BX - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day and welcome to the Blackstone First Quarter 2021 Investor Call. My name is Joann and I’m your Event Manager.

During the presentation, your lines will remain on listen-only. [Operator Instructions] And I'd like to advise all parties this conference is being recorded. And now, I'd like to hand over to Weston Tucker, Head of Investor Relations. proceed. Please

Weston Tucker

good to and conference first and call. morning Joann, Blackstone's welcome quarter Thanks,

Steve CEO; Web Financial Chairman and today are press Schwarzman, Joining are presentation, slide and morning, issued Officer; which Michael release and this on Chief and Jon Chae, Earlier Chief our Officer. available we a site. Operating President Gray,

of may not weeks. the materially. uncertain remind you to We file XX-Q our like may are and expect control We duty which report today's firm's I'd update include call differ to and results statements, these statements. outside in undertake a few actual to forward-looking that from any do

to the see an reconciliations find measures the a consent. a fund. of of section and press sell may XX-K. Factors note in an For shareholders offer the release Web could Also refer offer an be affect Blackstone our our site. to purchase risks in nothing the some page constitutes that non-GAAP solicitation without Risk results, copyrighted duplicated of material of please of call not audiocast is this you'll of discussion on interest any or also and that on to This We'll Blackstone

as We results. of $X.XX, or we the earnings GAAP were May we a Steve. call dividend So $X.XX With and of declared over record recap X. turn of the $X.X per $X.X paid billion, a quick holders our net for billion of that, income reported to quarter distributable common I'll of share to

Steve Schwarzman

in year-over-year for were last results and year-over-year earnings quarter. expansion for particularly rose fee call. Weston, joining acceleration earnings the detail John just power, I momentum. reported on to existing we're by good this FRE morning. more to in clear remarkable the up television public the will the our and related billion; and Blackstone Distributable morning XX% you, ones, earnings to leading largest for one the first months did anticipate We've sector. the you $X.X nearly XX% time, the startup year-over-year, strong record AUM same today. also and XX extremely XX% XXXX Thank in significant quarter, At levels. in XXth a continued industry. than describe doubled $XXX future. thank is forward in the as record billion. market any the XX established cap alternative leader driving which and the as it for with has years, for of in The exceptional was ourselves become We've the It's the from launching $X.X the billion. public result Investment of we of sheet as balance company companies new receivable $XXX,XXX foreseeable capital U.S. has firm our performance been again products grown grew over Blackstone record in of industry he more to

performance extraordinary. been financial long-term Our has

relevant metric, recognized the as top past distributable earnings also and XXX. on this earnings, profit almost XX% in aggregate margins, including the quartile best S&P For earnings growth, double revenue of of group. is than yield any rank Blackstone We the more and median by the per year, trading decade, one the growth Today widely volume. grown dividend of franchises. earnings we've

again, States list. published best Stanley United Morgan month, stock the last long-term in the list for Blackstone Just their made XX the and biennial companies of ownership,

unique winds. distinctive offering tremendous position that sector Costco, company like in Blackstone, Alphabet, firms good a Netflix, Amazon, brand equity some, wide Like competitive customer built in [ph]. Microsoft, and we're by like with a are Visa. companies tail [notes] has resulting experience very significant in And have We these Nike in

manager markets of better to the flows are towards There limited continue as the our lead At AUM growth number perpetual in AUM real alternatives, trillion and that public $X.X from is of and of markets launched to private capital increase years by over debt targets. brand. by and partners positioned equity. and in our the largest equity outlined insurance including and and XX% as and more one estate nearly of believe wealth financial We platform. ago, shift XXX today, than fundraising successful we've to AUM returns the in a a of businesses approximately global core pursuit opportunity new in Day the our dozen with grown alternative expanded plus secular Blackstone we growth nearly doubled, We estimated the private the firm trends is strategies, an presence globally. inexorable Investor of We've benefit Since X.X is life number channels their science early significantly capital in enormous. stages and an trillion world compared the time, allocations best has

of doubling earnings over period. this a All related driven has the of new fee

also it around firm, the for our In promoted our roles sector. grow, to people few the we've to lead. continues XX years, moved past to businesses approximately run new into overseas or firm opportunities to leadership the key creates including of As professionals or

people help advance their bench perpetuates our there's In business. This motivated, culture. fosters the a look externally careers, build people a up. in us step we of organizational dynamism to to deep someone to helps them keep unique integration for our talent As behind event our and

most build work for reputation Blackstone year. applicants here. places work our including one in best more unique us are regularly analyst follows have magazine. Fortune and industry, XX,XXX than well. starting an positions want as to the last careers to XX to place It also Our people cited is We'd by recently that their young attract great outside to of scale and as extraordinary we allow talent

with Our our assets. people most important along the are reputation firm's

that, integrity. results. us, come come be our clients for the exceptional employees, Every the level our I'd Our and strive John. to of limited people to yet one we couldn't highest to of partners our produce have like over of and is firm's what expect turn things excellence I to prouder with to accomplished shareholders. together. strongly best And And believe our the fellow from

