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Blackstone Inc.

Blackstone Inc.BXEarnings & Financial Report

NYSE · Financials · Asset Management & Custody Banks

Blackstone Inc. is an American alternative investment management company based in New York City. It was founded in 1985 as a mergers and acquisitions firm by Peter Peterson and Stephen Schwarzman, who had previously worked together at Lehman Brothers. Blackstone's private equity business has been one of the largest investors in leveraged buyouts in the last three decades, while its real estate business has actively acquired commercial real estate across the globe.

What changed in Blackstone Inc.'s 10-K — 2023 vs 2024

Top changes in Blackstone Inc.'s 2024 10-K

844 paragraphs added · 862 removed · 660 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

93 edited+15 added−26 removed96 unchanged
Risk Factors — Risks Related to Our Business — We may not have sufficient cash to pay back “clawback” obligations if and when they are triggered under the governing agreements with our investors.” In our structures other than carry funds, our Performance Revenues generally consist of performance-based allocations of a vehicle’s net capital appreciation during a measurement period, typically a year, subject to the achievement of minimum return levels, high water marks, loss carry forwards and/or other hurdle provisions, in accordance with the respective terms set out in each vehicle’s governing agreements.
Risk Factors — Risks Related to Our Business — We may not have sufficient cash to pay back “clawback” obligations if and when they are triggered under the governing agreements with our investors.” In our structures other than carry funds, our Performance Revenues generally consist of performance-based allocations of a vehicle’s net capital appreciation during a measurement period, subject to the achievement of minimum return levels, high water marks, loss carry forwards and/or other hurdle provisions, in accordance with the respective terms set out in each vehicle’s governing agreements.
If, at the end of the life of a carry fund (or earlier with respect to certain of our carry funds), as a result of diminished performance of later investments in a carry fund’s life, (a) the general partner receives in excess of the relevant carried interest percentage(s) applicable to the fund as applied to the fund’s 14 Table of Contents cumulative net profits over the life of the fund, or (in certain cases) (b) the carry fund has not achieved investment returns that exceed the preferred return threshold (if applicable), then we will be obligated to repay an amount equal to the carried interest that was previously distributed to us that exceeds the amounts to which we were ultimately entitled, up to the amount of carried interest received on an after-tax basis.
If, at the end of the life of a carry fund (or earlier with respect to certain of our carry funds), as a result of diminished performance of later investments in a carry fund’s life, (a) the general partner receives in excess of the relevant carried interest percentage(s) applicable to the fund as applied to the fund’s cumulative net profits over the life of the fund, or (in certain cases) (b) the carry fund has not achieved investment returns that exceed the preferred return threshold (if applicable), then we will be obligated to repay an amount equal to the carried interest that was previously distributed to us that exceeds the amounts to which we were ultimately entitled, up to the amount of carried interest received on an after-tax basis.
Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about Blackstone when you enroll your email address by visiting the “Contact Us/Email Alerts” section of our website at http://ir.blackstone.com.
Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about Blackstone when you enroll your email address by visiting the “Contact Us/E-mail Alerts” section of our website at http://ir.blackstone.com.
We have recorded a contingent repayment obligation equal to the amount that would be due on December 31, 2023, if the various carry funds were liquidated at their current carrying value. For additional information concerning the clawback obligations we could face, see “— Item 1A.
We have recorded a contingent repayment obligation equal to the amount that would be due on December 31, 2024, if the various carry funds were liquidated at their current carrying value. For additional information concerning the clawback obligations we could face, see “—Item 1A.
Similarly, we seek investments that can generate strong unlevered returns regardless of entry or exit cycle timing. BCEP pursues control-oriented investments in high-quality companies with durable businesses and seeks to offer a lower level of risk and a longer hold period than traditional private equity. 8 Table of Contents Tactical Opportunities pursues a thematically driven, opportunistic investment strategy.
Similarly, we seek investments that can generate strong unlevered returns regardless of entry or exit cycle timing. BCEP pursues control-oriented investments in high-quality companies with durable businesses and seeks to offer a lower level of risk and a longer hold period than traditional private equity. Tactical Opportunities pursues a thematically driven, opportunistic investment strategy.
