- Total assets under management up 26 pct to $265.8 bln
- Q4 ENI up 130 percent to $1.54 billion
- Q4 distributable earnings up 46 pct to $820.6 million
The property business of Blackstone, the world’s largest alternative asset manager, got a lift from the initial public offerings of Hilton Worldwide Holdings Inc, Extended Stay America Inc and Brixmor Property Group Inc.
Profit also soared in Blackstone’s private equity and hedge fund units as the value of its assets rose amid red-hot capital markets and the firm cashed out on many of its investments.
Blackstone said economic net income (ENI) – a metric of its profitability that takes into account the mark-to-market valuation of its portfolio – was $1.54 billion in the fourth quarter of 2013, more than double the $670 million of a year ago.
This translated into ENI per unit of $1.35 per share, beating even the most optimistic estimate of $1.30 per share of analysts polled by Thomson Reuters. The average estimate in the poll was 83 cents a share.
Blackstone shares were up 6.7 percent in early trading at $32.99.
ENI in real estate surged 279 percent year-on-year in the fourth quarter, private equity was up 82 percent and hedge fund solutions were up 63 percent. Its credit business, impeded by an environment of low interest rates, bucked the trend to fall 2 percent.
The value of Blackstone’s private equity funds rose 11.5 percent in the quarter, while the value of its real estate funds appreciated 13.1 percent.
Distributable earnings, which show actual cash that is available to pay dividends, jumped 46 percent in the fourth quarter to $820.6 million.
Blackstone, whose investments also include SeaWorld Entertainment Inc and Pinnacle Foods Inc, said it had a record $46.8 billion as available capital for investments as of the end of December. This included of $17.7 billion in available capital for investments in private equity and $17.1 billion in real estate.
Total assets under management were $265.8 billion as of the end of December, up 26 percent year-on-year. Fee-earning assets under management rose 18 percent to $198 billion.
Blackstone said it had raised $3.2 billion by the end of December for its first Asian real estate fund, which has a $5 billion fundraising limit, and $5.6 billion for its fourth European real estate fund, which has a $6.9 billion fundraising limit.
It said that “tactical opportunities,” a strategy it launched two years ago to invest across alternative asset classes that are usually not a target for Blackstone’s other units, had raised $5.1 billion thus far.
Blackstone declared a quarterly distribution of 58 cents per common unit.
Greg Roumeliotis is a reporter for Reuters News in New York