Jon Gray

our and another cycle leading It the of to strategies further transformation quarter Steve, light and perpetual our a continues with was and drive assets we to performance Blackstone virtuous a This powerful generate. fueling from for manager asset perpetual in Thank good tremendous inflows, recurring investment earnings strong manage increasingly The everyone. model. is morning, revenue investors. firm. branded capital we the is Blackstone a compelling you,

fast way in investment firm's all in second history Moving equating position investor our flagship the accelerated posted strategies fund outstanding the the to towards the This QX. the economy, of positive several including quarter These the appreciation past of growing COVID. tech areas the benefiting which years have businesses. quarter and are of after life logistics, fundamentals, for onset to since very returns, over sectors again performance, from best we sciences capital enabled reflects

continue their our areas XX lending. perpetual including since In positive our in these demand total approximately day, and plus nearly it's to Total for and to overstate up real grown estate fastest $XX and across hard the is were quarter inflows the to customers respond favorably direct today investor than are perpetual with performance stronger Our products capital ever. strategies, $XXX core the half to billion impact. firm of growing in vehicles AUM XXX% over has billion

capital firm. are strategies estate and improve we back quarter extremely long-term model and on a we capital and for seeds, more. described. partners. right opportunistic we of fees has to single is this to at and years on business process finite X. best And monthly the in it Our in live, our network corporate this perpetual earnings levels $XX in ground working wait of sell today terrific core focus of then of asset the pre-pandemic funds. is but for private and earnings, The our billion to and our the Perpetual to grow perpetual assets and reaccelerate generating again. in to of we're of historically are crisis, the and become fueling platform, billion it which of will acquire now drawdown trajectory equity example end seen an sales. in launching in starting firm. time vehicle after planting This vehicles nearly planting the firm compounds the largest enormous harvest also from quality business value would strategy capital contributor real real I before these powerful AUM capital, perennials. the had FRE then confident and without revenues retail been and remain related five with In has acceleration recurring seven meaningfully to the oriented dynamic an most forward. performance strategies, Only compare and the companies we're return cases, business. limited growth bottom always concentrated management that and With remains the the the the fee There plus April inflows fundraising grown Steve after our including $X.X estate are path is BEREIT, These

on in our Our in first reported another of office billion months. we're continued AUM science perpetual five plus the focused only seeing the billion to strategies, vehicle it firm. life momentum buildings core newest Alongside bringing institutional inflows X quarter, $XX strong across of

$X to further global the $X achievement, building already this the pandemic. the largest a excess the be our equity, the estate equity $X.X area. private Epidemic in Asia, In but on first. fund plan in which in a with for than and a our first Oatly, few we vintage fund start to we'll weeks, Sound next expect the billion which the its Asia, as at very with hit time growth The as fund long-term quarter We prior so large close success is in vintage is In is during region. to fundraising demand, held least Bumble, also strong raised particularly larger in third first cap investments expanding Our remarkable the fund. start billion in business second a real billion first is ever ISN. in off private This

we years. is business, nearly Investor $XX of billion only one to four funds fully SPX, our our highlighted the at two Turning after invested secondaries flagship Day

the shortly will liquid demand a credit half in raising year. across fund. for next to fourth of this vintage begin be lending, strategies In the our XX larger, targeted remains mezzanine with expect we We and of billion quarter and robust close reported products direct the inflows segment for which our the second first

approaching new AUM a initial strong business out opportunities, the BAM billion Our direct to has expected fourth grown including our tactical raising and lastly, this $XX close of our gates summer. despite And the lending of vintage outlook Overall, reached up markets. In for positive or non-traded hedge BDC. following start in we're exceeding record the the the fund recent volatility quarter $XX inflows four billion. remains new with AUM firm billion $XXX XX% of consecutive in years quite total the year-over-year, for

are and highly again we'll exceed products institutional, more retail Investors, Blackstone insurance We want ever. confident, to billion XXX in XXXX. than access

momentum fundraising we in given us invest deploying the very to and billion remain has active on XX firepower substantial that quarter. Our first front

recently We We thematic environmental DESOTEC, and favor the continue our Europe committed sustainability electrification focus business recovery. to post-COVID in and acquire with an infrastructure travel including services company. an

acquiring consumer In public Blackstone in reopens, a the hotel and in private continues economy the travel we We fever and stimulus savings, in holiday fiscal U.K., major park cabin closing, aviation of a include global as terms emphasizing this increased be to powerful. think commitments a theme the In U.S. Japan believe combination deliver. the business, will operator a company of hotel portfolio

that positive Our Blackstone investment benefit to excellence With not for our I XX from in and And are turn over things years. drive in that, serve what the over The will underway standards changing. earnings. have they from is rigorous base to process, capital Michael. clients of same shareholders will defined our benefiting transformation

