Institutional investors back one of Blackstone’s largest private commercial lending funds
Blackstone has finalized its latest real estate debt fund, Blackstone Real Estate Debt Strategies V (BREDS V), securing $8 billion in total capital commitments.
The fund, one of the largest private commercial property lending pools globally, comes at a time when traditional banks have pulled back on real estate financing, creating an opening for private lenders to step in.
Despite high interest rates slowing overall fundraising efforts, debt-focused real estate funds have gained traction, as major investors look for alternatives to traditional financing.
BREDS V, launched in October 2022, has continued attracting institutional capital, with $3 billion raised since July 2023. The California Public Employees' Retirement System (CalPERS) committed $1.5 billion to the fund last summer, and, by September, it reported a 5% increase in the value of its investment.
Another major backer, the School Employees Retirement System of Ohio, committed $40 million and saw a 5.56% return on paid-in capital in Q4, according to system data.
Blackstone’s real estate debt platform is designed to provide mezzanine loans and debt securities for commercial properties worldwide. Among its recent deals, BREDS V issued a $157.4 million loan to finance Lincoln Property Co. and SVP Global's acquisition of The Bluffs office park in Playa Vista, California, according to CoStar data.
With $77 billion in real estate debt assets under management, Blackstone’s lending business continues to expand, supported by a team of over 170 professionals globally.
“We are extraordinarily appreciative of our investors for allocating this amount of capital during this period of market dislocation,” Tim Johnson, global head of Blackstone Real Estate Debt Strategies, said in a media release. “We could not be more enthusiastic about the opportunities ahead and with the support of the largest owner of commercial real estate as well as the largest alternative real estate credit platform in the world, BREDS V is well-positioned to deliver in this attractive vintage.”
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Blackstone’s broader real estate division, which was founded in 1991, now oversees $315 billion in investor capital, making it the largest owner of commercial real estate globally. The firm’s holdings include logistics centers, data centers, residential buildings, offices, and hotels.
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