Blackstone (BX) 20 Oct 222022 Q3 Earnings call transcript

Good day, everyone, and welcome to the Blackstone Third Quarter 2022 Investor Call hosted by Weston Tucker, Head of Shareholder Relations. My name is Ben, and I'm your Event Manager.

During the presentation, your lines will remain on listen-only. [Operator Instructions] I'd like to advise all parties that this conference is being recorded for replay purposes. [Operator Instructions] And now I would like to hand it over to your host. yours. is floor the Weston,

Great. Thanks, Blackstone's and to morning, and quarter conference good third everyone, call. welcome Ben,

Joining today our Chief are President Steve which a Schwarzman, Chairman and slide and Operating this we presentation, and press Earlier release and available CEO; Officer; Michael Officer. Chae, on Financial are morning, issued website. Chief Jon Gray,

of may not weeks. the materially. uncertain remind you to We file XX-Q our like may are and expect control We duty which report today's firm's I'd update include call differ to and results statements, these statements. outside in undertake a few actual to forward-looking that from any do

With per I'll common to a material the were paid XXst. see over reconciliations common Blackstone as in find measures, the turn share, on be dividend $X.XX is the a copyrighted of and call net the of section solicitation and press for release duplicated Distributable we XX-K. Factors per we reported of On which or that, audiocast on in an purchase and For GAAP nothing income be Steve. share, could website. record to may October quarter declared of shareholders will refer affect million. sell our or of our to interest $X risks without $X.XX $X.X This billion to of the consent. Blackstone some of non-GAAP the Risk earnings call not holders results, results, note to please of Also, of that you'll please of page discussion any constitutes also that offer fund. offer an this We'll an

you morning call. our you, thank and Good for Thank joining Weston.

dramatic bonds quarter XXXX a nine XXX in markets, of the for year. fell to declined year-to-date the to The S&P index was the The sell-off months of the difficult the and characterize The falling in XX% Global NASDAQ was decades. one public quarter high-yield bringing just to year. down another XX% REIT periods of XX%. markets first in the of year-to-date. and XX% continuation extended XX% decline debt third XX% half The the markets in most a And year-to-date. of X%, high-grade first

combat Fed's interest geopolitical and have in over its down created areas is inflation, a slowing for traditional with is year-over-year year-to-date, on environment quarter excellent nearly representing $X.XX economy, or for portfolio challenging the to quarter and given $X.X as Against Our likely extremely increasing our record. to sentiment strong performance interest combined third billion, rose earnings shareholders. generated difficult We to Blackstone rates navigate. highly worst all of to years XX to remain commitment inflation. rising turmoil, $X.X backdrop, in ongoing an this distributable delivered our share, Weston second billion, earnings investors rates XX:XX continue results noted. XX% XX% a for almost The the Fee-related negative, best

continued managers money grow. AUM, have most markets to we've declining focusing While liquid seen on

across products year-over-year increased strong our insurance Our wealth channels. to assets billion, a $XXX demand institutional the management with XX% record for private under and

our first through their Key customers grows. fourth billion which consolidator, of major annuity and approximately $XX we remarkable the insurance protected expect market we comprise Blackstone leading a week, billion capital that their $XX partnership to last in and Life, platform Just life have year the our Resolution as time with these we over over block announced to space declines. is in AUM with success

excellent job principles, of core the since firm done of avoid to is in One money, we and we've founded XXXX, losing clients' that. our our an

of well risk. approach companies This anticipate areas great have advantage firm in alternatives across to carefully what believe, trends data our help and to the global business allowing choose world, We platforms. is distinctly the diverse and unique minimize in to to of to we economy, which most determine today. happening use on us buy sectors then and has as access led and positioning We this build and largest area. the we As work liquid to synergistic securities type strong assets focus actively and in the insights

companies highly And found so real companies corporate the BPS is real in of our third in housing, have benefit economy corporate floating For in credit, revenue, year-to-date in Blackstone's led experiencing achieve above XX% quarter, estate, life long inflation, defaults. S&P. example, XX% securities This hotels. our year-over-year growth size a and to are distinctive Stanley in why grow constituents. outcome Stanley far well the investing Blackstone. In in across the office asset their on revenue areas employs of here growth Blackstone. doubling approximately five to a and years. This all to sectors such protection total, in the estate potential We is, of we alternative remarkably of a allocations achieving decade occupies our rate difficult approximately That's allocations capital logistics, quarter history holdings. a rate returns areas customers XX% than largest to liquid critically a And third are important it among LPs private to channel Morgan are operating significant of in so. our is special our result, uncertainties is our portfolio worth and with of differentiated represents in positioned growth All is as emphasis private alternatives detail. to to rents performing decline from more solutions science do XX% credit Blackstone investors, XXX,XXX fund years They the navigate rental of in investors these around alternatives, given From the and and Morgan growing managers. with to of private in will our over market real infrastructure, opportunity we're at the This inflation in individual hedge traditional of quarter people. has XX% more faster-growing next In markets their resulted to business which, over particular, in leader that Blackstone share us is competence growth where them equity, negligible XXXX. and the of equity course, shared in we outperformance the over from to help paradigm world. They positive portfolios. the to the and ago status around as slowing are At the identified dollars choosing challenges. the compared customers major LPs Jon increase our as to world. business and by we travel exposure with greatest yield when stunning their leisure-related classes including and high the with portfolio discuss among every to composite net close XXX% five trillions in predicts X% research annually and a clear in today channel facing alone. a we world seek change Recent protection. from and looking will which by private estate are investors perspective, AUM objectives uniquely the is in estimates this believe XX%

firm to had in we We that the prospered deploy and years pullbacks we've started. business And XX serve are many to remain assets we new advantage proud closing, mission AUM. lines of initiatives closing our across In of significant in capital our in since cycles in people. extend in us across prices, We invest our Historically, past on today, of as place taken leadership them. then. as we're has our the and the $X steadfast well at they attractive trust trillion of the no position