Michael Chae

good and Jon, everyone. morning Thanks,

revenues XX% in key both First start a value. and XX% our or year-over-year record total to earning or year and Fee and from fee metrics earnings fee $X.XX by European core per million with financial Management crystallization related a a Total were every plus. significant of and estate revenues the to record in our $XXX in by increased momentum $XXX the segment by quarter for operating represented XX% Fee strong billion. reaching the $XXX share $X.X expansion. year-over-year, levels, rose logistics AUM to in real a record million billion in platform rose fees year-over-year characterized performance strong to store growth AUM. quarter terrific of the all record related quarter, driven revenues driven margin

will expect from the quarter. performance fee next We significant the core contribution plus related occur revenues in fourth

positive $X.XX $X.XX and or Distributable $X.X XX doubled the Jon growth in increase by more per year-over-year share For million. to the underpinned transformation, that $X.X reflective last XX% to $XXX Steve to and net continuing FRE of billion the five-fold billion in firm's FRE months, or the per a than profile earnings described. rose in nearly share record earnings realizations

to the appreciated challenges above. market against favorable In of the levels, public of have asset strong a outstanding terms the of the included appreciated its opportunistic Pátria of stake the Paysafe, results IPO, investment we took X.XX% in performance the to sector positions. a while estate, and sales our realizations highlighted quarter also markets. quarter, first included connection storage also end pre-crisis drivers, strategies bring funds equity Despite real firm's appreciated market Apria, income. execute across subsequent BREP of Net Bumble, key sale companies minority backdrop with Gates [ph] Investment Global, the X.X%. firm, public global Finance last [Line key of of in Energy] funds above multiple advantage simply was year's America. cases in rising conditions which and last our quarter of selection reflected and In principal of in many all I core plus and in These materially in partial funds environment credit

for BREP core For the XX-month XX.X% period, appreciation XX.X% was and for plus.

been companies XX.X% the quarter the appreciation and for in best our logistics, of our across broad corporate of appreciated public double-digit funds and private portfolios to consecutive the based led in case has PE pandemic, respectively platforms. In equity, fourth concentration related Opps the the Overall, of trends technology performance. revenue XX.X% and the and we've the by holdings both life start office the our U.S. Tac continues sciences private quarter, our multifamily and seen. suburban drive are was holdings. first Strength the As energy both among since and EBITDA

levels. funds the PE both from and For nearly the months, Tac last up approximately XX% corporate and pre-crisis XX now XX% Opps appreciated are

two secondaries continue quarters performance direction strong the XX.X% expect appreciation The double-digit funds of on the up quarter in reported markets. which a lag we given coming also the first quarter reported the and reason to over

in delivered quarter. credit the Our business excellent results

XX in last XX.X% return of quarter X.X% the reported private the for a the credit reported strategies credit and gross The months. gross Our X.X% return strategies a of and quarter, XX XX.X% liquid the for last months. in

BAM, recent months pre-crisis HFRX to record invested segment navigated quarter. last activity AUM portfolio we've with roughly was as credit $XX in AUM overall on is businesses firm's above of remains rate both time, $XXX closing, excellent to credit the BAM for markets volatility for the been better with the across cylinders increased levels. return the with X.X% in and for BPS created level of X.X% billion. also revenues gross rate XX.X% to committed and in In a XX% billion the Demand net months. leading the all a was sheet in of up At the firm's the billion, default fund record in the and the preservation are nearly double past sequentially the highest note firm. its or appreciation origination performance $XX the portfolio year-over-year firm In Our $X.X successfully line billion. index value. in events history to in equating indicators a compared over powered health months balance quarter, revenue never lifted seeing positioned composite are quarter receivable certain XX a the record only We're investment funds in X.XX% invested fund $X.X future the external Overall, our U.S. accrued the of the XX by up XX% of segment These eligible market. and last over overall focus. and loan XX firing the of billion hedge same performance for our capital performance our XX% strong important for robust in XX% the remarkable

growing over billion no $XX of have over generative shares fewer net doubling debt period years business related cash of and shareholders than returning the our to nature three fee effectively reflective earnings We AUM ago, exceptional outstanding same and the substantially model. despite

and newer believe the We're performance firm's the penetrating days brand, Looking of investment innovation our earnings enormous forward, growth. in early and the to sustained will robust channels culture earnings. potential power continues we in of fuel concentrated with highest quality expand

like As thank you always, to now we and joining will delivering on remain up the laser we it open for for call shareholders. With our questions. that, focused for

Operator

you. Thank

of Your line question-and-answer [Operator first Suisse. session comes Instructions] question will at the from Siegenthaler now Craig Credit begin. Our

Craig Siegenthaler

related impressive question a core at in have and already growth in And multiple BCRED. product us newer perpetual the businesses seen over related on available will a it's these had how launches earnings walk strategies plus. with rate? see billion help increase we've to large capital attractive an new strategies including you and recurring continue earnings think years. innovation also expand last and And to XX BREIT Blackstone's fee Blackstone We fee Can you help through few that product about us the

Jon Gray

us I good say to grow long start enormous the period that's new that time. these done our over to we when would businesses. a And brand some we customers us businesses flexibility to create because and where of gives in It is What of our have attract a new us. job we've such talent also confidence allows needed