Our compliance group also monitors contractual obligations that may be impacted and potential conflicts that may arise in connection with these inter-group discussions. 22 Table of Contents In addition, disclosure controls and procedures and internal controls over financial reporting are documented, tested and assessed for design and operating effectiveness in accordance with the U.S. Sarbanes-Oxley Act of 2002.
Our compliance group also monitors contractual obligations that may be impacted and potential conflicts that may arise in connection with these inter-group discussions. In addition, disclosure controls and procedures and internal controls over financial reporting are documented, tested and assessed for design and operating effectiveness in accordance with the U.S. Sarbanes-Oxley Act of 2002.
Our more than $1.0 trillion in Total Assets Under Management as of December 31, 2023 include global investment strategies focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets, secondaries and hedge funds. Our businesses use a solutions-oriented approach to drive better performance.
Our more than $1.1 trillion in Total Assets Under Management as of December 31, 2024 include global investment strategies focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets, secondaries and hedge funds. Our businesses use a solutions-oriented approach to drive better performance.
In recent years, capital from the private wealth channel has represented an increasing portion of our Total Assets Under Management, and we expect this trend to continue as we continue to undertake initiatives focused on this market segment. Investment Process and Risk Management We maintain a rigorous investment process across all of our investment vehicles.
In recent years, capital from the private wealth channel has represented an increasing portion of our Total Assets Under Management, and we expect this trend to continue as we continue to undertake initiatives focused on this market segment. 10 Table of Contents Investment Process and Risk Management We maintain a rigorous investment process across all our investment vehicles.
In addition, the governing agreements of some of our partnership funds provide that investors have the right to terminate the investment period for any reason by a supermajority vote of the investors in such fund. Fee Structure/Incentive Arrangements Management Fees The following is a general description of the management fees earned by Blackstone.
In addition, the governing agreements of some of our partnership funds provide that investors have the right to terminate the investment period for any reason by a supermajority vote of the investors in such fund. 12 Table of Contents Fee Structure/Incentive Arrangements Management Fees The following is a general description of the management fees earned by Blackstone.
We compete on the basis of a number of factors, including investment performance, transaction execution skills, access to capital, access to and retention of qualified personnel, reputation, range of products and services, innovation and price. 16 Table of Contents We face competition in the pursuit of institutional and individual investors for our investment funds.
We compete on the basis of a number of factors, including investment performance, transaction execution skills, access to capital, access to and retention of qualified personnel, reputation, range of products and services, innovation and price. We face competition in the pursuit of institutional and individual investors for our investment funds.
In addition, assets managed for certain of our insurance clients are Perpetual Capital assets under management. 10 Table of Contents Private Wealth Strategy Blackstone’s business historically focused on the provision of investment products, such as traditional drawdown funds, to institutional investors.
In addition, assets managed for certain of our insurance clients are Perpetual Capital assets under management. Private Wealth Strategy Blackstone’s business historically focused on the provision of investment products, such as traditional drawdown funds, to institutional investors.
Decreases in net asset value reduce the total management fee paid for the relevant period, but not the fee rate. 13 Table of Contents • In our CLOs, the investment adviser typically receives a base management fee and a subordinated management fee, which are calculated as a percentage of the CLO’s assets.
Decreases in net asset value reduce the total management fee paid for the relevant period, but not the fee rate. • In our CLOs, the investment adviser typically receives a base management fee and a subordinated management fee, which are calculated as a percentage of the CLO’s assets.
Tactical Opportunities’ ability to dynamically shift focus to the most compelling opportunities in any market environment, combined with the business’ expertise in structuring complex transactions, enables Tactical Opportunities to invest in attractive market areas, often with securities that provide downside protection and maintain upside return. Strategic Partners is a total fund solutions provider.
Tactical Opportunities’ ability to dynamically shift focus to the most compelling opportunities in any market environment, combined with the business’ expertise in structuring complex transactions, enables Tactical Opportunities to invest in attractive market areas, often with securities that provide downside protection and maintain upside return. 8 Table of Contents Strategic Partners is a total fund solutions provider.
The review committees and/or investment committees of our businesses review and evaluate investment opportunities in a framework that includes a qualitative and quantitative assessment of the key risks of investments. See “— Investment Process and Risk Management.” There are a number of pending or recently enacted legislative and regulatory initiatives that could significantly affect our business.
