earnings per Unit is based on end of period DE Units Outstanding; 4Q’17 DE per Unit is based on DE attributable to Common Unitholders (see page

18, Unitholder Distribution) and end of period Total Common Units Outstanding; and 4Q’17 ENI per Unit is based on Weighted-Average ENI Adjusted Units. FY’17 per Unit represents the sum of the

last four quarters. See page 32, Unit Rollforward.

(Dollars in Thousands, Except per Unit Data)

4Q'17

FY'17

Results

Per Unit

Results

Per Unit

732,392

$               

2,770,791

$            

(288,857)

(1,109,706)

(115,949)

(424,866)

Fee Related Earnings

327,586

$               

0.27

$                     

1,236,219

$            

1.03

$                      

122,450

230,316

825,962

2,213,392

72,225

436,194

(29,509)

(49,918)

(79,568)

(189,988)

Distributable Earnings

1,239,146

$            

1.00

$                     

3,876,215

$            

3.17

$                      

Net Unrealized Incentive Fees

(67,617)

(4,191)

Net Unrealized Carried Interest

(291,682)

(206,023)

Unrealized Investment (Loss)

(16,488)

(131,206)

Other Revenue

(35,151)

(140,051)

Add Back: Related Payables

43,562

88,457

Less: Equity-Based Compensation

(21,396)

(107,110)

Economic Net Income

850,374

$               

0.71

$                     

3,376,091

$            

2.81

$                      

Fee Related Compensation

Management and Advisory Fees, Net

Other Operating Expenses

Net Realized Incentive Fees

Net Realized Carried Interest

Realized Investment Income

Net Interest (Loss)

Taxes and Related Payables

Blackstone

30

Unless otherwise noted, all amounts are the respective captions from the Total Segment information.

(a)

(b)

Represents tax-related payables including the Payable Under Tax Receivable Agreement, which is a component of Taxes and Related Payables.

(c)

Represents equity-based award expense included in Economic Income, which excludes all transaction-related equity-based charges.

(Dollars in Thousands)

1Q'16

2Q'16

3Q'16

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

Compensation

(287,403)

$  

(286,155)

$  

(268,595)

$  

(241,063)

$  

(289,027)

$  

(305,257)

$  

(302,798)

$  

(306,034)

$  

Less: Equity-Based Compensation -

Non-Incentive Fee Related

20,963

16,852

16,624

19,308

26,650

25,442

24,141

17,177

Fee Related Compensation

(266,440)

$  

(269,303)

$  

(251,971)

$  

(221,755)

$  

(262,377)

$  

(279,815)

$  

(278,657)

$  

(288,857)

$  

Realized Incentive Fees

28,450

29,363

30,295

83,993

47,137

41,106

101,198

187,858

Less: Realized Incentive Fee Compensation

(14,123)

(15,251)

(15,436)

(33,286)

(22,752)

(21,481)

(46,823)

(69,627)

Plus: Equity-Based Compensation -

Incentive Fee Related

1,061

1,670

1,554

1,539

3,264

2,548

3,669

4,219

Net Realized Incentive Fees

15,388

$      

15,782

$      

16,413

$      

52,246

$      

27,649

$      

22,173

$      

58,044

$      

122,450

$   

Realized Carried Interest

230,909

323,734

504,022

416,250

1,111,322

602,293

369,309

1,357,029

Less: Realized Carried Interest Compensation

(58,503)

(87,581)

(168,427)

(141,443)

(366,191)

(195,289)

(134,014)

(531,067)

Net Realized Carried Interest

172,406

$   

236,153

$   

335,595

$   

274,807

$   

745,131

$   

407,004

$   

235,295

$   

825,962

$   

Interest Income and Dividend Revenue

23,146

22,474

22,235

28,544

28,496

33,703

37,885

42,836

Less: Interest Expense

(36,497)

(36,020)

(36,419)

(39,086)

(39,450)

(40,294)

(40,749)

(72,345)

Net Interest (Loss)

(13,351)

$    

(13,546)

