Blackstone fundraising boom continues with $24bn in Q3

Blackstone has continued what founder and chief executive Stephen Schwarzman has dubbed a fundraising “supercycle”, as the New York-based firm pulled in $24.1 billion over the third quarter and $124.6 billion in the last 12 months.

Blackstone raised $6.5 billion for corporate private equity during the quarter, mainly for its energy and Tactical Opportunities funds. Over the last 12 months, the firm has raised $19.6 billion for private equity, and it has its sights set on a new flagship fund – expected to be around $20 billion.

“Corporate PE, PE secondaries, global and European opportunistic real estate have all launched fundraising or soon will,” president and chief operating officer Jonathan Gray said on the firm’s third quarter earnings call on Thursday.

“These funds were collectively $50 billion in their last vintage. We expect all will be larger and finish fundraising in 2019.”

Blackstone also detailed its new life sciences platform. At its investor day in New York in September, executive vice-chairman Tony James outlined the firm’s new initiatives, which included the dedicated life sciences vertical. Two weeks later, the firm announced the launch of Blackstone Life Sciences with the agreement to acquire global life sciences investment firm Clarus.

“Although this business will not initially have a material impact on our financials, it has great potential over time, given the rapid advancements in science and innovation occurring in this sector and the current lack of funding and operational resources,” Schwarzman said on the investor call.

Clarus, which has offices in Boston and San Francisco and focuses on funding growth-stage investments, has raised $2.6 billion since its founding, according to a statement from Blackstone announcing the acquisition.

Blackstone Life Sciences intends to invest “across the life-cycle of companies and products within the key life sciences sectors”, filling a “critical void in the industry, which is seeing unprecedented growth, but lacks the necessary funding to bring medicines and healthcare technologies to market”, according to the statement.

During his investor day presentation, James said the strategy would start with a “few billion” dollars of assets under management, which could scale up to tens of billions.

The record inflows across the company have propelled Blackstone’s assets under management to $456.7 billion – a year-over-year increase of 18 percent. Total dry powder was $95 billion, of which $40.5 billion is in private equity.

– Andrew Hedlund contributed to this report