Further, the review committees and/or investment committees of our businesses review and evaluate investment opportunities in a framework that includes a qualitative and quantitative assessment of the key risks of investments. See “—Investment Process and Risk Management.” There are a number of pending or recently enacted legislative and regulatory initiatives that could significantly affect our business. Please see “—Item 1A.
Our investment funds, separately managed accounts and other vehicles not domiciled in the European Economic Area (the “EEA”) are each generally advised by a Blackstone entity serving as investment adviser that is registered under the U.S. Investment Advisers Act of 1940, as amended (the “Advisers Act”).
Our investment funds, SMAs and other vehicles not domiciled in the European Economic Area (the “EEA”) are each generally advised by a Blackstone entity serving as investment adviser that is registered under the U.S. Investment Advisers Act of 1940, as amended (the “Advisers Act”).
In addition, use our website (www.blackstone.com), Facebook page (www.facebook.com/blackstone), X (Twitter) (www.x.com/blackstone), LinkedIn (www.linkedin.com/company/blackstonegroup), Instagram (www.instagram.com/blackstone), SoundCloud (www.soundcloud.com/blackstone-300250613), PodBean (www.blackstone.podbean.com), Spotify (https://spoti.fi/2LJ1tHG), YouTube (www.youtube.com/user/blackstonegroup) and Apple Podcast (https://apple.co/31Pe1Gg) accounts as channels of distribution of company information. The information we post through these channels may be deemed material.
In addition, we may use our website (www.blackstone.com), Facebook page (www.facebook.com/blackstone), X (Twitter) (www.x.com/blackstone), LinkedIn (www.linkedin.com/company/blackstonegroup), Instagram (www.instagram.com/blackstone), SoundCloud (www.soundcloud.com/blackstone-300250613), Pandora (https://www.pandora.com/artist/blackstone/ARvlPz9Plblrlmg), PodBean (www.blackstone.podbean.com), Spotify (https://spoti.fi/2LJ1tHG and https://open.spotify.com/artist/52Eom8vQxM8Lk75ZZlf2hJ), YouTube (www.youtube.com/user/blackstonegroup) and Apple Podcast (https://apple.co/31Pe1Gg) accounts as channels of distribution of company information. The information we post through these channels may be deemed material.
For our investment funds, separately managed accounts and other vehicles domiciled in the EEA, a Blackstone entity domiciled in the EEA generally serves as external alternative investment fund manager (“AIFM”), and the AIFM typically delegates its portfolio management function to a Blackstone-affiliated investment adviser registered under the Advisers Act.
For our investment funds, SMAs and other vehicles domiciled in the EEA, a Blackstone entity domiciled in the EEA generally serves as external alternative investment fund manager (“AIFM”), and the AIFM typically delegates its portfolio management function to a Blackstone-affiliated investment adviser registered under the Advisers Act.
The contents of our website, any alerts and social media channels are not, however, a part of this report. 23 Table of Contents
The contents of our website, any alerts and social media channels are not, however, a part of this report.
Perpetual Capital Each of our business segments currently includes Perpetual Capital assets under management, which refers to assets under management with an indefinite term, that are not in liquidation and for which there is no requirement to return capital to investors through redemption requests in the ordinary course of business, except where funded by new capital inflows.
Perpetual Capital Each of our business segments currently includes Perpetual Capital assets under management, which refers to assets under management with an indefinite term, that are not in liquidation and for which there is no requirement to return capital to investors through redemption requests in the ordinary course of business, except where funded by new capital inflows or where required redemptions are limited in quantum.
Certain investment advisers are also registered with international regulators in connection with their management of products that are locally distributed and/or regulated. Blackstone Securities Partners L.P.
Certain investment advisers are also registered with international regulators in connection with their management of products that are locally distributed and/or regulated. 19 Table of Contents Blackstone Securities Partners L.P.
Blackstone Europe LLP (formerly known as Blackstone Group International Partners LLP) (“BELL”) acts as a sub-advisor to its Blackstone U.S. affiliates in relation to the investment and re-investment of Europe, Middle East and Africa (“EMEA”) based assets of Blackstone Funds, arranging transactions to be entered into by or on behalf of Blackstone Funds, and providing certain related services.
Blackstone Europe LLP (“BELL”) acts as a sub-advisor to its Blackstone U.S. affiliates in relation to the investment and re-investment of Europe, Middle East and Africa (“EMEA”) based assets of Blackstone Funds, arranging transactions to be entered into by or on behalf of Blackstone Funds, and providing certain related services.