For extraordinary growth, intention our we into of slowing shareholders, this have has and no down. translated

potential. penetrating resources We markets our the highest confidence, Even channels expand, firm's have power in new the to the the is continues enormous of and our concentrated climate early loyalty in earnings. and The earnings people. the though are challenging, customers we the quality and investment innings of with

benefit all the our to Jon. We franchise turn to constituencies. of over continue And of it that, with our develop I'll for

Thank you, morning, Steve. everyone. Good

and delivering exception. customers no or business for is was shine quarter third all about Our our the rain in

estate we Our the of investment along investing, expanding have results with model we serve who at drawdown as of completed in periods. and have strong two Meanwhile, our investment toward even the progressing billion our avenues global half can front the update to our launched the times. three the target more demonstrated than of We've our the firm's and of LPs, real their for thematic private Steve you of we we highlighted. most where us. this our benefits durability difficult invest of our performance with secondaries support Starting growth flagships, largest point. fund business, have with the continue on equity of are again $XXX multiple allowed largely us and fundraise achieved in with I'll respective

and $X $XX focused prior the the quarter credit, and to equity billion reported we where in to fund. be energy. closed corporate In has equity private private tailwinds transition kind. private Our as a energy equity, to-date, its expect we for largest the reach see our least expect strategy $X is where and large the tactical secular it and $X at vehicle believe target tremendous growth an in we billion inflows We new opportunities credit billion as flagship of to area we've on in billion raised of on the quarters. This coming and renewables additional

diversity platform, headwind the global in overall, our brand. While a environment the of the will reach are given market we our for industry of remain and a position power differentiated the

Turning Wealth. to Private

is in XXX vehicles. and offer past powerful. in our are months AUM up including works has In partners transforming long-term XX% manage has limited in quarter, $X.X that and totaled One the for repurchases We billion the also billion. This to third the Blackstone trends Private investors now of our mega do XX distribution finally development response sales a them. the Wealth been totaled been perpetual that and billion $X.X the individual this led channel getting billion, alternatives $X which alone. by in form access landscape for market structure perpetuals, We of the

comprised benefit BREIT performing portfolio leases as in portfolio a index. best discussed inception interest has net years rate a Nearly floating As performance the XX% generated X% net inception penetrated and we impacts this of and these outpacing inflation. vehicles. of public outstanding housing, BCRED ago an some annual net of rental Xx That quarter, have with positioning. duration products six logistics is market or higher. is per meaningfully flows is market returns and since move the sectors short rents with and BREITs rates return since and REIT our year returns and said, last vast stock under XX% volatility

we this launch in forward, the penetration and add existing with to plan more relationships deep Looking partners products new in around channel, world.

and Moving our to XX% over Institutional up including XX estate is platform billion Perpetual institutional real which $XXX Core+ business, infrastructure. our across vehicles, year-over-year,

Infrastructure to benefit the great in Our nearly business drive doubled on sectors focus appreciation $XX performance. date. to strong helping back of the Both assets on excellent quarter from in platforms year with fundamentals their continue positive hard to year-over-year and billion

Turning to insurance.

doubled clients company from insurance Over annuity which now an $XXX we has large We’ve more alone, billion. our multiple strategy is AUM insurance clients serve XX the greatly liabilities. and basis. one of than or Life, which noted, sales. dollar an AUM in an annuity Our on past billion months with servicing becoming tailwind example investment fourth added the life closed leading have added another to on of $XXX global existing over the from time, without for scale ourselves block as This Resolution expect accelerated of consolidators a Steve of as mandate a taking several manager is market multi-trillion to

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in engines worst billion together date. We trusts the strength excited positioned dry which third year discussed. as confidence period our despite with speak to $XXX markets declines on the advantage inflows of record, are take the of to in powder the could to us. and long-term have dislocations. some drove our total we experienced diverse brand a the capital, challenges more we place $XX And growth of range potential. record of not than navigate record results ahead. investment billion $XXX many the Steve quite quarter in about billion I A our well people. anything to and of Taking ability firm today’s have These closing, road a our are and more In clients the our the environment, in of of

buybacks. past the capital share years to model, continue growth, allowing we light return us dividends shareholders, our For through significant of to true and remaining over our to XXX% achieve five earnings while

And delivering to things that, We are on focused our all will I of Michael. turn totally stakeholders. with for over

everyone. and platform, At in through Jon, same step detail. fundraising we in up Starting history, is of business to results time, cycle FRE. provide quarter advancing morning, our with markets. each The are firm’s I’ll coupled difficult model setting expanding these highlighted third good designed Perpetual with the in in which Strategies a Thanks, results. areas the the for resiliency Capital more foundation material largest discuss our

along expansion. to the across powered a as significant year-to-date million those our XXX in to the At the two. XX% robust In margin breadth powerful $X.X with per our period margin strategies from for scaling financial led and the the performance of fee-related growth to revenues. XX% in strategies management expansive continued is basis declined billion margin XX% to firm’s revenues, same with respect growth One the our engines of fee record fees as market with sequentially We or comparable time, nearly $XXX the months year-over-year, increased year-over-year quarter, earnings. of to FRE be XXXX $X.X of best area the strong environment in same this in billion, With perpetual now The up margins. continued billion lifted full X% investment above FRE. is combined of quarter performance tracking FRE XX% the durability from trajectory third in share, the $X.XX third were Distributable by illustrations model Net activity revenues. and expect With $X.X the expected. points nine underpinned expectation. to year year-over-year earnings XXXX. year realizations fee-related of respect to expanded period, XX.X% momentum quarter, line by prior levels previous unit of

While to term. the near in is likely remain backdrop the favorable for less exits

