Blackstone sees highest quarter for private wealth inflows

The alts giant recorded $8bn of capital from private wealth, including $2.7bn for its private equity strategy targeting individual investors.

Blackstone has amassed $8 billion across strategies from its wealthy clients in the first three months of the year, marking its best quarter for fundraising from the channel.

About one-third of wealth inflows ($2.7 billion) stemmed from Blackstone Private Equity Strategies (BXPE), the firm’s private equity-focused vehicle for individual investors, according to the firm’s first-quarter earnings materials.

“Subscriptions for the perpetuals increased 83 percent from Q4 and marked the best quarter of fundraising from individuals in nearly two years,” president and COO Jonathan Gray said on the earnings call on Thursday. “B-CRED led the way, raising $2.9 billion. BXPE has received very strong investor reception, raising $2.7 billion in its debut quarter. And we plan to expand to more distributors over the coming months.”

Gray noted that demand for Blackstone’s wealth offering has been “pretty broad based,” with a strong presence in the US.

He added: “We are seeing strength overseas as well. Japan is a market where we certainly have seen more openness to our products, and we’ve had success there. Historically, some of the markets more tied to China, Hong Kong, Singapore, are a little slower today, but we’ve had strength in those markets over time, also. And Europe, I’d say, is an emerging market, as is Canada.”

When designing BXPE, the firm’s aim was to make the platform as broad and scalable as possible, Gray said in response to an analyst question. This means all of Blackstone’s private equity strategies – corporate PE, tactical opportunities, hybrid equity, life sciences, growth equity, secondaries and more – are part of the platform, which enables the firm to deploy a lot of capital, he noted.

Individual investors will tap direct investments, secondaries investments and fund commitments made primarily under corporate private equity, growth equity, opportunistic investing – such as tactical opportunities – and secondaries, according to BXPE’s annual report.

BXPE’s new leadership

Following the close of the first quarter, BXPE underwent a leadership change: in a Form 8-K filing made this month, Viral Patel was named CEO of the fund, effective April 8. The filing added that co-president Todd Hirsch had resigned.

Patel joined Blackstone in 2005 from Credit Suisse’s structured products business. He played a role in the launch of Blackstone’s tactical opportunities platform, as well as several others. Prior to assuming the leadership of BXPE, he was global head of technology investing for Blackstone Credit.

Chris James, COO of Blackstone Tactical Opportunities, is chairperson of BXPE.

Q1 private equity fundraising

Blackstone collected $34 billion of new capital across strategies in the first quarter, driven by its private wealth and private credit offerings, and deployed $24.5 billion.

For private equity, inflows reached $7.4 billion, including $1.4 billion for the firm’s ninth flagship private equity fund and $1.7 billion in infrastructure. Invested capital in the quarter reached $7.3 billion, while realizations stood on $5.2 billion, according to earnings materials. That compares with $3.6 billion and $8.6 billion, respectively, over the same period last year.

The firm has collected $19.2 billion thus far for Blackstone Capital Partners IX, up from $17.9 billion as of year-end 2023. Blackstone projects a final total “in the low-$20 billion range,” Gray said last year.

Blackstone has $200 billion of dry powder available to invest as of quarter-end.