BREP has made significant investments in logistics, rental housing, hospitality, office and retail properties around the world, as well as in a variety of real estate operating companies. Our Core+ real estate strategy invests in substantially stabilized real estate globally primarily through perpetual capital vehicles.
BREP has made significant investments in logistics, data centers, rental housing, hospitality, office and retail properties around the world, as well as in a variety of real estate operating companies. 7 Table of Contents Our Core+ real estate strategy invests in substantially stabilized real estate globally primarily through perpetual capital vehicles.
In addition, each of BXMT and BREIT conducts its operations in a manner that allows it to maintain its REIT qualification and avail itself of the statutory exemption provided by Section 3(c)(5)(C) of the 1940 Act and our U.S. BXPE vehicle relies on Section 3(c)(7) of the 1940 Act.
In addition, each of BXMT and BREIT conducts its operations in a manner that allows it to maintain its REIT qualification and avail itself of the statutory exemption provided by Section 3(c)(5)(C) of the 1940 Act and our U.S. BXPE and BXINFRA vehicles rely on the statutory exemption provided by Section 3(c)(7) of the 1940 Act.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.” For more information concerning the revenues and fees we derive from our business segments, see “— Fee Structure/Incentive Arrangements.” Real Estate Our Real Estate business is a global leader in real estate investing, with $336.9 billion of Total Assets Under Management as of December 31, 2023.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.” For more information concerning the revenues and fees we derive from our business segments, see “—Fee Structure/Incentive Arrangements.” Real Estate Our Real Estate business is a global leader in real estate investing, with $315.4 billion of Total Assets Under Management as of December 31, 2024.
In most of our Private Wealth Products, the investor’s capital is fully funded on the subscription date. Our BXCI insurance platform is generally structured around separately managed accounts and our BXCI CLO vehicles are generally private companies with limited liability.
In most of our Private Wealth Products, the investor’s capital is fully funded on the subscription date. Our BXCI insurance platform is generally structured around SMAs and our BXCI CLO vehicles are generally private companies with limited liability.
Investment vehicles in our Private Wealth Products typically have a board that includes independent directors. In the case of our separately managed accounts, the investor, rather than we, generally holds or has custody of the investments.
Investment vehicles in our Private Wealth Products typically have a board that includes independent directors. In the case of our SMAs, the investor, rather than we, generally holds or has custody of the investments.
To the extent our funds perform well, we can support a better retirement for tens of millions of pensioners, including teachers, nurses and firefighters. As of December 31, 2023, we employed approximately 4,735 people, including our 239 senior managing directors, at our headquarters in New York and around the world.
To the extent our funds perform well, we can support a better retirement for tens of millions of pensioners, including teachers, nurses and firefighters. As of December 31, 2024, we employed approximately 4,895 people, including our 254 senior managing directors, at our headquarters in New York and around the world.
Blackstone also supports its employee affinity networks in their efforts to expand cultural awareness and connection across the firm. In addition, the Blackstone Charitable Foundation (“BXCF”) was established in 2007 and is committed to supporting Blackstone’s goal of helping foster economic opportunity and career mobility for historically underrepresented groups.
Blackstone also supports its employee resource groups in their efforts to expand cultural awareness and connection across the firm. In addition, the Blackstone Charitable Foundation (“BXCF”) was established in 2007 and is committed to supporting Blackstone’s goal of helping foster economic opportunity and career mobility.
As of January 1, 2021, BEFM promotes Blackstone products and services in European countries where BELL is not otherwise licensed to do so. BEFM has branches in Paris, Milan and Frankfurt which provide marketing services and where distribution and deal sourcing individuals are based.
BEFM also promotes Blackstone products and services in European countries where BELL is not otherwise licensed to do so. BEFM has branches in Paris, Milan and Frankfurt which provide marketing services and where distribution and deal sourcing individuals are based.
To that end, our employee affinity networks, which are open to all employees, serve as a platform for our professionals to expand cultural awareness and connect to other employees, including through speaker series, professional development panels and social events.
To that end, our employee resource groups, which are open to all employees, serve as a platform for our professionals to expand cultural awareness and connect to other employees, including through speaker series, professional development opportunities and social events.
Our Core+ real estate strategy includes our (a) Blackstone Property Partners (“BPP”) funds, which is focused on high-quality assets in the Americas, Europe and Asia and (b) our non-listed REIT, Blackstone Real Estate Income Trust, Inc.