One the revenues on performance primarily value executing the Performance is the Net can ago. for waiting AUM operating a billion build. of nearly to long-term $X grew years on the few model accrued the per modernization. focus in for its our record over creating but opportunities due our identify revenue performance potential or of double key to to continues we that activity, the plans optimal and share, firm’s the eligible patiently realization attributes billion. still meantime, past In stand at record $X.X of ground down level quarters, two balance XX% $XXX the to year-over-year sheet revenue

Moving to investment performance.

stronger translation returns. estate, approximately saw non-U.S. additional holdings negative of In largely related and markets, and on to These BAM depreciation noted of credit included for backdrop to in estate, X%. observations investor against our stable, capital, impact our Steve appreciated global opportunistic private dollar. quarter. continued and real equity credit Core+ real corporate the the Few values were protected op modest X% the funds and U.S. our equity in returns As pressure tac X% the currency of

portfolio private to been today. unaffected values. with to comps a at equity, have true in outcomes, which meaningful valuation at of First, have of carrying continues multiples, terms historically our discount premium compared held companies In significant be in occurred terms that public in exits a alignment to

year-to-date Second, and real still of Notwithstanding rates, this cap has growth in rate increased cap more across wider assumptions of estate rates. offset our materially cash strong the the the rising real appreciation context than in as interest flow impact strategies seen have portfolio. dividends we’ve impact, estate,

toward the the more progression Turning outlook, by continuing to recurring firm’s which higher is characterized earnings. and

expect strategies, drawdown As with of we combination we perpetual over cycle the quarter, contribution the up lead the last our the a along highlighted FRE years. for step structural several next fundraising growing to in

In estate four-month an holiday real terms for August in with of we effective funds, period global the launched the the fee first for closers. investment drawdown flagship

perpetual We depending layering that particular more $XX previously in revenues, time, setting with has we AUM continued billion fee a will subject increasing noted this same than baseline total, performance the to wealth times BPP fee-related crystallization to revenues strategies, value since XXXX respect higher the billion on the AUM, $XX deployment. in compound funds forward. private launch start four and other vehicles XXXX. earning discussed perpetual At the With of effective over going fee have in to time for in and in year

described, in years these completed highlighting of This their standalone month, the has the for high represented which FRE. to we for ongoing despite of in and One it’s extremely to nor and our are seller of Jon driver come. fee-related of Corebridge, Overall, backdrop. a client as important well offering, the for the capital IPO, dual Blackstone was evolution borrowers an drawdown our Corebridge a our milestone is item exceptionally the difficult As business the and successfully being in not worth BCRED was final insurance company. note. its markets cycle multi-year degree shareholders Last positioned, public committed perpetualization outlook catalyst vehicles interest specifically, fundraising investment a performance of give income, that paying us visibility. confidence revenues remain

deliver key in is manager value partnership for on asset forward an company, the future foundation rates for and and to saying growth. base them and for very pleased as powerful look their the continuing a spreads. success for date a model stress protects our us the widening expected to increasing excellent position benefits the the investment of been have times our including firm in with positive We classes. from In to view exclusive closing, of of We’ve all-weather provides

call open great to and have in you years the that, in questions. the firm up will joining We achieve thank confidence now ahead. like With we for would the what for it

with to our Instructions] would Siegenthaler [Operator which question, Craig that, proceed first you. coming of like you. Bank Thank go Thank Craig, to from ahead. I And is from please America.

good morning, everyone’s Hey, Jon, doing hope Steve, well.

Morning, Craig.

My front results really question backdrop strong equity this strength is some Blackstone’s ability U.S. haven’t and fundraising. we plans, year Blackstone’s on the seems more us the yet grow seen on it fundraising headwinds provide this the bear although market denominator extends sovereign fundraising with again an impact private overall Can quarter. funds. been with probably you wealth effect, There’s crowded next into with organically if to weakness But and update last year? multiple pension from

as bonds pretty best And XX% equities reflects, what than environment which our to is remarkable. So, were an is where continue quarter our like traditional new what XX% for then and doing our grow with we’re billion record continuing and income, into mean, in the obviously, our I customers, equity delivering businesses. it in first the indirect months, billion quarter, and we of $XXX into the these well breadth today, sciences higher Core+ in fixed starting original power alternative when grow long-term think in nine the in estate, months. lending, move of previous spaces our new nine we Craig, life raised it’s the brand, and the I I first worth down business drawdown is think areas to expansion of $XX insurance, track that course, XX% fact real our growth down

unlike capital all other successful all our new money performance. specific channels. it’s and world on are and the backbone benefit And the strong so these think as in we’ve of of around regions not then performance question, exploiting managers, also some sort out growing but what got platform I a geographically, are to that capital U.S., Investors And you led constrained. see of raising more that is then of I has other built acknowledge there. constrained. your To would And the harder the

best tougher when bit saying be But that to will will think but be us, this better, the want until they got you many raise denominator say may area. by constrained I They’ve about a a a hear tougher, markets continue and differentiated don’t we’ve be it been overall, They our we sit. effect for customers, I want feel to for to performing And their get to lot so very their would groups alternatives. favorable view. It’s at got you spot, today, this. tougher. bit talk reduce then but good to a allocation they where capital we

balance trust make time they that you after countries where gives the terrific bond – mentioned think decide our in we first you I the the more Jon and been And those just so relationships to the less is so when add because I non-U.S. because the from for that fund our are you foreign just when mentioned, global of then starting There’s outside personal a have. enduring from have a very and investors. of time. factors you certain deliver Steve, that be tend raise and significant us And from directed flows, to made can we a they want fact coming And after are as component cultures, that we of to the at foreign that significant pension United long go a time in States. XXXX, people favorable, type funds, and money. U.S. time commitments

on operator’s instructions. Thank the question, just the if move next we before then, could you. I to And clarify

make I queue long get We have everyone. we to would and sure to want a

come one I everyone make get could first to the question, this please back just question, morning. sure into to So to up have the we if if we limit you want queue. follow a

