Global investment firm The Blackstone Group recently launched a $20 billion private real estate fund, the largest ever, focused on buying up office towers, shopping centers and hotels worldwide. The record-setting real estate fund is anticipated to have a domino effect, as pension funds, institutions, wealth investors and foreign governments look to cash in on rising property prices. According to the WSJ: “the recent stock market volatility has made public targets even more attractive to private buyers like Blackstone.”
As more investors clamor into private real estate funds, the need for a more streamlined process of managing these investments will become abundantly clear. Firms like Blackstone, which acquired 11 public companies in 24 months, are acutely aware of the demands of public market investors regarding transparency into their investment portfolio. Smart securities are therefore a logical application to private real estate funds.
Templum recently closed what is believed to be the first digitized offering of a marquee real estate property with St. Regis Aspen Resort, which we see as the model for how digitalization of real estate assets will work. Through a private REIT, issuers and/or fund managers can offer a portion of their asset portfolio to a group of approved investors. In the case of Blackstone’s $20 billion fund which includes multiple properties, this could help offer investors exposure to multiple assets within a portfolio while still maintaining the security and transparency they demand.
Consolidating all of these private market transactions will only continue to grow the space and will require a platform like Templum to provide regulated market infrastructure and a network of vetted secondary buyers to continue to help move the market forward. We couldn’t be more excited about the opportunity that lies ahead.