The strategy includes our (a) Blackstone Property Partners (“BPP”) funds, which are focused on high-quality assets in the Americas, Europe and Asia and (b) our non-listed real estate investment trust (“REIT”) Blackstone Real Estate Income Trust, Inc.
Our Private Wealth Products are organized using a variety of structures, including corporations, statutory trusts, limited partnerships or other vehicles, and accept subscriptions for investment from high-net-worth individuals and/or other individual investors.
These funds accept commitments and/or subscriptions for investment from institutional investors and/or high-net-worth individuals. Our Private Wealth Products are organized using a variety of structures, including 11 Table of Contents corporations, statutory trusts, limited partnerships or other vehicles, and accept subscriptions for investment from high-net-worth individuals and/or other individual investors.
Business Segments Our four business segments are: (a) Real Estate, (b) Private Equity, (c) Credit & Insurance and (d) Hedge Fund Solutions. Information about our business segments should be read together with “Part II. Item 7.
Business Segments Our four business segments are: (a) Real Estate, (b) Private Equity, (c) Credit & Insurance and (d) Multi-Asset Investing. Information about our business segments should be read together with “Part II. Item 7.
Our Private Equity segment includes our Corporate Private Equity business, which consists of: (a) our global private equity funds, Blackstone Capital Partners (“BCP”), (b) our sector-focused funds, including our energy- and energy transition-focused funds, Blackstone Energy Transition Partners (“BETP”), (c) our Asia-focused private equity funds, Blackstone Capital Partners Asia and (d) our core private equity funds, Blackstone Core Equity Partners (“BCEP”).
Our Corporate Private Equity business consists of: (a) our global private equity funds (Blackstone Capital Partners or “BCP”), (b) our sector-focused funds, including our energy- and energy transition-focused funds (Blackstone Energy Transition Partners or “BETP”), (c) our Asia-focused private equity funds (Blackstone Capital Partners Asia or “BCP Asia”) and (d) our core private equity funds (Blackstone Core Equity Partners or “BCEP”).
Depending on the investment, we face competition primarily from sponsors managing other funds, investment vehicles and other pools of capital, other financial institutions and institutional investors (including sovereign wealth and pension funds), corporate buyers and other parties.
We also face competition in the pursuit of attractive investment opportunities for our funds. Depending on the investment, we face competition primarily from sponsors managing other funds, investment vehicles and other pools of capital, other financial institutions and institutional investors (including sovereign wealth and pension funds), corporate buyers and other parties.
Investors in many of our funds also receive the opportunity to make additional “co-investments” with the investment funds. Our personnel, as well as Blackstone itself and certain Blackstone relationships, also have the opportunity to make investments, in or alongside our funds and other vehicles we manage, in some instances without being subject to management fees, carried interest or incentive fees.
Our personnel, as well as Blackstone itself and certain Blackstone relationships, also have the opportunity to make investments, in or alongside our funds and other vehicles we manage, in some instances without being subject to management fees, carried interest or incentive fees.
The private corporate credit strategies include mezzanine and direct lending funds, private placement strategies and stressed/distressed strategies. The direct lending funds include Blackstone Private Credit Fund (“BCRED”) and Blackstone Secured Lending Fund (“BXSL”), both of which are business development companies (“BDCs”). The liquid corporate credit strategies consist of CLOs, closed-ended funds, open-ended funds, systematic strategies and separately managed accounts.
The direct lending funds include Blackstone Private Credit Fund (“BCRED”) and Blackstone Secured Lending Fund (“BXSL”), both of which are business development companies (“BDCs”). The liquid corporate credit strategies consist of CLOs, closed-ended funds, open-ended funds, systematic strategies and SMAs.
