Blackstone Real Estate brings institutional-caliber private real estate to income-focused investors. 1
Shifting The Paradigm for Non-Traded REITS
BREIT gives individual investors access to Blackstone’s leading institutional real estate platform with proven real estate experience and prominent U.S. presence.
BREIT directly owns stabilized U.S. commercial real estate assets which have historically delivered attractive and consistent rental income to investors.
BREIT invests across property types and active sector selection may help drive higher returns.
BREIT’s proactive asset management may drive higher rents and property values helping to generate capital appreciation for investors.
BREIT is a non-traded vehicle which means the value of shares is more closely tied to real estate fundamentals as opposed to public equities.
Alignment of Interests5
BREIT’s advisor is compensated via management fees and a performance participation allocation based on total return. BREIT’s advisor does not receive acquisition, disposition, financing or development fees.
*BREIT’s share price is subject to less volatility compared to public equities because its per share NAV is based on the value of real estate assets it owns and is not subject to public market pricing forces as is the price of public equities. Although BREIT’s share price is subject to less volatility compared to public equities, the value of real estate may fluctuate and may be worth less than was initially paid for it. BREIT shares are significantly less liquid than public equities, and are not immune to fluctuations.
Key Terms Definitions
|Product||BREIT is a perpetual-life, institutional-quality real estate investment platform that brings private real estate to income-focused investors|
|Structure||Non-listed, perpetual life real estate investment trust (REIT)|
|Investment Guidelines||At least 80% in real estate investments and up to 20% in real estate debt investments, cash and/or cash equivalents|
|Sponsor/Advisor||Real Estate Group of The Blackstone Group Inc. / BX REIT Advisors L.L.C.|
|Maximum Offering7||$24 billion|
|Offering Price8||Generally equal to our prior month’s Net Asset Value (NAV) per share for such class as of the last calendar day of such month, plus applicable selling commissions and dealer manager fees|
|Subscription/NAV Frequency||Monthly purchases as of the first calendar day of each month; subscription requests must be received at least five business days prior to the first calendar day of the month|
NAV per share, which will generally be equal to our transaction price, will generally be available within 15 calendar days of month end
Transaction price will be available on www.breit.com and in prospectus supplements. If the transaction price is not made available on or before the eighth business day before the first calendar day of the month, or a previously disclosed transaction price for that month is changed, then we will provide notice of such transaction to subscribing investors
|Distributions||Monthly (not guaranteed, subject to board approval)2|
|Minimum Initial Investment9||$2,500|
|Suitability Standards9||Either (1) a net worth of at least $250,000 or (2) a gross annual income of at least $70,000 and a net worth of at least $70,000. Certain states have additional suitability standards. See the prospectus for more information|
|Share Repurchase Plan2||Monthly repurchases will be made at the transaction price, which is generally equal to our prior month’s NAV|
Shares not held for at least one year will be repurchased at 95% of that month’s transaction price
Total repurchases are limited to 2% of aggregate NAV per month (measured using the aggregate NAV as of the end of the immediately preceding month) and 5% of aggregate NAV per calendar quarter (measured using the average aggregate NAV as of the end of the immediately preceding three months) (in each case, including repurchases at certain non-U.S. investor access funds primarily created to hold shares of BREIT)
Repurchase requests must be received in good order by the second to last business day of the applicable month
We are not obligated to repurchase any shares and may choose to repurchase only some, or even none, of the shares that have been requested to be repurchased in any particular month in our discretion
The share repurchase plan is subject to other limitations and our board may make exceptions to, modify or suspend the plan
|Tax Reporting||Form 1099-DIV|
Share Class-Specific Fees
|Fees||Class I||Class D||Class S||Class T|
|Availability||Through fee-based (wrap) programs, registered investment advisors, and other institutional and fiduciary accounts||Through fee-based (wrap) programs, registered investment advisors, and other institutional and fiduciary accounts||Through transactional/brokerage accounts||Through transactional/brokerage accounts|
|Selling Commissions (UPFRONT)9||None||Up to 1.5%||Up to 3.5%||Up to 3.0%|
|Dealer Manager Fee (UPFRONT)9||None||None||None||0.50%|
|Stockholder Servicing Fees (per annum, payable monthly) (ONGOING)9||None||0.25%||0.85%||0.65% financial advisor|
|Management Fee||1.25% per annum of NAV, payable monthly|
|Performance Participation Allocation||12.5% of the annual total return, subject to a 5% annual hurdle amount and a high water mark|
|Class I||Class D||Class S||Class T|
|As of November 1, 2021||1,876,216,198||273,390,405||1,185,295,412||56,161,149|
BREIT Literature and Resources
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- Distributions are not guaranteed and may be sourced from non-income items.
