News & Analysis

Strategic Partners grows Fund VI to $3.2bn

Blackstone's secondaries group aims to raise at least $3.5bn for its latest fund, investments from which already include stakes in 3i and Ares funds.

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The Blackstone Group’s secondaries arm, Blackstone Strategic Partners, has raised $3.2 billion for its Fund VI, according to the publicly listed firm’s second quarter earnings report.

Fund VI has a $3.5 billion target and a $4.4 billion hard-cap. The fund had collected $1.5 billion as of April and raised an additional $1.7 billion during the second quarter. The fund launched last year and is expected to hold a final close by the end of August.

Limited partners in the fund include The Pennsylvania Public School Employees’ Retirement System, which committed $150 million in March, the Minnesota State Board of Investment and Copenhagen-based PFA Pension, according to PEI’s Research & Analytics division.

Fund VI acquired the State of Wisconsin Investment Board’s stake in 3i Eurofund III earlier this month and Bank of America Merrill Lynch’s position in Ares European Real Estate Fund III in March.

Blackstone Advisory Partners, Credit Suisse Securities, Park Hill Group and Merrill Lynch Pierce Fenner & Smith are listed in documents from the US Securities and Exchange Commission as firms that will receive sales compensation for the fundraise.

Blackstone Strategic Partners was created through the acquisition of Credit Suisse’s ‘Strategic Partners’ group, which the bank sold to Blackstone last August. Blackstone Strategic Partners is made up of a 29-person team focused on secondaries and headed by Stephen Can and Verdun Perry.

During the second quarter, Blackstone’s entire private equity division grew its assets under management from $66.14 billion to $68.29 billion. Meanwhile, the firm’s real estate group slimmed down from $81.33 billion to $80.41 billion but total assets under management grew by 3 percent to a record $279 billion.

Blackstone generated an economic net income—a measure of earnings that includes realised and unrealised investments—of $1.32 billion during the second quarter, compared to $703.2 million during the same period last year. All of the firm’s funds created $9.3 billion of value during the second quarter alone.