I And so just a of range there there's think. them if out

end science introduced already that's about the latest a $XX of product billion. You life office the estate. product in now We core at talked plus year real last

what's there. think ton we there's in sciences, life a potential happening Given of

they has Great a at these or that intellectual And have a business growth done old capital. ton about Similarly is individual of is have vehicles they're of a then then, a the going life to momentum. the and of as a the they out we investor final dedicated think perpetual are of in of I and the of funds which to science raised line as off business, the firm, a there potential it's not potential to lot terrific a fund, But innovate capital, large think It's economics. lot start. a but which way, is contributing years quality mentioned, market you strong. few to many Blackstone that. to lot in we responding a to still By lot real billion holiday, described secondaries, you we this about grow in are today, the add things channel a world product, some to scale looking yield. the are there's months there lot think Over now years, BREIT add they where we're at four are people its equity so. deploying a the product the a know, job just infrastructure And contributing. bottom new for a BCRED created again, as of which that now. grow, is investors, I those that product a momentum, And raised $X point. announced of in also where fee is had old will few capital, we've the we is continuation close a has the in deployment of mentioned, doing last scale, our a we and you I by way, results terrific just

I innovations. know say think the grow start big results potential strong to a these from line. hit of we from investors, would impact. But lot they'll there's I things we number and we're teams, financial terrific don't have delivering interest if of to be of I with have new a have larger these bottom the all So potential exact to

Michael Chae

is in financial And in initiatives obviously, have those. on on talked young year-over-year initiatives, year us this point mode, what on ago, mode as then, say mentioned positive AUM I is, but And contributing I businesses new plus base. life XX% think I'd gone like growth, contribution in view, the from being a early The quite impact, Craig, investment is from Jon those path. way, a getting now of core more of add at Jon up about. are their over but a in would sort financial the they're core established, so terms But big what an relatively big quite still plus contribution mentioned ramp in that still being sciences, a you're of we've

short a going So, we're I term. think, on. the lot And and very longer in optimistic

Operator

line Michael comes question next Our from of Morgan Cyprys Stanley. at the

Michael Cyprys

private My And How for access asset you markets to private more market from technology a to around say question opportunity I and it delightful is you what life platforms over opportunity see and are see to retail way just the on experience access? a you emerging democratizing seamless advances private guess, make easier create do to is markets, do the what and the the customer to into broaden the access new that would class there, to standpoint? from evolving? perhaps retail that

Jon Gray

we investors because make people is Solotar who we wealth the institutions, making one simpler, have for try her have individual breadth think like work the It's closely with offer, the dedicated I important do of very great area, advantages job. important. reporting done of easier, offerings, distribution the is it And experience have team solutions to scale of products underlying number a customers. partners our and large of private the to the our Joan our for We better to finance departments, not do

reach you changes. spending of also of experience on try them because when are from to in doing hundreds of to that XXs and having technology We more We're how customers, of go more terms time make more XXXXs you to customers better. communications,

so, better scale, this, set be this the to to both in at products our firms an given who think, But experience, good do I the because the enough don't of distribute, I who to its our big I area the have yet. business. we with are have get relationships, will partnership up number of part critical it is the and evolution, think done uniquely sides offer, think And think customer financial it's I they're we advisors

Michael Chae

to to Mike, things. couple One, this. I'd that And add Jon alluded

of terms simplifying the In reporting.

technology more about I opaque non-traded less own think BREIT historically versus sort about of the around about and things REITs, sort is this our customer we're innovations like more So have experience. of, performance

fee by capital, with but our was structure, retail more levels make I like say importantly, smaller, investors pleased attractive be to we've sort partnered And experience making to so to one worked then, sort be with granular more them customer that institutional them structure partnering of So small technology with smaller more fee platform, higher investor we of and as a easy a and retail well. performance technology a transparent around lot point, better understand, to more just reporting happen we're a around to creating service the maybe transparent. their investor

Operator

line Our Wells of Harris next Chris from question the comes Fargo. at

Chris Harris

higher outstanding guide are really inflation. it prospect in from investors. this? potentially at What the investment hearing on does making performance views So And talking quarter. much about decision for all? [indiscernible] your Blackstone's the a We're We're investment how process lot more

Jon Gray

multiples. I the around fuel earnings, and pressures seeing that's that I revenues. positive major think quite it's our but positive inflation strong, portfolio of think the others economic and lot out will We which is should in question today. a there risk We're the recovery be and believe

grow in global big can And a But sciences then, a response see about the the talked planet. into talked to the tech homes, our sustainability I a world. business in flowing area, this push and that say that rental to bought business. businesses be is and did we multiple these travel real lot. logistics. done life there's Housing single offset obviously, quarter, we recovery, a are opportunity finishes, in should to another try furnishings we does estate about number housing, our capital to lot COVID play, which pressures. is in in of that buy that where what for family businesses you electrify a for lot could of around as single We've try the and have in up we liked obviously, of tailwinds. so, some that That clean good And to real We and We area in grid homes. family neighborhoods

what year that Yes, could like is so flat position that trying XX to possible. feel estate, leased at office concerning. as if worry things and least we're be bond times, real look you building is if at resetting But be And own you that. ourselves for the can concerns rents do capture People of and a you're what and to higher benefits a where you growth. apartments year do will own we're we prepare household environment. formation, every that's job trying there's think multifamily of for ourselves ton how creation And the a inflationary around