The following is a general description of the Performance Revenues earned by Blackstone in structures other than carry funds: • In our Hedge Fund Solutions segment, the investment adviser of certain of our funds of hedge funds, hedge funds, separately managed accounts that invest in hedge funds and certain non-U.S. registered investment companies, is entitled to an incentive fee generally between 0% to 20%, as applicable, of the applicable investment vehicle’s net appreciation, subject to “high water mark” provisions and in some cases a preferred return. • The general partners or similar entities of each of our real estate and credit hedge fund structures receive incentive fees of generally up to 20% of the applicable fund’s net capital appreciation per annum. • The investment adviser of our BDCs receives (a) income incentive fees of 12.5% or 17.5%, as applicable, subject to, in certain cases, certain hurdles, catch-ups and caps, payable quarterly, and (b) capital gains incentive fees (net of realized and unrealized losses) of 12.5% or 17.5%, as applicable, payable annually. 15 Table of Contents • The investment manager of BXMT receives an incentive fee generally equal to 20% of BXMT’s distributable earnings in excess of a 7% per annum return on stockholders’ equity (excluding stock appreciation or depreciation), provided that BXMT’s distributable earnings over the prior three years is greater than zero. • The general partner or special limited partner of each of BREIT, BEPIF and BXPE receives a performance participation allocation of 12.5% of total return, subject to a 5% hurdle amount with a catch-up and recouping any loss carry forward amounts, measured annually and payable quarterly. • The general partners of certain open-ended BPP and BIP funds are entitled to an incentive fee allocation generally between 7% and 12.5% of net profit, subject to a hurdle amount generally of between 5.5% and 7%, a loss recovery amount and a catch-up.
Incentive allocations for these funds are generally realized every three years from when a limited partner makes its initial investment, or upon a limited partner’s redemption from the fund. • The general partner or special limited partner of each of BREIT, BEPIF, BXPE and BXINFRA receives a performance participation allocation of 12.5% of total return, subject to a 5% hurdle amount with a catch-up and recouping any loss carry forward amounts, measured annually and payable quarterly. • The investment adviser of our BDCs receives (a) income incentive fees of 12.5% or 17.5%, as applicable, subject to, in certain cases, certain hurdles, catch-ups and caps, payable quarterly, and (b) capital gains incentive fees (net of realized and unrealized losses) of 12.5% or 17.5%, as applicable, payable annually. • The general partners or similar entities of each of our real estate and credit hedge fund structures receive incentive fees of generally up to 20% of the applicable fund’s net capital appreciation per annum. • The investment manager of BXMT receives an incentive fee generally equal to 20% of BXMT’s distributable earnings in excess of a 7% per annum return on stockholders’ equity (excluding stock appreciation or depreciation), provided that BXMT’s distributable earnings over the prior three years is greater than zero. • In our Multi-Asset Investing segment, the investment adviser of certain of our funds of hedge funds, hedge or multi-strategy funds, separately managed accounts that invest in hedge funds and certain non-U.S. registered investment companies, is entitled to an incentive fee generally between 0% to 20%, as applicable, of the applicable investment vehicle’s net appreciation, subject to “high water mark” provisions and in some cases a preferred return.
Risk Factors — Risks Related to Our Business — The asset management business is intensely competitive.” Environmental, Social and Governance Our investors have relied on our relentless commitment to excellence for nearly 40 years. Our ESG efforts are anchored in our goal of generating strong returns for investors to fulfil our fiduciary duty.
Risk Factors — Risks Related to Our Business — The asset management business is intensely competitive.” 16 Table of Contents Sustainability Our investors have relied on our relentless commitment to excellence for nearly 40 years. Our sustainability efforts are anchored in our goal of generating strong returns for investors to fulfill our fiduciary duty.
Consequently, BELL can only provide investment services in certain EEA jurisdictions where it has obtained a domestic license on a cross-border services basis (currently, Belgium, Denmark, Finland and Italy), or can operate pursuant to an exemption or relief (currently Ireland, Lichtenstein and Norway), although in certain cases with limitations.
Accordingly, BELL can only provide investment services in certain EEA jurisdictions where it has obtained a domestic license on a cross-border services basis (currently, Belgium, Denmark, Finland, Spain and Italy), or can operate pursuant to an exemption or relief (currently Ireland, Liechtenstein and Norway). These operations are, however, in certain cases subject to limitations.
The infrastructure and asset based credit strategies include our energy strategies (including our sustainable resources platform) and asset based finance strategies focused on privately originated, income-oriented credit assets secured by physical or financial collateral. 9 Table of Contents Our insurance platform focuses on providing full investment management services for insurers’ general accounts, seeking to deliver customized and diversified portfolios that include allocations to Blackstone managed products and strategies across asset classes and Blackstone’s private credit origination capabilities.
