Blackstone has successfully raised $8 billion for its latest real estate debt fund, Real Estate Debt Strategies V (BREDS V), mirroring its 2020 fundraising milestone. The new fund will focus on distressed real estate debt, capitalizing on opportunities from the significant $1.5 trillion wave of commercial real estate (CRE) debt maturities set to occur this year.
With an eye on assets across North America, Europe, and Australia, BREDS V will target bridge and mezzanine financing for properties struggling to refinance in today’s high-interest-rate environment. The fund will also purchase existing loans from banks and insurers seeking to reduce their CRE exposure and partner with financial institutions to assume higher-risk, higher-yielding portions of deals.
Blackstone, which currently manages $77 billion in real estate debt and holds $315 billion in real estate assets, has already begun deploying capital from BREDS V, with its first deals completed in late 2023.
As banks scale back their lending activities, Blackstone is stepping up to fill the financing gap, betting heavily on the volatile commercial real estate market. The strong investor demand for the fund reflects renewed optimism in CRE debt, a trend also reflected in the rising fortunes of real estate investment trusts (REITs).