Perfect, you. thank

coming is Barclays. proceed. Ben question from from Budish Please next Our

kind more so you your much about to that I the some gave morning Thanks of Jon, the underlying wanted portfolio ask for guys. question. know for taking outlook companies. I this Hi, commentary you there’s towards which bit caution of travel remarks there’s that a guys more discretionary. in a and the of bit a bit kind and mentioned prepared leisure little a skew are

comment performance you how the next six see to So there on, months? over maybe XX can you

So as strong. I said, in been strong. what’s expected. than India very U.S. better has Places is remarkable the economy particular held up Europe has like are people

point data we a also saw revenue XX% it growth a think fact that I selection. here, something our in lot of As sector the pretty strength private there’s reflects equity says still portfolio that profound that and

the So bodes so for done well fact in us. that we’ve much travel, in equity, private leisure

quite Our assets doing energy well. all energy infrastructure, transition are

we’re the and slowing that’s X% we a what anticipating Overall, inevitable. to think that’s as we’ll what our just It’s comment, I helped widening. a cost estate we’re big in happen market, that and companies. strong from logistics positioning we time. Michael you lead us do focused to think in similar capital with debt. real more and X% here. for your the housing, When commented and a it’s see where ourselves back then growth. hotels, way us has the such that’s going areas think in all start slowdown paying on less to about caution, positioned take rental down debt widens There’s more and even And to to telling on spreads expansion. People with They’re capital of their over will de-leveraging,

it to about companies of that think is. in think need I that’s something how So all terms severe

much leverage have then were I same on kind comment in back as hard in estate, XXXX, think We in better say. real housing, global I a XXXX. banking to don’t back had it’s in What spot in the than is a over we commercial of we’re we would economy institutions.

thinking makes should there been that obviously, no coming you a stock slowing question feel that We anticipate is that. about here. the better, market and So there’s but has

Okay, great. Thanks my much taking question. so for

The comes from Stanley. question Michael, please Morgan from Michael proceed. following Cyprys

about Wanted the Europe. some and the moves Thanks seen good taking interest UK ask question. sharp We’ve rates for and Hey, and morning. currency very there. to

trophy the opportunities how time of work. there seen in that Europe, assets. UK buying putting or implement some set for for also sellers companies for capital strategies to It’s curious So just you the see LDI now or the evolving funds become properties and

So just what sort seeing that opportunities you’re curious you. what you? that of might Thank on for and front offer

real UK raise are inflation in challenges energy to the their Thanks, the There not which driven by States. challenge the term. and near in much maintain Michael. inflation. Obviously, have is Their central we than some United pronounced face challenges, currencies to have more need order the and rates their in Europe banks what further

their rates, usage In I many date, floating is rate efficiency, are tend addition, the rate XX-year higher our on energy mortgages things and challenging have European adapting and performed as held up they the puts Companies expect. raise it pressure be fixed but economies. markets, their better and housing our companies have going a prices of them better period. would to say than to which versus have would you model, additional to to

have against much much moved that investors, and down. the as think is what overlay I you valuations have the currencies how have moved just to how

You’ve nine you XX% the in particular, nearly Europe seen and movements the stock at market, look in times here trading there’s UK and of UK currency earnings. it the below

So we There’s gone trends be we could the are and assets enthusiasm’s and look around wow, at interesting and the and continental bunch travel, investor of that UK yet down. say, A around infrastructure technology, prices could attractive be still places. in like Europe these thematic logistics.

makes entry that attractive to us, an point. so And for

back of be up know, as to abated in participated rates have seems time CLO move selling, particular there that. aren’t the four quickly back I years. say grows wouldn’t of think manifest in really to in when for next make some others happened it things It to at as there as Sometimes XXXX, themselves, investors. surprised the the take are you billion of but opportunity capital of back the to I to other in system. there powder, it to this dislocation. to It XXXX. would on behalf $XXX dry few on we point, We we’ll our the Brexit, takes quickly periods but Europe pressure was We LDI ability over these model, be in busy decisions sellers try And paper. happened deploy question like in then our that move

you challenges cognizant the given but there. of in the the opportunities So I underway open think to to repricing be economic that’s minded have Europe,

Great. Thank you.

The please from go comes question Brian, Bedell ahead. Deutsche from following Brian Bank.

mentioned, strategy. Great. come to transition, more bake demand to any Maybe investment impact all investment green traditional? private this general processes folks. credit you energy of bit And or ESG in considerations seeing set? opportunity wanted in just the terms in across I Thanks. strategy from energy on all you little are that you is the guess expand the a investments, Good transition energy desire that maybe And talk morning, but product across platform Jon, successful then that really the touch of I is what dedicated the know about verticals? the retail more across a this raising more

this for What this would I Brian. say area us that to underway. is is transition energy enormous about you, credit Thank providing is

it’s of lend back liquid which order to necessarily will of financing To been lower of the spent in XX% trillions we’ve you U.S. as finished very a of require space. think move to to the projects, think targets. to a if developers to in debt. going to investors form zero net if the low Europe a projects, from us their of hit will bit that not you in to number, providers dependency if We pay, on the doing the accept lot some require be for us of lot little hydrocarbons lower successfully about most service need in It’s dollars So a you equity. going financing is

our United lend the capital been you need for reasons in If we’ve consumers. enormous providing about so way very think six is a about capital. for for well large to financing They're say, excited ESG we're being the We because a good the and to to focused Invenergy, on consumers, lot. a for and I our this is to there's because ago active and the in need in of doing customers. area. investment us been wind also as similar excited which months go solar in And talked – fiduciary driver market the equity a this we're projects we've a relates about as energy is infrastructure, of We our an area it largest since States. made solar to would overall, deliver builder we in