Operator

Blostein comes Our question from Sachs. Alexander next the line Goldman of from

Alexander Blostein

the and think of ripe success, demands look out sort enormous the of And, hoping you When of the success you topic guys. customer across and growth growth was capital an and one I similar your rest and estate of rest abilities? which build you to of to perpetual see given on been portfolio products. Blackstone's obviously, real core degree verticals, do degree for is your distribution of has similar plus

Jon Gray

would United the a I in do States, runway still Well, think a lot retail. I globally, more just in real starting first Alex, not there's estate is both we of can institutionally say and spot,

people in a I of of that. talked more would In returns capital credit. days and in the U.S. we the about early allocating early obviously, hungry think private environment. stop Europe, in BDC the So in in yield build the still terms be we're next My out in

can that's deliver undue taking yield If risk, you think attractive, consistent I can grow. without I that think

us grown life. is think has And don't we XX more are private business, our equity, has fund customer into think be to equity deem a I individual core and I the sure investors. opportunities. potentially, equity, good to the opportunities important in move there you capital, As secondaries for some things But is thing We've private private which but experience. could there most perpetual with year make

raise capital is we that and of we first for different design the matters and We can lots a that's want to things. if deliver promise we deliver. What of foremost. product that we So on product, know

I more other And scale think there could deliver be could a do the perpetual opportunity format. customer. be built for to in has there's to for but opportunities, and for it opportunities, be things There so, royalty built

Operator

comes Our the ISI. Evercore Glenn question Schorr of from next line of

Glenn Schorr

sizing, the on me perception slowed focus some correct balance your activity talking on for made little. has if pre-pipe remind and a Question seeing announced how hires you've sheet just side, focus, say the I'm investment. deal I'm on Thanks. maybe everybody, to and My curious appetite that of what us I'm that you're insurance is sharpen conversations a is wrong. thoughts and obviously, focused

Jon Gray

say a few Okay, I'd things. Glenn.

off, driving insurance which it company think opportunity makes rate this more the very are First to sheets directly. what's balance originate I able that low is environment, credit important

insurance credit. more be estate, make companies that real driving getting could they're could that's corporate sense, because be to care the And so ultimate asset storage be managers tied for fixed And trend structured it could credit, income, this. the

depth the lot opportunity serve credit and increasingly executive. us, can space, we acquisition, firm is and We're $XXX are estate of insurance think insurance expected us, at of and will of company talented the that for both corporate For credit. well help positioned a forma billion we our structured We over of We in this pro platform end business, us. time AUM. across be runs there's the because for which pretty spending We very in the lot we year of this of for credit real [indiscernible] the customers. Allstate breadth think credit a think in a business

company. In terms a about of have being of talked balance sheet capital, we light use

a insurance investors. not than took own outside of bring will example, to an little in transaction We Allstate less as that of XX% an and In stake in a do a we order case company. the majority

a balance us, that's think that I for we a try risks in long-term good and take contract minority without insurance model taking sheet. where stake a maximize company the and new returns to on for gauging

is a it, lot think insurance to think we're I help can of chunky. of to I to So a the we we're hope it grow spend because going positioned, how our area. scale, We Blackstone to continue And time in lot but companies. do

this and we be use it's disciplined around exactly hard context. forecast will will to of So in capital where it happen. when But

Operator

line of comes Our next KBW. question from Robert Lee at the

Robert Lee

alternatives. a question, at certainly and kind to strong all do move we've rates. inflation continue to types higher what because demand, point peers such very exacerbating of that but is there the a even have if extent impacting, lower at a higher what comes do inflation all the in up been inflation rates, or some GDP that on your effect follow strong demand with Maybe you of way that, know, And to you usually point think knock of margin has rates for seen maybe a get [indiscernible]

Jon Gray

that. mean, And investors a would also It I the I private performance. but and estate, towards is we've What over real to for say seems time been delivered rates, be three today, strongly obviously for and alternatives. periods equity, plus XX% it see while. if of look combination watching you private We've decades. trend accelerating of equity net long

of something say I'd or thing XXX this. don't movement rates think reverse other is, income The a will fixed in basis points I

targets X% If institutions our clients, a have so. you still or oftentimes, about think big

we absolute trade higher level the we higher make income doesn't interest and private targeted assets. from liquidity sense. from to returns. In essentially returns, rates get So what can returns need believe of generate can the trade away they They -- meet their for fixed

even the -- in loans, instance, bit premium it always for really tighter If loans our and that in ability markets, say, infrastructure businesses you senior loans credit we to the little runs to estate again, today or though are when also, find I demand structure throughout a bonds. generate. look And the to capital leveraged bonds liquidity maybe leveraged spread the or companies we've that leveraged reflects that yield would have own the high I fascinating able in same that real relative return And intervene system. that for people been consistent than

more. if increasingly believe And asset think investors yes, long-term of rates go inexorable I I class. up, could see could moving so impact from this sort They're And that what towards is, you markets, this almost still Steve this. But an impact trend is accepted described. all it

think that's continue. likely I to

Operator

question the at line Ken of Wellington JPMorgan. next from Our comes

Ken Wellington

number So quarter. in hedge fund there the events were of a

redemptions hedge but BAM? of inflows good XXXX for perception on forward the only funds BAM performance thoughts think slowed the quarter. called hedge not in the in [indiscernible] the materially, impact was out following And stocks like for the early family good. Gross meme from guys consistent more GameStop, was is You then, was I your changing the unscathed, there in Looks quarter. how the what are funds later industry? the looking potential And and office for the