- There is no assurance we will pay distributions in any particular amount, if at all. Any distributions we make will be at the discretion of our board of directors. We may fund any distributions from sources other than cash flow from operations, including, without limitation, the sale of assets, borrowings, return of capital or offering proceeds (including from sales of our common stock or Operating Partnership units to the Special Limited Partner, an affiliate of Blackstone), and we have no limits on the amounts we may pay from such sources.
- There is no guarantee that BREIT will be diversified. Diversification does not eliminate risk or guarantee a profit.
- There can be no assurance that BREIT will achieve its objective or avoid losses.
- Blackstone will also face conflicts of interest as a result of, among other things, the allocation of investment opportunities among us and other Blackstone accounts, the allocation of time of its investment professionals and the substantial fees that we will pay to Blackstone.
- Terms summarized herein are for informational purposes and qualified in their entirety by the more detailed information set forth in BREIT’s prospectus. You should read the prospectus carefully prior to making an investment.
- Exclusive of $17 billion raised in prior offerings. This is the amount currently registered. We may register additional shares in the future.
- We may offer shares at a price that we believe reflects the NAV per share of such stock more appropriately than the prior month’s NAV per share, including by updating a previously disclosed offering price, in cases where we believe there has been a material change (positive or negative) to our NAV per share since the end of the prior month. For further information, please refer to the “Net Asset Value Calculation and Valuation Guidelines” in BREIT’s prospectus, which describe our valuation process and the independent third parties who assist us.
- Select broker-dealers may have different standards to determine the appropriateness of this investment for each investor, may not offer all share classes, and/or may offer BREIT at a higher minimum initial investment. With respect to Class T shares, the amounts of upfront selling commissions and dealer manager fees may vary at select broker-dealers, provided that the sum will not exceed 3.5% of the transaction price. The financial advisor and dealer stockholder servicing fee for Class T shares may also vary at select broker-dealers, provided that the sum of such fees will always equal 0.85% per annum of the aggregate NAV of such shares. Broker-dealers may also charge additional fees for certain accounts, such as wrap accounts.
Key Term Definitions:
- Performance participation allocation: The Special Limited Partner will hold a performance participation interest in the Operating Partnership that entitles it to receive an allocation from our Operating Partnership equal to 12.5% of the Total Return, subject to a 5% Hurdle Amount and a High Water Mark (each term as defined below), with a Catch-Up. Such allocation will be made annually and accrue monthly.
- “Total Return” for any period since the end of the prior calendar year shall equal the sum of: (i) all distributions accrued or paid (without duplication) on the Operating Partnership units outstanding at the end of such period since the beginning of the then-current calendar year plus (ii) the change in aggregate NAV of such units since the beginning of the year, before giving effect to (x) changes resulting solely from the proceeds of issuances of Operating Partnership units, (y) any allocation/ accrual to the performance participation interest and (z) applicable stockholder servicing fee expenses (including any payments made to us for payment of such expenses). For the avoidance of doubt, the calculation of Total Return will (i) include any appreciation or depreciation in the NAV of units issued during the then-current calendar year but (ii) exclude the proceeds from the initial issuance of such units.
- Specifically, the Special Limited Partner will be allocated a performance participation in an amount equal to:
- First, if the Total Return for the applicable period exceeds the sum of (i) the Hurdle Amount for that period and (ii) the Loss Carryforward Amount (any such excess, “Excess Profits”), 100% of such Excess Profits until the total amount allocated to the Special Limited Partner equals 12.5% of the sum of (x) the Hurdle Amount for that period and (y) any amount allocated to the Special Limited Partner pursuant to this clause (this is commonly referred to as a “Catch-Up”); and
- Second, to the extent there are remaining Excess Profits, 12.5% of such remaining Excess Profits.