$    

(14,184)

$    

(10,542)

$    

(10,954)

$    

(6,591)

$       

(2,864)

$       

(29,509)

$    

Taxes and Related Payables

(a)

(16,794)

$    

(31,588)

$    

(51,089)

$    

(67,678)

$    

(25,324)

$    

(53,291)

$    

(31,805)

$    

(79,568)

$    

Unrealized Incentive Fees

7,100

8,007

32,172

2,450

60,016

48,527

(8,472)

(108,548)

Less: Unrealized Incentive Fee Compensation

(3,448)

(2,689)

(13,508)

(1,489)

(23,139)

(20,600)

7,094

40,931

Net Unrealized Incentive Fees

3,652

$        

5,318

$        

18,664

$      

961

$           

36,877

$      

27,927

$      

(1,378)

$       

(67,617)

$    

Unrealized Carried Interest

47,606

88,268

106,157

239,210

(154,747)

65,080

432,597

(443,581)

Less: Unrealized Carried Interest Compensation

(30,001)

(75,202)

(70,044)

(137,591)

4,387

(74,500)

(187,158)

151,899

Net Unrealized Carried Interest

17,605

$      

13,066

$      

36,113

$      

101,619

$   

(150,360)

$  

(9,420)

$       

245,439

$   

(291,682)

$  

Related Payables

(b)

-

$            

10,354

$      

30,104

$      

34,428

$      

6,519

$        

29,123

$      

9,253

$        

43,562

$      

Equity-Based Compensation -

Non-Incentive Fee Related

20,963

16,852

16,624

19,308

26,650

25,442

24,141

17,177

Plus: Equity-Based Compensation -

Incentive Fee Related

1,061

1,670

1,554

1,539

3,264

2,548

3,669

4,219

Equity-Based Compensation

(c)

22,024

$      

18,522

$      

18,178

$      

20,847

$      

29,914

$      

27,990

$      

27,810

$      

21,396

$      

Walkdown of Financial Metrics – Calculation of Non-GAAP Financial Metrics – Quarters

See page 24, Reconciliation of GAAP to Non-GAAP Measures – Quarters for this adjustment.

Blackstone

31

Unless otherwise noted, all amounts are the respective captions from the Total Segment information.

(a)

(b)

Represents tax-related payables including the Payable Under Tax Receivable Agreement, which is a component of Taxes and Related Payables.

(c)

Represents equity-based award expense included in Economic Income, which excludes all transaction-related equity-based charges.

(Dollars in Thousands)

2013

2014

2015

2016

2017

Compensation

(1,115,640)

$  

(1,153,511)

$  

(1,189,219)

$  

(1,083,216)

$  

(1,203,116)

$  

Less: Equity-Based Compensation - Non-Incentive Fee Related

130,124

45,133

96,901

73,747

93,410

Fee Related Compensation

(985,516)

$     

(1,108,378)

$ 

(1,092,318)

$ 

(1,009,469)

$ 

(1,109,706)

$ 

Realized Incentive Fees

474,333

261,745

194,746

172,101

377,299

Less: Realized Incentive Fee Compensation

(200,915)

(110,099)

(85,946)

(78,096)

(160,683)

Plus: Equity-Based Compensation - Incentive Fee Related

-

3,093

6,143

5,824

13,700

Net Realized Incentive Fees

273,418

$      

154,739

$      

114,943

$      

99,829

$         

230,316

$      

Realized Carried Interest

943,958

2,450,596

3,205,876

1,474,915

3,439,953

Less: Realized Carried Interest Compensation

(257,201)

(815,643)

(793,800)

(455,954)

(1,226,561)

Net Realized Carried Interest

686,757

$      

1,634,953

$   

2,412,076

$   

1,018,961

$   

2,213,392

$   

Interest Income and Dividend Revenue

70,936

76,052

95,661

96,399

142,920

Less: Interest Expense

(103,904)

(112,563)

(139,842)

(148,022)

(192,838)

Net Interest (Loss)

