Blackstone Plans to Invest $500 Billion in Europe

Blackstone Inc, the world’s largest alternative asset manager with more than $1 trillion in ASSETS Under Management (AUM), is planning to invest as much as $500 billion in Europe over the next 10 years, underlining the continent’s growing appeal to investors during a period of geopolitical flux.

In an interview with Bloomberg Television on Tuesday, Blackstone’s Chairman and CEO Stephen Allen Schwarzman said that they see it as a major opportunity for the company.

“They are starting to change their approach here, which we think will result in higher growth rates and this has worked out amazingly well for us,” he said.

Schwarzman’s comments, which mark the 25th anniversary of the alternative asset manager’s operations in London, are the latest sign of investment firms touting the attractiveness of Europe.

At last week’s SuperReturn International conference in Berlin, executives from behemoths such as BC Partners, Permira and Brookfield Asset Management talked up the case for Europe as an investment destination as global economic risks mount.

When Blackstone opened its London office in 2000, the firm’s only other office was in New York and raised more than $13 billion for discretionary investment funds focused on alternative asset classes at that time.

Blackstone is the largest fund manager in European real estate, according to industry group INREV. A bet on the continent’s urban warehouses is one of Blackstone’s largest and most profitable investments ever.

The firm’s London office, which is due to move to a new building that’s currently under construction on Berkeley Square in Mayfair, now employs 650 people, Schwarzman said. The firm has about $100 billion invested in the UK already, making it one of the largest foreign investors in the country, he added.

Blackstone has poured capital into UK real estate bets, including a site for a data center in the north of England that has the potential to be Europe’s largest and the UK government has been really helpful, really focused to make that happen, Schwarzman said.

Looking to Middle East

Outside Europe, Blackstone is also looking to the Middle East as an investment destination, rather than simply a region in which it has raised vast sums of capital.

While the region has traditionally been dominated by local businesses and capital, the rapid growth of cities including Riyadh and Dubai as international hubs is making it an attractive opportunity, he said.

Meanwhile, in a social media post, Blackstone Co-Chief Investment Officer Lionel Assant pointed out that on the deals front, the firm bought the Savoy Group, Merlin Legoland, United Biscuits, and, more recently, Adevinta.

Assant said that the firm expects the cost of debt to decrease, which is beneficial to their business as inflation returns to pre-COVID levels.

“And while we see some choppiness in the markets, it’s actually not unhelpful to us because we always take the long-term view and it enables us to lean in on assets and sectors like digital infrastructure, energy transition that we like,” Assant said.