- Specifically, the Special Limited Partner will be allocated a performance participation in an amount equal to:
- “Hurdle Amount” for any period during a calendar year means that amount that results in a 5% annualized internal rate of return on the NAV of the Operating Partnership units outstanding at the beginning of the then-current calendar year and all Operating Partnership units issued since the beginning of the then-current calendar year, taking into account the timing and amount of all distributions accrued or paid without duplication on all such units and all issuances of Operating Partnership over the period and calculated in accordance with recognized industry practices.
Summary of Risk Factors
BREIT is a non-listed REIT that invests primarily in stabilized income-generating commercial real estate investments across asset classes in the United States and, to a lesser extent, real estate debt investments, with a focus on current income. We may invest to a lesser extent in Canada and Europe and potentially elsewhere. This investment involves a high degree of risk. You should purchase these securities only if you can afford the complete loss of your investment. You should read the prospectus carefully for a description of the risks associated with an investment in BREIT. These risks include, but are not limited to, the following:
- There is no public trading market for our common stock and repurchase of shares by us will likely be the only way to dispose of your shares. We are not obligated to repurchase any shares under our share repurchase plan and may choose to repurchase only some, or even none, of the shares that have been requested to be repurchased. In addition, repurchases will be subject to available liquidity and other significant restrictions. Further, our board of directors may make exceptions to, modify or suspend our share repurchase plan. As a result, our shares should be considered as having only limited liquidity and at times may be illiquid.
- We cannot guarantee that we will make distributions, and if we do we may fund such distributions from sources other than cash flow from operations, including, without limitation, the sale of or repayments under our assets, borrowings or offering proceeds, and we have no limits on the amounts we may pay from such sources.
- The purchase and repurchase price for shares of our common stock are generally based on our prior month’s net asset value (“NAV”) and are not based on any public trading market. While there will be independent annual appraisals of our properties, the appraisal of properties is inherently subjective, and our NAV may not accurately reflect the actual price at which our properties could be liquidated on any given day. The NAV per share, if calculated as of the date on which you make your subscription request or repurchase request, may be significantly different than the transaction price you pay or the repurchase price you receive. Certain of our investments or liabilities are subject to high levels of volatility from time to time and could change in value significantly between the end of the prior month as of which our NAV is determined and the date that you acquire or repurchase our shares, however the prior month’s NAV per share will generally continue to be used as the offering price per share and repurchase price per share.
- We are dependent on BX REIT Advisors L.L.C. (the “Adviser”) to conduct our operations. The Adviser will face conflicts of interest as a result of, among other things, the allocation of investment opportunities among us and Other Blackstone Accounts (as defined in BREIT’s prospectus), the allocation of time of its investment professionals and the substantial fees that we will pay to the Adviser.
- On acquiring shares, you will experience immediate dilution in the net tangible book value of your investment.
- There are limits on the ownership and transferability of our shares.
- If we fail to qualify as a REIT and no relief provisions apply, our NAV and cash available for distribution to our stockholders could materially decrease.
- We do not own the Blackstone name, but we are permitted to use it as part of our corporate name pursuant to a trademark license agreement with an affiliate of Blackstone Inc. (together with its affiliates, “Blackstone”). Use of the name by other parties or the termination of our trademark license agreement may harm our business.
Certain countries have been susceptible to epidemics which may be designated as pandemics by world health authorities, most recently COVID-19. The outbreak of such epidemics, together with any resulting restrictions on travel or quarantines imposed, has had and may in the future have a negative impact on the economy and business activity globally (including in the countries in which BREIT invests), and thereby may adversely affect the performance of BREIT’s investments. Furthermore, the rapid development of epidemics could preclude prediction as to their ultimate adverse impact on economic and market conditions, and, as a result, presents material uncertainty and risk with respect to BREIT and the performance of its investments. For further information on the impact of COVID-19 on BREIT, please refer to “Risk Factors—The current outbreak of the novel coronavirus, or COVID-19, has caused severe disruptions in the U.S. and global economy and has had an adverse impact on our performance and results of operations” in BREIT’s prospectus.
Financial information is approximate and as of September 30, 2021, unless otherwise noted. The words “we”, “us”, and “our” refer to BREIT, together with its consolidated subsidiaries, including BREIT Operating Partnership L.P., unless the context requires otherwise.