Blackstone REIT blocks investor withdrawals in January

February 1 (Reuters) – Blackstone Inc (BX.N) Private equity firms blocked withdrawals from a $69 billion real estate income trust (BREIT) in January as they faced a surge in redemption requests from investors looking to cash out.

BREIT said it processed about $1.3 billion in redemption claims in January. This represents 25% of the approximately $5.3 billion of total withdrawal requests received during the month. Withdrawal requests fulfilled also represent his 2% of the fund’s net asset value, according to the company.

Blackstone began exercising its right to block investor exits from the BREIT last November after a flood of requests exceeding a preset 5% of the fund’s net asset value.

Blackstone President Jonathan Gray said on an analyst earnings call last week that reimbursement demands are expected to remain elevated as Blackstone processes its backlog, but are expected to normalize over time. Blackstone shares fell 2.4% to $93.59 in Wednesday afternoon trading.

Last month, Blackstone announced that the University of California’s Invest $4 billion in BREIT shares After the company pledged $1 billion to boost returns to the university’s funds.

Meanwhile, Blackstone said Wednesday that BREIT Chairman and Chief Executive Officer Frank Cohen will hand over the role of global head of the Blackstone Core Plus Platform to Wesley LePatner.

(This story has been amended to change the total redemption amount in paragraph 2 from $5.5 billion to $5.3 billion)

Reported by Niket Nishant, Bangalore.Edited by Krishna Chandra Elli, Shinjini Ganguly and Diane Kraft

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