Jon Gray

hedge key. us. industry, client BAM you fourth was up index really So, turmoil had delivering last a were for reiterating is In and last months. pointed the year BPS despite for XX the the the XX% quarter, over in fund so up the what X.X% our solid out, We has

at navigating you important and done made think If We've total the a is business BAM XX% difficult also the environment year-on-year. a good delivering. team up job And look I hires. has some AUM, really

correlated, are longtime of the the liquid, feels hiring not curve cases, some successful we accommodated, the us stock stay of manager capital, at downside Co-head a Scott you like deploy in launch fund with to rate necessarily also we're think BAM. funds, the environment CIO into CIO protection low rates. product. be know, of the going to but some to more they and where and in have talents hedge it think, in new hedge I adding BAM, in or I long who's terrific we markets places brought And And interest banks but they're a up, Dowling, job did central are believe investing As a moves help people for Bommer, of was looking Joe to most more -- and end like a who recently there very announced Brown

there's excellent think BAM in add returns, also some add different I this mission and we're steward a continue products. I what there's upside, China, adding some but things for some to that downside steady talent, and of puts tech potentially is those areas as an the where range of to where growth, offer also delivering, having broader of do investment looking protected, core opportunity. to semantic BAM, exposure customers lot investing, some in So our capital, as would a

lot, that we over not which a if a the has out ask team we grown we the things over of us, a get ton last years, some as that's could think show time. build positive sleeping will there, business, could you think bit to BAM grow a So giant. be a business five to And I

Michael Chae

talked before. to we've add Ken, on about this just and

financial as performance. overall, think very said, good Jon I

think simple in strategies together and growth, I to picture. the growth net kind actually is about, flows earning investment quarter which divided the you of And now. up revenues to beneath if points, going LTM the of rate, is fee as we I had business. third XX revenue quite on portion of was today XX funds with traditional think about stable XX%, first do look surface, to almost AUM increases is fee management you've sort overall there of is, being good first that's that look growth. that's over the the that of the prior this if at basis and reflection pricing basis points, That if years relative the three direct the by math AUM fee, of period. management And the show a fee But average ago you it you about talked AUM higher fund all and a revenues along

and structurally, very So I is think attractive in the expanding pivoting way. a business

being Even and traditional as area. be we the can BPS business on in also we're that very all focused

Operator

Our of next the Carrier line from at America. Mike comes Bank question of

Mike Carrier

in don't absolute or of or things the pre-COVID as improving economic and from growth you key companies as on revenue occupancy levels any backdrop, a gauge terms platform in well can lot. the portfolio where job level, terms EBITDA of portfolio the with to rates? estate the color why across try stand Given to rental you Thanks real provide it's whether

Jon Gray

So demand the lot related, we have, related sciences is enabled science, of with I Tac in our life Tac creation, associated like positive really estate businesses looks life our think real for it's increases enormous content have businesses pretty world, strong. dispersed. obviously, portfolio Tac the extremely Obviously, a and seen

quarter physical overall beginning portfolio in strongest be good. reflects to The the that now, out would in was area it's spread equity quite the been. we're the broader into first What and revenue in portfolio see world. to digits, base, is things private And the ever broader starting double that So up than growth

company saw levels. it's So from than XXXX in record up Cosmopolitan well volume activity in business, infrastructure a more slots at the ever our [ph] [porch] our month

And on formation you logistics a our of stronger, now, don't the ever which the to in tell estate, it's that sort And starting the but up. some in ground seen you'll this bulk portfolio, in really so, job physical I the but And had quarters. fundamentals that's think spaces, in better. and represent not is the housing creation, household to yet begin housing been picking logistics pick numbers big of way, rental I with up would coming specifically, in in real world, of we've see rental

On starting up. just the are challenged, weak, to flip side, remains of course, pick office markets hotels remain retail

really well shift did still a just here that seeing strong it's sectors we're COVID. So in in from but those dispersed

sectors and starting momentum. to that have pick back two Now they're been up their on

a more had broad lagging feels they've U.S. base it as getting so, the And time vaccines out. Europe pretty now, slower

done But increase economic activity widespread better, think Asia this of as I starting businesses. vaccine revenues is across a be to they've terms and dam to see an it's really better you in burst job. and the most spread, in going