this a and platform our we're see of building want think also various over for We billion because in area decade. ecosystem. need We invest across big we equity to new next We publicly debt both said opportunity the platforms and capital. the $XXX set

and think we I that generate returns. favorable do can

So I'd is say it's an its exciting area in days of early still that expansion. the

another back question. the And I'll Thanks. queue for get in

Blostein our next from from Alexander to Sachs. question proceed. please Moving Goldman Alexander,

with I about estate perspective, allocation markets of the private place it, could is question. XX taking estate the envision areas different portfolio was real of duration growth. fundraising real of concern and in Thanks And into months? terms you the think from short to funds, Jon, opportunistic Thanks trading of Blackstone good around been estate growth yourself as secular forward outside in I are Blackstone are for kind on public those driving staying of very minutes for I'm and to a curious lots you core everybody. differentiate the how morning. are how of public call particularly is real rates, and an are Hi, seeing spend leading the XX where hoping context today, for how couple REITs. those they products. clear real still why institutional market we guess, you've a broadly, interesting of estate, shares where today in

to assets step and input environment, reason Thanks, up the this like cost, the the my component which goes you hard probably say build environment to interesting build In in an a is big is I'd are money guess the goes back labor up up. replacement significantly. a need on gone up of new Alex. the yield project inflationary and pretty I And the has because cost cost cost largest goes cost that significantly.

talking his units So XX% in today. apartment a of new to to developer has he terms decline to builds cut his X,XXX under next was He budget said units, major I construction. who construction a XX,XXX

start these is long-term what costs, see built. to you said, see an going much and and there's helpful few So input which you because in of they obviously reduction like don't have in in hard environment to a is as assets beneficial the this a happen be supply, are new I exposure to them,

rising and feels environment, building, worse a a you income growing is you're to I see value assets. challenge, if of up. to hard challenge or bond, rate So that asset a gone in argument much an own think then hard course, like have older the office into The not for investing going because rates a is

housing the in if XX% pricing power [indiscernible]. On we're in in or you rents, U.S., of seeing where increases the rental nearly Europe, duration increases logistics, have XX% in other In still rents. you're and hand, the

appreciation, the albeit you a see lower cap up, at as go Even rate. still can rates value

environment, cautious relates but they before, as institutions, we've so in seen it this new real estate way, as much. you lot logistics to vacancy they what They quite of So down side the healthy particularly have and other supply unlike is as more yes, less this allocate almost the this, become limited get rates fundamentals. pause, to and every rental low of and And into by this, cycle, leverage. a we going housing other don't

in to supply, go out. into decline a So we better then way. this result, coming And should sharp this new start even a better as be see in it we

else then world. be anyone – on big scale assets I we area have a long-term which think a I obviously, in good anybody. focus real of in. for is estate, And area we're us, So the would say, the just more see it We obviously ground larger is – than really our than to is

debt and equity. We have both capital, to access

So it's near-term some an if headwinds. area we confidence continue are to even in lot have a there of

very much. thanks Great,

comes from Jefferies. go The Gerry ahead. please from following Gerry, O'Hara question

questions this Thanks morning. for my Great. taking

thinking and earlier. get could comment made LP a questions little with Steve some little or on the a rate bit put Just pressure environment broadly rising of the bit how the about on up talk potential a dynamics on picking sticking rate maybe environment relative But kind can kind to more less income some I of how from, I fixed and an getting from liquid would out that attractive kind and rate am about dynamic mean, play color of forward. might going private markets, LP from be to just curious on exposure you

more Well, want fixed investors. the think, clients look to it and impact rates grade some you generally investment Fixed their above produce starts think they are obligations, I income about our if income. attractive. But long-term does, to

may so you alternatives And move meaningful the think their of get private a short as they the I'm performing income duration what, their interested in best rates. they benefit know don't been I can anything, sector. I credit way. out really what portfolios in is, say if Fed has It because And of raises

interested got tied interested So doing that in that. streams or attractive. and are often it's I'm Blackstone, That's RPI because potentially to in I'm inflation CPI hedges Europe. infrastructure income in

I'm so in interested And that.

institutional But allocate the composition We a the this about where time, our they in particular, still movement of people to procyclical. been and don't be the ones We they just is other long in say haven't at change. a want really interested of The investors could they've I'd see complex. thing seen sector. the out

equity the the you went XXXX, is back a they best way big early if these thing leaving private in not and make So the go to the XXXX, tech doesn't after prices down market growth of sectors went in XXXXs, leave that same a decision. sense, to And time you know back to ton sold off equity.

they say may They're little I'd a view. with a what take They sticking reallocate longer-term they've bit. So done.

we attractive see sort be class. a I large-scale and away scale. think that's private do movement very something of But asset in I will beneficiary, obviously credit don't any from this

you. thank Great,

question comes Bill, proceed. please Credit from Katz Bill The from Suisse. next

you morning taking for up mix for Thank everyone. a Maybe the much and good very and question. Thank little bit. one you Okay. Michael

of Just like want bit a FRE the dynamics to on payout rate. you bit comment And base could, out see between on rate, the performance fee-related sort in contribution? a the you just were unpack the little guidance. Can sounds you at if comp how payout maybe margin of the unpack we to your which discussion of that strip pickup if XX.X%, sort a just FRE

like was two how low new looked ex and year? the ratios particularly This of it Thank performance sort payout into you. see fees the quarter you

in Bill. encourage period. a not look frames, any Look, we at you folks quarter, given movements takes puts know, just to margins I interior single Sure, and always over as think, time longer and

terms is getting And it's about quarter-over-quarter a framed our actually nine ago, of drivers, operating I unpack a it, remarks, in to right in couple talked at driven is terms maybe range – XX is factors. quarters, said on quarter-over-quarter on And year-to-date non-comp question which declined about by basis stable. month of the of on points. up on a factors. expense, respect but we still other at just with ago, similarly, past T&E, expense, points. down in is It's ratio that the side, it X% in year as so then your basis the higher line key basis, the actually a OpEx, And year within and of to XXX comp which year-to-date my compensation looking margin the expense and basis, with in than

things comfortable feel our growth, is overall, support I disciplined carefully line continuing costs growth. few strong and top invest a in our Combined ability So good to within with obviously. the very very our in this all control to of what think approach to cost manage we quarter-over-quarter people reflects and year-over-year to context in management, infrastructure business, and

margin be all the of to in stable continues and healthy result the So very picture. we a of think this,

you. thank Great,

ahead. comes Kenneth, question go Kenneth from following Worthington from The JPMorgan. please

to hoping I good Hi, BREIT could and speak was you BPP. morning.