(32,968)

$       

(36,511)

$       

(44,181)

$       

(51,623)

$       

(49,918)

$       

Taxes and Related Payables

(a)

(156,734)

$     

(280,788)

$     

(90,470)

$       

(167,149)

$     

(189,988)

$     

Unrealized Incentive Fees

(19,928)

(29,425)

(7,249)

49,729

(8,477)

Less: Unrealized Incentive Fee Compensation

11,651

19,276

2,490

(21,134)

4,286

Net Unrealized Incentive Fees

(8,277)

$         

(10,149)

$       

(4,759)

$         

28,595

$         

(4,191)

$         

Unrealized Carried Interest

2,158,010

1,708,961

(1,595,296)

481,241

(100,651)

Less: Unrealized Carried Interest Compensation

(966,717)

(379,037)

312,696

(312,838)

(105,372)

Net Unrealized Carried Interest

1,191,293

$   

1,329,924

$   

(1,282,600)

$ 

168,403

$      

(206,023)

$     

Related Payables

(b)

74,570

$         

81,276

$         

62,943

$         

74,886

$         

88,457

$         

Equity-Based Compensation - Non-Incentive Fee Related

130,124

45,133

96,901

73,747

93,410

Plus: Equity-Based Compensation - Incentive Fee Related

-

3,093

6,143

5,824

13,700

Equity-Based Compensation

(c)

130,124

$      

48,226

$         

103,044

$      

79,571

$         

107,110

$      

Walkdown of Financial Metrics – Calculation of Non-GAAP Financial Metrics – Years

See page 25, Reconciliation of GAAP to Non-GAAP Measures – Years for this adjustment.

Blackstone

32

Unit Rollforward

Common Unitholders receive tax benefits from deductions taken by Blackstone’s corporate tax paying subsidiaries and bear responsibility for the deduction from Distributable

Earnings of the Payable Under Tax Receivable Agreement and certain other tax-related payables. Distributable Earnings Units Outstanding excludes units which are not entitled to

distributions.

4Q'16

1Q'17

2Q'17

3Q'17

4Q'17

Total

GAAP

Weighted-Average

Common

Units

Outstanding

-

Basic

655,074,617

660,939,708

664,681,299

667,384,727

668,781,321

Adjustments:

Weighted-Average Unvested Deferred Restricted Common Units

1,643,603

809,184

998,974

663,474

702,960

Weighted-Average Blackstone Holdings Partnership Units

539,139,078

537,758,091

534,326,066

532,454,091

-

Total

GAAP

Weighted-Average

Units

Outstanding

-

Diluted

1,195,857,298

1,199,506,983

1,200,006,339

1,200,502,292

669,484,281

Adjustments:

Weighted-Average Blackstone Holdings Partnership Units

-

-

-

-

531,139,507

Weighted-Average Economic Net Income Adjusted Units

1,195,857,298

1,199,506,983

1,200,006,339

1,200,502,292

1,200,623,788

Economic Net Income Adjusted Units, End of Period

1,196,223,079

1,199,565,618

1,199,890,628

1,200,559,970

1,200,553,187

Total Common Units Outstanding

654,833,530

661,126,963

665,503,840

667,027,762

668,733,356

Adjustments:

Blackstone Holdings Partnership Units

537,393,402

535,206,716

530,678,056

532,235,827

530,472,212

Distributable Earnings Units Outstanding

1,192,226,932

1,196,333,679

1,196,181,896

1,199,263,589

1,199,205,568

Blackstone

33

Definitions and Distribution Policy

•

Blackstone uses Economic Income, or “EI”, as a key measure of value creation, a benchmark of its performance and in making resource deployment and

compensation decisions across its four segments. EI represents segment net income before taxes excluding transaction-related charges. Transaction-

related charges arise from Blackstone’s initial public offering (“IPO”) and certain long-term retention programs outside of annual deferred

compensation and other corporate actions, including acquisitions. Transaction-related charges include certain equity-based compensation charges, the

amortization of intangible assets and contingent consideration associated with acquisitions. EI presents revenues and expenses on a basis that

deconsolidates the investment funds Blackstone manages.

