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Blackstone expands into US rental housing

Blackstone Private Equity, the largest owner of commercial real estate in the world, is expanding its portfolio into rental housing and commercial real estate in the United States.

The company announced on Wednesday that it will spend about $6 billion to acquire Priority Apartment Communities, an Atlanta-based real estate investment trust that owns 44 multi-family communities. and about 12,000 housing units in the Southeast, mainly in Atlanta; Nashville; Charlotte, NC; and the Florida cities of Jacksonville, Orlando and Tampa. Preferred also owns some retail and office real estate.

Preferred apartments for rent account for about 70% of the value of the deal, which is expected to close in the second quarter of this year.

The proposed acquisition is the latest sign of Blackstone’s ambitions in the real estate sector. Blackstone chairman and chief executive officer, Stephen A. Schwarzman, and chairman and chief executive officer, Jonathan Gray, said during an earnings call in late January.

The executives added that rents in the United States have increased at a rate of 2-3 times inflation. Consumer prices up 7.5% in the year to January, the latest government report shows, with rent costs expected to rise this year, further promote inflation.

Real estate has become an increasingly important part of Blackstone’s operations. The company generated nearly half of its income in 2021 from real estate in what Mr Schwarzman said was “the most remarkable result in our history by almost any metric.”

Blackstone’s stock has fallen sharply recently. Its shares have risen about 80% in the past 12 months.

https://www.nytimes.com/2022/02/16/business/blackstone-real-estate-acquisition.html Blackstone expands into US rental housing

Fry Electronics Team

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