BREIT, on slowing, picking gross redemptions up. been it have gross like been So sales looks have first

Core+ And coming I like highlighted it assets think, you looks capital I higher. thought said BPP, the I It on returns think the decline Jonathan, there. be redemption that then that months? permanent AUM? in BREIT I quarter. were go you largely What drove during higher flows. into was impacts poised volatility Could there in think may and fell

on specific I So on currency, the was the answer because... BPP, I think that answer think is specific

our The European BPP of plan. translation

Asia. And

Yes.

Asia. And

outflows not there, saw you the what that's complex. of think out I So

flows BREIT, individual said it's not when from had As you've it kind would relates of that in this market deceleration I you remarks, a my surprise see to in a as decline. investors

built. pretty outflows. billion year, as would which like it's $XXX income, it is you out active possible number been to the the remarkably, performance key, positive that I in that think I had and over throughout And near-term But we've the keep we've the time. as delivered negatives of has portfolio and inflows pointing flows, we've some of yes, relates we equity could exceptional. the period which fixed say something know, we see

fullness six of that will at we think in difficult? going X% what XXXX. have investors time. look driver now flows, to per year performance the little you rates. individual that also management respond about makes quarter, or is to to if Does you BCRED rental index So an of delivered floating is we're find REIT these Xx course, these if look quite which the of our is keep owns, over investors to a world we time. saw inflation, offering enormous individual significant what talking are look income so. than look XX% we've to are versus a delivered of in fixed investors versus if is at not positioning key our we this Fed allocated. at in raises X% view striking just the March put the at of BREIT terms then see course, times point time on we're when to at for of course, again, over is of mean you we necessarily we That, X% with greater years. over public the we alternatives and rate of versus is That's And years rest to year, contributor difference. every has which at what XX% versus Yes, the and continue in fact owns, things BREIT, the months is, time, it, what this look this or it biggest the to you portfolios, up losses that There's allocated the context debt, investment to it's this which BREIT But which the look see benefiting, attractive housing, products, institutions two we performance. And And XX% so in X% BCRED that at they

Okay, thank you very much.

Adam next please Adam, is UBS. from from The question go ahead. Beatty

seems you the to and classes morning. ask Thank much about which categories. good deployment, I moderated across wanted pretty have capital to asset various and

dislocation market echoed themes expected the returns. that higher with of the a powder Blackstone at provides is One industry of the in good deploy to idea time kind dry

was little a guess I bit directionally, So it unexpected.

just couple a sometimes opportunities referring sometimes Now that Europe to take minutes of while ago, manifest. Jon a said to that

So expect reason a holding you. a question quarter? Thank to increase there just And should is timing? that it deployment next of a bit? we Is you've been back little

Sellers' back financing, there, time. right into get we muted maybe to we're in expectations of to took That to opportunities to they transaction. and were bit plant for some moment environment. So slows. would will some Adam, kind I find the a XXXX, of able expect be exactly equity went good start And pause. seeds lot ultimately, bit the providing a it Obviously, and going you of sidelines time. transaction to activity back cases, change, if not a that a of a XXXX time. again mean you won't takes dislocation, in deployment dislocation, course, some doesn't of in creative, of move sellers referenced it is then what But it's the lenders, which taking

time. But little there, to over starting become I more confident build their peak head levels. have get will certainty think more out hit inflation rates about until a that it people think you until I down

think a I see of you'll transaction level activity. slower

neither I at buyers is investors forced us to don't that have think the we key time, for be any sellers. nor

others. little able a unleveraged a market So our we low I And more us is if very see can basis when do cost emerges, And we more can then like Areas slowdown you'll at insurance, on I just as a to think relative we tougher in even that move. in environment. to and be an be platform deploy opportunity afford can grows, there capital would activity, say patient. to

will say area. deployment But slower I picking the an expectation of I that reasonable, a meaningfully. busy point, think be some in is up would at but near-term

that returns. terms time of dislocation, really be Michael. take strong periods And XX and to second, add so distinctive. it's Adam, vintages And the history, prove points. to time platform, franchise of out, is a in One just that Jon is it, our and which referenced, which of these couple we so over good our do vintages play years to investment have I'd straddle of

capital at public in our markets tough think, And access dialogues capital privately is advantaged. with and of a companies, companies, quite again, ability I in engage to think, also founders so tougher debt corporations, ability, solutions our and time, sort I around capital to held

So play will we'll time will of periods these out in be be to have for to terms take of ultimately patient. but levels, creation. dislocation It activity prove to opportunities value

you Much guys. appreciated. thank Excellent,

The following question Patrick, Autonomous. from please is Patrick Davitt from proceed.

and think about... looks the good topic, I same up Obviously, like better private lack specific credit. we My Hey, you, in XQ. that more everyone. should and held well how But spreads deployment pretty to morning, appreciate it question comments of helping on competition on your

dropping we’re you. we're Patrick, – losing

Can now? you hear me

Yes.