•

Economic Net Income, or “ENI”, represents EI adjusted to include current period taxes. Taxes represent the total GAAP tax provision adjusted to include

only the current tax provision (benefit) calculated on Income (Loss) Before Provision for Taxes and adjusted to exclude the tax impact of any

divestitures.

•

Blackstone uses Fee Related Earnings, or “FRE”, which is derived from EI, as a measure to highlight earnings from operations excluding: (a) the income

related to performance fees and related performance fee compensation, (b) income earned from Blackstone’s investments in the Blackstone Funds,

(c) net interest income (loss), (d) equity-based compensation, and (e) Other Revenue. Blackstone uses FRE as a measure to assess whether recurring

revenue from its businesses is sufficient to adequately cover all of its operating expenses and generate profits. FRE equals contractual fee revenues less

(a)

compensation expenses (which excludes amortization of equity-based awards, Carried Interest and Incentive Fee compensation), and (b) other

operating expenses.

Blackstone discloses the following financial measures that are calculated and presented on the basis of methodologies other than in accordance with

generally accepted accounting principles in the United States of America (“non-GAAP”) in this presentation:

•

Blackstone uses Adjusted Earnings Before Interest, Taxes and Depreciation and Amortization, or “Adjusted EBITDA”, as a supplemental non-GAAP

measure derived from segment reported results and may be used to assess its ability to service its borrowings. Adjusted EBITDA represents DE plus the

addition of (a) Interest Expense, (b) Taxes and Related Payables Including Payable Under Tax Receivable Agreement, and (c) Depreciation and

Amortization.

Distributable Earnings, or “DE”, which is derived from Blackstone’s segment reported results, is a supplemental measure to assess performance and

amounts available for distributions to Blackstone unitholders, including Blackstone personnel and others who are limited partners of the Blackstone

Holdings partnerships. DE is intended to show the amount of net realized earnings without the effects of the consolidation of the Blackstone Funds. DE,

which is a component of ENI, is the sum across all segments of: (a) Total Management, Advisory and Other Fees, Net, (b) Interest and Dividend Revenue,

(c) Realized Performance Fees, and (d) Realized Investment Income (Loss); less (a) Compensation, excluding the expense of equity-based awards, 

(b) Realized Performance Fee Compensation, (c) Interest Expense, (d) Other Operating Expenses, and (e) Taxes and Related Payables Under the Tax

Receivable Agreement. DE is reconciled to Blackstone’s Consolidated Statement of Operations.

Distribution Policy. Blackstone’s intention is to distribute quarterly to common unitholders approximately 85% of The Blackstone Group L.P.’s share of

Distributable Earnings, subject to adjustment by amounts determined by Blackstone’s general partner to be necessary or appropriate to provide for the

conduct of its business, to make appropriate investments in its business and funds, to comply with applicable law, any of its debt instruments or other

agreements, or to provide for future cash requirements such as tax-related payments, clawback obligations and distributions to unitholders for any

ensuing quarter. The amount to be distributed could also be adjusted upward in any one quarter. All of the foregoing is subject to the qualification that

the declaration and payment of any distributions are at the sole discretion of Blackstone’s general partner and may change its distribution policy at any

time, including, without limitation, to eliminate such distributions entirely.

Blackstone

34

Forward-Looking Statements

This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and

Section 21E of the Securities Exchange Act of 1934 which reflect Blackstone’s current views with respect to, among other things,

Blackstone’s operations and financial performance. You can identify these forward-looking statements by the use of words such as

“outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,”

“intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking

statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual

outcomes or results to differ materially from those indicated in these statements. Blackstone believes these factors include but

are

not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended

December 31, 2016, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange

Commission, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and

should be read in conjunction with the other cautionary statements that are included in this presentation and in the filings. Blackstone

undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future

developments or otherwise.

This presentation does not constitute an offer of any Blackstone Fund.