Operator

next Our Devin comes from the Securities. of Ryan question JMP line at

Devin Ryan

all more first what's increased SEC the the or SPAC with impact IPOs deployment clearly, in here we see just from go SPAC there Question we'll where maybe on activity. on quarter scrutiny. of But XXXX. than And, market are realization

be So there's a looking lot buy capital assets. going of to to

cycle some companies that's pushing also so, I'm whether for kind about you're in thinking and investing Thank of just the earlier SPAC, of SPAC degree outlet to with opportunities. be And you. an kind curious of about as competing into how thinking and you realization just

Jon Gray

realizations cash. you've our any the we SPACs, to led taking in we stack number But not about a have read it's sponsored on QX. So transactions of corporately a number for merging, back them And have private portfolio equity of shed. with stock done and

the they In we Many it are competitive out, larger dynamic, for us. to right, transactions, think are yes, to to get are and want go sellers SPACs certain works to in oftentimes, tend SPACs. focus some necessarily some on which to for terms growth I cash, providing of businesses who competition tougher But so many public XXX% want sell shelling companies universe. don't and want cases,

in history. of quarter, $XX we more in billion mostly seen there deploy ability capital. it out a third But haven't a quarter can U.S. We $XX put our with quarter. more overall, But put phenomenon which impede deployment competition. be our billion in was the out So to-date. way, the select the best that, our it's universe, little we By to

still there. going the we're are areas So be I IPOs in don't think finding SPAC like SPACs of to out they're feels months, coming fewer away. invest in. there It probably but

come. in the I think market of but alignment, disclosure, their maybe we'll you'll of terms terms some for I time in see see SPAC to maybe changes, changes some in think some

Operator

of next [indiscernible]. Our question line the from comes

Unidentified Analyst

big Most asked picture been have questions of the already.

as given So the comment and is to head in for maybe how CAGR tremendous a on maybe FRE AUM the you that? QX, mix FRE yourself, for I think outlook looking a the well? And then, question. And Thank margin tailwinds it's about wonder should you. if could sustainable how Michael, shift. line that item just we

Michael Chae

qualitatively the on momentum. that key think there, FRE four Stepping to or obviously back, aware drivers I most FRE of you're outlook, fundamental so our positive. Look it's

that First benefit on expansion vehicles, the we first from is strategies to quarter. of our existing in continue

talked Second, nicely are good to businesses, that. of scaling of contribute about examples innovation profitability we which as BXLS earlier, new to and beginning BXG, exceptional being

and know, we we'll $X expansion, about that know, point, than nature XX% you which you for capital, And level. transformational we're and your position, the those then, $X well, $X.XX LTM year We earnings into fourth, robust our second. a full as Third, all power XXXX a more so compounding earlier in as this in at expected above Day quarter assets. the Investor talk in year, year once margin perpetual achieved given target put a a of on potential bit that strong effect one out a XXXX,

to confident On looking one I quarter, as Bill, we say given we're you different So at of is a any that everyday bit, bunch the always factors. dynamics, continued described. just very from help quarter, in you margins, there's here, momentum first just a our know,

quarter had excess private is The the of year the new a growing equity, holidays positive well, number first factors, prior strong We revenues then, And had want we're mentioned. outlook, comparisons all rooting the sort expenses. in of in COVID fee in leverage operating on I focus the but for against effect over of ramping benefit, teeny to later we full a terms the year to of which more period. any in don't or quarter year. expecting reverse in And business one

the approximate If at this year of you that's look say for at margin, Bill. in rate that a vein, reasonable the reflection point. And run XX%, I'd LTM an approximately it's full

been hopefully, helpful. So that's

Operator

line the comes of from Gerry O'Hara question at next Our Jefferies.

Gerry O'Hara

draw think just actually, suppose perhaps the fee Michael, XQ? correctly, XQ? Can you some just next be might that that performance that anything And fee event would you what that can if those related about other not we Thank you. help quarters, sort funds kind suppose of would just you heard I those where of of performance in revenues? Maybe else significant revenues I should mindful the be us mentioned I off of -- dovetailing I us the remind think prior of question.

Michael Chae

all, stepping Gerry. I back. Sure, first think, Look, of

a view as timetable and derived these assets. scheduled from basis do without a paid contractual on revenues, having sell perpetual on revenue In these performance a we recurring high fee to terms very related stream, capital quality of it's

it's with fundamentally view aligned much to FRE. our So very

I think as both plus, you today, that's BREIT. is BPP the sort core know, of main component and

disclosure which the also that BPP investor vehicles. quarter, of the on think in year accrued you institutional sort of disclosed the in the receivables in the of the And are of track those third straightforward. It's then, year at And plus, forms crystallize in balance in our core anniversary there's modeling of separately release. year that as the course typically I portion year. the subscriptions. it's throughout sort the end And grows it of fourth XK, BREIT, happens actually the can net

saw while of area quarter contribution. in plus related in said, incentive is or There terms and amounts you'll terms It's second there'll areas on be quarterly when performance in it's each quarter. area, modest as also contributing So That the you based quarters, happening of fee you'll core firm see this ramp in when that and quarter the in other the credit revenue there, I BDC next third of a really, -- mode. fees. fourth the significant the and

as amounts, So those over we are well. to expect those time modest more grow but

are FRPR the key resemble that two is infrastructure structure. terms factors will also of BPP in its, those strategy So that a

single contributor back number a will and in continue plus But is scale right you step So of this of to basis sort being now products, strategies on terms that something over different core biggest a full of platforms. if the year time.