Okay.

of deal deployment. hold lot pretty deal the in XQ. about do particular, pace competition of are kind deterioration credit up that deployment we continued deal the So getting in should on think it lower? in of you and markets? good if period sponsored offsets volumes Do But yes, the And how so, so volumes, a And credit if I being think up appreciate comments anemic? M&A better what think helping you increasingly can a and held through spreads

what are that I offsets that borrowers. lower to fact direct the certainty provide deal think lenders is the volumes

environment like distribution in don't to the a business, because going is. this, institution So end you market cautious financial in know the where you're if an you're be

but market. aren't I direct paper, providers advantage lenders, have so an think just the And this distributing of holding of will who capital kind it in volatile

our dynamic in than insurance a doing somebody paper distributing movement seeing think investment-grade so we're similar And a origination – that rather lending. the it's for direct today. definitely paper, towards we're where And direct insurance I clients. There's

So will done a point, think at investors transactions to will the opportunities to discussions. get amazing feel There And At way along be opportunities. better about, rates the are continue go. lot private there there. there. And us. I what's a market, point we'll and getting allocate little still when get here, top and of begin inflation, been there’s of to to equity People things we've equity lot talked will we've performance. a you deliver is will throughout continue I level. out a to capital capital say, found look at We a some lower There's will this good to some continued as

a this for and So to before. get it sort of And cycles firm plenty there'll through side. confidence we've other through get gives the been of as think us be other built as this. We we and opportunities we

Thanks.

Finian, go ahead. please Fargo. from O’Shea next Our from Wells question is Finian

morning. Good everyone. Hi,

on staying any same you talk the of theme. impact Can markets Sort strategies? growth on about funds? any platform for in the see you the And there financing across or if particular

you When transaction you funds, for mean financing financing? say

yes. sometimes. But We'll say yes, capital markets borrowing banks, from transaction securitization, –

it a we've said, – out. we've Banks' have appetite I gapped was lower slowdown. seen Yes, as risk definitely And before. is than spreads

bit materially. not-too-distant think what to little lot some it see, cost I you'll or the some seller a look off is that is you tougher if market. if transactions provide who said, There's But markets of in this sort spot, is if our XXXX, XXXX, done. cost, makes uncertain a – said, debt want I at but of it abundant are as And and And going to a think financing of message potentially in you in financing of harder. like And environment. up XXXX, I periods being still low would somewhere, you that generally the But investors, of out, because is where We're sell bit future. in have deal debt better calm company financing point overall deal gone you over-equitize do I us. like better to off more assets of a investors real we're capital emerge see But money. it's sellers finance capital has lot today to borrow today, unique can where anyone pay some ultimately get where in may then we buying examples if an a an environment is So I markets that down estate in it the as like the you're creativity the when buying to done scarce, for and to future. get versus definitely a is we're things will think, environment have harder

Thank you.

The comes from McKenna Brian, Brian ahead. following from please go question JMP Securities.

Thanks. morning, everyone. Good

question a has had despite for pretty fund solutions. actually performance I tough on healthy backdrop public So hedge the Year-to-date markets. been

business then any So the fees in this increased heels are for quarter? product year-end you tracking of starting the for how see to the related, demand the performance? fourth on incentive And is

and couple that quarters. that LP in the the we this highlighting here We business is environment endowment professional brought the And had comment XX/XX on Joe into worst positive given the Brown our the three been That performance, outstanding ago. the capital operate. of who team, they since Dowling, are that has particularly week. Well, of all ran this additional exceptional, Joe's and XXs we we early board really a meeting on scale the I'll fact the BAM were fact actually brought the just previously years investment

who We that will not generate investors in about think takes a still proud I BAM attractive for we more really these bit can could macro more this in of performance early I like been, what's a over to us time strategies time. has team now And investment have some delivered. happening I credit-related recognizing the think an it. the bit momentum be that of on think, It cautious fund here, the but feel non-directional good see returns. terms little of give hedge environment it's of strategies investors a quant in sector,

Thank you.

from Chris go comes ahead. The following question Kotowski from please Chris, Oppenheimer.

me apartment, year, are the next Thanks. thing year are I are if good estimates estimates guess, for the down is at up, lodging public, I striking and are rates, higher the XX%. earnings that but for morning. to Yes, mean, logistics you the this the up, stocks than the look

a think to BREIT a, liquidity gets run to you then And need when one, leads there whole for all methodology just looking do And more use the a to you BREIT, public in attractive apply the to so, perception b, I with guess, case your relative that bunch at look the in more of asset and sudden companies, it if you me do negative? your those valuations? values

estate X% Yes. I’ll as start public on lot you the interesting market. small. It It’s real out. What’s pointed probably estate commercial valuations. real a of of or U.S. it’s trades volatility, market, pretty about the X% with

of privates euphoria above And trade done real the In therefore look investor? up public can And phenomenal the the tend you’ve believe, if decline which private a And values you it’s down those idea opportunities by And opportunity between XX that. And than day is more space. seem period do and seen value, we But can in over fact, that’s if or markets, don’t above market, was private time, you’re go is XX%, think real giving XXx, public the I – it’s similarly was the very very, trading would performance what does. XXXX, actually market is, at to market who NAV part estate the happened at course, an up space many housing. the markets largest does estate, analysts it which now go since us, down below the we’ve gone as private of have seen the the private gone and appreciate to logistics the during cases don’t below. real markets below hasn’t public in happening to estate and forth generally that sharply rates in opportunity rental in certainly. back. the cover at many, here public in and once. period, estate create can the it in of short answer at they today heading the for market. many that say into because markets were look this real And some you market for the back We’ve real estate It the And create so depression. create us

to volatility relates mind keeping it As this there that product in BREIT, can markets. built be in we

with And of So cash of we since run throughout ample the including started the COVID. and ago, seller years vehicle a liquidity, amounts we of assets. structure debt securities. liquid large met repurchase of revolvers, six never We’ve we’re requests for large amounts means the XXX%

about focusing talked and and BREIT So to we any vast much logistics the And its to feel again, earlier, really back weather good I rental on are we ability environment majority about where pretty what a housing could storm. good United not better portfolio over about really time. And the southern in. we’re built assets of have the BREITs States, the going feel where you in for

