Private equity firm the Blackstone Group has raised about $3 billion for a new real-estate fund and expects a first closing for its seventh real-estate fund in the third quarter, according to the Wall Street Journal. Overall, the firm has indicated, it is targeting about $10 billion for the fund.
The firm said second-quarter profit more than tripled on gains in the value of its buyout and real estate investments, Bloomberg News reported, with profit increasing to $703 million, or 63 cents per share, from $205 million, or 18 cents per share, a year earlier.
“A material portion of the increase in revenues was due to the impact of the ‘catch-up’ provisions of the real estate funds’ profit allocations,” Blackstone said in the statement. The provisions “specify that once a fund’s preferred return hurdle has been reached, Blackstone is entitled to a disproportionately greater share of the profits until it effectively reaches its full share of performance fees.”
In June, it was reported that Blackstone will borrow up to $1.35 billion to refinance the debt on a portfolio of office buildings largely comprised of California properties. Blackstone acquired most of the properties through its purchases of CarrAmerica Realty and Trizec Properties in 2006.