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The Blackstone Group L.P. Message Board

  • myprofile96 myprofile96 Jul 11, 2012 2:25 PM Flag

    A 9 billion profit

    just finished reading the Tuesday's WSJ article on Blackstone's planned sale of some real estate properties. Appears it could generate a $9 billion profit. Wow! I know that this won't all flow through to the public shareholders,and it'll take a few quarters to divest, but i'm amazed that the stock isn't soaring on the news. Even a small passthrough will allow the firm to easily beat quarterly estimates and return capital to investors. if i'm missing something, i'm open to constructive information. If not, cant wait until next week's earnings release to learn more. The second half of the year could be really, really interesting

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    • Most of the profits will go to the private equity investors who bought into the Real Estate fund 5 years ago. BX raises money from institutional investors and High net worth individuals, who expect high profit for themselves (not BX public sharholders). Blackstone will be making annual management fees of 1-2% on the overall RE portfolio and then maybe 15-20% of the profit when the real estate is sold or they form an IPO. As of today, there is no realized profit so BX shareholders have no gains. BX management will pay themselves first from the management and performance fees and whatever is leftover, will go to shareholders. So BX shareholders only share in management fees and not the overall profit of the PE fund.

    • Shareholders will not benefit and stock will continue to fall
      as evidenced today.

      The big boys already bailed-out during the past weeks.

    • 19 billion. The outlay was 39 billion, they sold off 36 billion and are about to pull the trigger on another (appx) 22 billion sale...39 billion in, 58 billion out, profit of 19 billion.

 
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