The Blackstone Group is going against those predicting dire consequences for the commercial real estate market by raising an additional 10.9 billion dollars for their Real Estate Partners VI fund. The company sees a number of potential bargains on the horizon as the market retracts from its highs in 2006–2007.
Blackstone said it had raised a total of nine real estate funds with total capital commitments of $25.7 billion. The fund it just closed is called Blackstone Real Estate Partners VI.
Previous real estate investments Blackstone has made include Equity Office Properties (EOP) and Hilton Hotels Corp.
“Between raising or investing, raising is by far the more difficult task,” said Michael Holland, chairman of private investment firm Holland & Co and a former partner at Blackstone. He said investors in the fund would have been attracted to Blackstone’s track record. “They would be taking into account huge sales they’ve made — such as EOP. Those look right now to be reasonably brilliant.” via Reuters.
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Commercial real estate is definitely not dead. Real estate is all local. I am still able to find money making deals and am writing about them in my blog at http://www.myactualprofits.com/wordpress. People have to remember – no one gives away money. You have to work for it. Sometimes you just have to work a little harder.
Like all real estate investments, commercial real estate has its cycles. Right now, the credit crunch for some investors who financed acquisitions through risky bridge loans and short term financing is forcing them to sell as refinancing is unavailable. Blackstones deep pockets allows them to purchase with equity, ride out the credit crunch, then finance later when debt is more available. Trickle down economics dictates that small business owners should be able to find some affordable office space, retail space or industrial space for their companies now. On our site, http://blog.mysquarefeet.com, we help small business owners learn how to navigate the complex world of commercial real estate. Learn how to find, lease and live in commercial real estate on mysquarefeet.com.