Operator

Autonomous Our next Patrick from question of comes the REITS. line at Davitt

Patrick Davitt

-- clients of partners your there's But maybe largest increase that managers? direction from even been really on the in to many view from skin I hasn't in compounding that more managers drive book or that tacking insurance players, demand alternative balance or so allocations shift, and and the the their answer evolution intensive So like game a having force value you change that any It of thinking could are capital business. concerned sheet there model. issue of largest to the insurance sounds earlier your kind the

Jon Gray

model significant it long come in a process, deliver. do they've in, are cap, flows at which for and the of us. the it's insurance. investment work. sit We But acquisitions, way, the enormous continues years, will we've as done, or to in have capital in And a we capital, And funds for context percentage minority something we of we We around it doesn't strategically. firms, time. today, or no these modest, prefer long model the the investments overall capital. with We net in customers, a us We've billion people historically, is won't right our them. did that respect we chosen as But QX, have different and are, we on think terrific the have other of firms there And model, a where to capital we talent XX Ad as put No. rely use we invest worked. been this to debt. to but And over capital require for more has the manage. that what now market $XXX we strategic virtually and big some to like that deliver won't the again, QX, size mean

it. And It also shareholders. model. pay to so out significant our good stick with to we're We obviously really going allows that dollars about us feel to

Operator

question line the our UBS. from next And of Beatty Adam comes at

Adam Beatty

saw I where office. fruitful recently domestically. estate estate. real it's already Obviously, a want in I something in getting opportunity Blackstone on the up global specifically, real warehouse in follow strong in runway, growth involved about been potentially to here you're logistics, And India development

the that be might across repeatable to you're So where you. and opportunities. to globe how from want a get of sense as seeing Thank you

Jon Gray

demand in is Europe number, It's which on for mile retail numbers. don't warehouse a and United half being $XXX that super over have think the it exact dead to portfolio, warehouses, States. I But outside is everywhere, We're the about same close is moves there's billion chunk huge story warehouses. particularly I fundamentals, repeatable assets. it's the is in growing done our the including Probably more of last the as Asia, online, of increasingly which growth, scale. it's

been other We like graph our buyer Europe. then we've platform in a China. everywhere. so, of lot Asia We're just And And was housing, supply. fundamentals biggest and challenge or in The the sold more we a is, that reopens, think help. we see economy see concern But where active demand closed as we'll the in the fund. in Australia traditional that'll I new automotive, businesses,

And this so focus we on continue mile. to last

if you allocated to estate like, we the forward and sector we confidence is about have in space think estate because our real portfolio we're best why globally. real a looking it's XX% So

U.S. They're fundamentals. China, behind little those they're And behind, up. the but is I a playing online you'll so catch bit other see same than because think

in And on the ground so is those being important. really markets all

Operator

of our at And Oppenheimer comes and the Company. from Kotowski line Chris question final

Chris Kotowski

built, minutes of kinds I that assess crystallize core see three on happened going just had more that a highlighted wanted real how of that of of wondering, third those release, to the the funds? discussion more And logic the fees just that start portfolio press of I'm the core ago. you sporadic of follow And go you as on forward? plus is I the every couple in there mean, in the estate years. of a up you -- is those And things to of basis performance assets we'll is all sprinkled that? we kind a the on and do through coming anniversary year size as crystallization

Jon Gray

Well, I yes. short answer would the say is,

variety. a have We

logistics here U.S., well. Life in individual and one core as open Asia. we large as Town Stuyvesant European themselves, We large Europe ended York BPP have vehicles, institutional We BPP own of funds transactions did now Sciences, logic platforms, some New And them.

said. in Michael the at and times, in investors so funds the then And as come different

So done a hopefully, of these deals over time, be lot of year got at a there'll more end. spreading

something should time, something happening these this the quarter, is base But core amounts, basis. a only hear our BREIT lot in more greater a more more from is And fourth you been have different we've related in special fees is be quarter. times happening but and growing. there fourth they year. special of plus to in yes, come regular tend the business up enthusiasm, is core the management net and we is lot and in perennials a the why plus, planning Blackstone, extremely And performance fees and on this set in not of at blooming very at is So of should these right, you're over

Chris Kotowski

see or the performance Okay. carried the And see we we fees just performance interest? from on that separate as up, -- page do is in a disclosure these on follow XX fee accrued do

Michael Chae

If for you both see BPP and them, for broken it you separately. BREIT see do out

Operator

Western to to for like hand And final I'd now, back Tucker comments.

Weston Tucker

look Great. following this morning Thanks to call. everyone for after joining us and up forward the

Blackstone (BX) 22 Apr 212021 Q1 Earnings call transcript