Blackstone dry powder soars 73% to $80bn

At the end of 2015, the global firm reported $79.7 billion in dry powder, of which $37.4 billion was attributable to private equity.

Blackstone’s total dry powder at the end of last year stood at $79.7 billion, up 73 percent year-on-year, the firm said in an annual results statement. Private equity accounted for $37.4 billion of the total, followed by real estate at $23.5 billion.

The firm raised a total of $29.6 billion last year, with $5.2 billion in the last quarter, driven by recent private equity and real estate fund raises.

Its flagship vehicle, Blackstone Capital Partners VII, reached a final close in late December on $18 billion, above its $16 billion target, as reported by Private Equity International.

The firm had $111 billion in capital committed to private equity as of 31 December, with $41 billion in available capital.

However, the firm’s economic net income, which accounts for unrealised investment gains or losses, plummeted 51 percent to $2.2 billion last year, with fourth quarter ENI down 70 percent on the same quarter the previous year at $436 million.

Blackstone’s private equity business deployed $11.4 billion in 2015, of which almost half was in the final quarter, with additional commitments of $1.2 billion in Q4 in new and existing investments, the results statement said.

Across the firm’s business lines, which include private equity, real estate, hedge funds and credit, it deployed $32.4 billion into new investments, including $15.7 billion in the fourth quarter. This was “a record pace which accelerated in the fourth quarter given the increasingly attractive investment backdrop,” Blackstone chairman and CEO Stephen Schwarzman said in the statement.

Blackstone returned $55.4 billion to investors last year, of which $43 billion was to fund investors. Its private equity arm made $13.5 billion of realisations over the course of 2015, of which $3.4 billion was in the final quarter.

Private equity assets under management rose 29 percent on the previous year to total $94.3 billion in 2015. The firm’s total AUM reached a record $336.4 billion as a result of “strong fundraising and organic expansion,” the statement said, up 16 percent on the previous year. Inflows totalled $15.5 billion in the fourth quarter and full year inflows stood at $93.6 billion, it said.

Overall fee-related earnings dropped to $311 million in the fourth quarter compared to $385 million in the previous year, which Blackstone said reflected the spinoff of its advisory business. For the year, fee-related earnings totalled $936 million, compared to $1 billion the year before.

The private equity business saw a drop in total performance fees from $1.9 billion in 2014 to $757 million last year, while management fees remained fairly constant at $513 million in 2015 compared to $554 million the year before.