Blackstone's BREIT raised $1.3 billion last quarter while rivals sold shares privately

Blackstone raised $1.3 billion for its non-traded REIT, BREIT, in the third quarter, according to the firm’s Oct. 22 earnings release, and BREIT reported $57.7 billion of net asset value on Sept. 30 ^[5][12]. Blackstone says BREIT has returned 9% a year net since it launched in January 2017 ^[12].

Four smaller non-traded REITs that also sell to the public through brokers amended Form Ds for private sales between Oct. 16 and Oct. 28 ^[11]. J.P. Morgan Real Estate Income Trust, whose filing lists Chad Tredway as an executive officer and director, reports $301.1 million sold privately to 115 investors since June 2022 ^[1]. Its second public offering, open since Feb. 4, had raised about $98.7 million in the primary offering ^[2].

Most of Cohen & Steers’ NAV sits outside its public offering

Cohen & Steers, whose Form D lists Robert H. Steers as a director and James S. Corl as an executive officer, has five share classes, led by Class P at $299.6 million, that are “not sold as a part of our public offering” ^[3][4]. By our math they hold $350.7 million, or 90% of NAV, while its public offering has sold $21.6 million since Jan. 30 ^[3].

Its private Form D reports $15.64 million from 108 investors, with Rockefeller Financial named as the seller and $55,350 in estimated commissions ^[4].

BREIT also raises through 1031 trusts and offshore feeders

Next to the $2.3 billion of primary proceeds in its current public offering, BREIT reported $265.2 million raised through its DST program ^[5]. It sold $21.6 million of Class S-2 shares in an unregistered sale on Oct. 1, and $10.3 million of Class C shares to feeder vehicles for non-U.S. investors in September and October ^[6][7]. Blackstone’s quarterly results are covered in our Blackstone story.

Feeders also file their own Form Ds. iCapital-Fortress Net Lease REIT Offshore Access Fund reports $59.67 million from 34 investors, and an iCapital feeder for HPS Net Lease Income REIT filed in October with no sales yet ^[11].

The SEC’s Sept. 30 proposals would also let interval funds schedule repurchases to better match portfolio liquidity ^[10].

How to use this

For investors in non-traded REITs

1. Ask which share class you are buying and what its NAV is, because classes differ. J.P. Morgan’s Class I was $10.61 on Sept. 30 and its Class E was $11.56 ^[2].
2. Compare a REIT’s new public money with its size before you count on easy redemptions. We calculate Invesco’s current offering has raised primary proceeds equal to 4.7% of its $669.0 million NAV ^[9], and the September supplements we read gave repurchase prices but no repurchase totals ^[3][9].
3. Ask a feeder fund for its own fee schedule on top of the REIT’s. iCapital-Fortress reports $59.67 million from 34 investors ^[11], and a Form D does not show what a feeder charges.

For advisers and wealth managers

1. Read each REIT’s Form D next to its NAV supplement. J.P. Morgan’s private offering shows $298.9 million still unsold under a $600 million cap ^[1], which leaves room to keep raising privately.
2. Check who is paid on the private side. Cohen & Steers names Rockefeller Financial and estimates $55,350 in commissions ^[4], which we calculate at about 0.35% of what it has sold.
3. Track the monthly supplements on a calendar. The September NAVs were filed between Oct. 13 and Oct. 22 ^{[2][3][5][8][9]}.