Thank interesting. Very you.

question next Our from Rufus comes Hone please go ahead. Rufus, from BMO.

the down. on get portfolio performing? on costs to higher manage Thanks portfolio ability was an to hoping to are at debt related very much. Good Great. as economy also companies. And update service equity slows I companies that, you’ve private was curious your morning. how how the debt their structured your And know to I

could you floating you. Thank would to the between what may floating really fixed be you rate what debt? portion And mix extent that share and helpful. If is the have roughly hedged

private start portfolio this while, our good for Rufus, and about a with been really feel obviously the question. the We’ve this at equity is I’ll Michael. position are in. financing last companies our

– is Our remaining average around maturity portfolio in maturity private debt years. five equity our

most high terms is sub obviously as rates. while a a senior an And higher portion there’s base significant portion our then – fixed hedge of say also from the we component debt. the to And especially or fixed position good in relates rate it I’d over In hedging, There’s period a portfolio a interest a time. standpoint, of from baseline in of cases. debt then very, yield to floating component, cushion anticipating coverage level very even a

Resorts, we I revenue have business. leisure, would And wise, strength like again growth. remarkable Crown as in visa performance XX% we businesses and Entertainments, quarter processing third say about Merlin talked Real travel a the

companies seeing very All growth. of revenue these strong

energy large energy We and exposure to have transition.

the that’s big Of think And sector difference for sort the areas made I there. out overall mix of global best course, positioning that us, one of very been in has companies a of the economy. relative

businesses, when also, investing, continuing on enterprise which businesses, did technology focused grow we to tech nicely. are We tech we profitable

mean still but So our opening, in we least is still Labor we costs today, the slow are growing particularly portfolio as good. ground still companies, pressure pretty down the line revenue say for in as But really momentum. I some the seeing out as And there. fast we’re bottom on the is. is there said economically, our at that would good line’s not margin

Thank you.

is Up BNPP from Giblat Arnaud next Exane.

attractive up Good if comment you there Europe. a of Hi. is question of secondary secondary you. setting that funds morning. that. for have opportunities U.S. on the pricing your the was lot been some could markets. been in Have the Thank My wondering are markedly out stakes on news picked funds? pension I flows and LP There’s is volumes suggesting in and

comments We great a for a pause leader will like industry is this time valuations come really what $XX moments happens little sellers. a from to it’s bit earlier think want where fund. you see be and my They What in wait like out. billion see secondary a

I grown well of the speaks to business the need get discounts because there power months this Sometimes of the been That’s hasn’t potential believe scale platform been to of see when accept a XX in growth again, very it invest all of we’ll have about enough We for well would ability to platform space. pick history, the they valuations take leading reasons, you for It secondary industry in And variety our that positioned be area really in is were secondary’s And funds advantageous. fact in is not say way, may enthused because pickup the that the as we’ve six happen. marked funds. and a that may than wide activity as a Blackstone. sorts but of The liquidity that alternatives and the months our in a they it happens, are as down. volumes. people just got overall they big Then up. see may different earlier. transaction

which advantage for gives holistic competitive in invested than funds, a X,XXX more real We’re us solution. a when looking somebody’s

it’s space. we like bit little to a think space, It the quarters. just going for couple a be busy slower a here be may So we

Thank you very much.

comes final Deutsche please Our ahead. go from Bank. Brian Brian, question Bedell from

Great. follow-up. Thanks for my taking

unpack those back a in that in a that different And go terms bit little Resolution you of mentioned to to to block second, be think a billion I aggregator. Life confidence of drivers on able $XXX your potential of Would you being the wanted for insurance. rough a Just components timeframe? say, you fundraising

Yes.

billion $XXX plus is grow as plus think the billion the really where bit of that’s we On going little Corebridge $XXX plus growth well. Resolution, to both a to today organic

expected billion $XXX be four will that contractually Jon’s over $XXX so are $XXX the managed. grow that to so It’s AUM billion partnerships total number that And big or that or about There’s referencing. of from billion time. to these insurance subset

Yes. is their legacy this focus what’s closed on Resolution, On attractive blocks. to us that

very and And what bringing talked trend what team very a want lot an and to of liquid been is is old where life And built originate to scale, very but a Cadre book. of a was as them estate not new I credit. Resolution loans, we’re this real there much engine. a deal area but do was loans, And call opportunity. to compelling the a to of liabilities long this service focus the is to back done there who generally The has only Resolution uniquely capital CEO asset grow about, And of rated help another on fixed today. move and out historically time so the we mega this doing that directly the we What customers. ability that this the it it insurance hadn’t positioned. ability Resolution underwrite their us asset flow are loans is then think And make infrastructure is income. to is lot there time. gives about terrific for at it. out companies think exciting to corporate insurance buying side, he loans, is a He’s good

are obviously big in Resolution we of Corebridge the we’ve have closed focused In way. growing and fixed in got So also case the annuity these on F&G, a that space blocks. firms

And engines multiple assets up in for rates spreads the the of widened. moved got have we’ve So growth this space. have base and

where of very So be a it’s to and if time you market credit, that traditional fixed income repositioning out this into is a attractive private think about capital moment. deploying

on excited about, have to and model this about we as which don’t insurance and we like asset We’re like take is talked liabilities we really this multi-client.

and diversification just we work them. not with the who all sheet, give from of variety balance can benefit a can clients by limited we scale We’re one

Great. That’s very interesting. Thank you.

now Allow remarks. for hand it back to me Tucker Weston to closing

Okay. to everyone today forward Thank the us you after joining for look call. and following up

joining everyone. for That you Thank concludes conference. your

You Goodbye. may now of day. disconnect. Please enjoy your rest the