The infrastructure and asset based credit strategies include energy strategies (including our sustainable resources platform) and asset based finance strategies focused on privately originated, income-oriented credit assets secured by physical, financial or residential real estate collateral. 9 Table of Contents Our insurance platform focuses on providing full investment management services for insurance and reinsurance accounts, seeking to deliver customized and diversified portfolios consisting primarily of investment grade credit, including through Blackstone’s private credit origination capabilities.
Such allocations are typically realized at the end of the measurement period and, once realized, are typically not subject to clawback or reversal. In particular, our ability to generate and realize these amounts is an important element of our business. Such allocations in certain of our Perpetual Capital strategies contribute a significant and growing portion to our overall revenues.
Such allocations are typically realized at the end of the measurement period and, once realized, are typically not subject to clawback or reversal. In particular, our ability to generate and realize these amounts is an important element of our business.
Among the strategies in each of our segments, Perpetual Capital strategies include, without limitation, (a) in our Real Estate segment, Core+ real estate (including BREIT and BEPIF) and BXMT, (b) in our Private Equity segment, BIP and BXPE, (c) in our Credit & Insurance segment, BXSL and BCRED and (d) in our Hedge Fund Solutions segment, GP Stakes.
Perpetual Capital strategies include, without limitation, (a) in our Real Estate segment, Core+ real estate (including BREIT and BEPIF) and BXMT, (b) in our Private Equity segment, BIP, BXPE, BXINFRA and vehicles in GP Stakes, and (c) in our Credit & Insurance segment, BXSL and BCRED.
During 2023, our total number of employees increased by approximately 40. Our board of directors plays an active role in overseeing our human capital management efforts. To that end, senior management reviews with our board of directors management succession planning and development and other key aspects of our talent management strategy.
Our board of directors plays an active role in reviewing our human capital management efforts. To that end, senior management reviews with our board of directors management succession planning and development and other key aspects of our talent management strategy.
BEFM provides investment management functions including portfolio management, risk management, administration, marketing and related activities to the assets of its alternative investment funds, in accordance with the AIFM Law and the regulatory provisions imposed by the Commission de Surveillance du Secteur Financier in Luxembourg. BEFM may also manage undertakings for collective investment in transferable securities (UCITS).
BEFM provides investment management functions including portfolio management, risk management, 20 Table of Contents administration, marketing and related activities to its managed funds, in accordance with the AIFM Law, UCITS Law and the regulatory provisions imposed by the Commission de Surveillance du Secteur Financier in Luxembourg.
We encourage independent thinking and reward initiative while providing training and development opportunities to help our employees grow professionally. In addition, our Respect at Work programs and trainings help maintain an inclusive work environment in which all individuals are treated with respect and dignity. Employee education and training are also critical to maintaining a culture of compliance.
In addition, our Respect at Work programs and trainings help maintain an inclusive work environment in which all individuals are treated with respect and dignity. Employee education and training are also critical to maintaining a culture of compliance.
Risk Factors — Risks Related to Our Business — Financial regulatory changes in the United States could adversely affect our business” and “— Complex regulatory regimes and potential regulatory changes in jurisdictions outside the United States could adversely affect our business.” Available Information, Website and Social Media Disclosure We file annual, quarterly and current reports and other information with the SEC.
The possibility of increased regulatory focus, could result in additional burdens on our business” and “—Complex regulatory regimes and potential regulatory changes in jurisdictions outside the United States could adversely affect our business.” Available Information, Website and Social Media Disclosure We file annual, quarterly and current reports and other information with the SEC.
Internal Audit, which independently reports to the audit committee of our board of directors, operates with a global mandate and is responsible for the examination and evaluation of the adequacy and effectiveness of the organization’s governance and risk management processes and internal controls, as well as the quality of performance in carrying out assigned responsibilities to achieve the organization’s stated goals and objectives.
Internal Audit, which independently reports to the audit committee of our board of directors, operates with a global mandate and is responsible for the examination and evaluation of the adequacy and effectiveness of the organization’s governance and risk management processes and internal controls.
Our senior management periodically reviews the effectiveness and competitiveness of our compensation program. Most of our current senior managing directors and other senior personnel have equity interests in our business that entitle such personnel to cash distributions. See “Part III. Item 11.
Most of our current senior managing 18 Table of Contents directors and other senior personnel have equity interests in our business that entitle such personnel to cash distributions. See “Part III. Item 11.
We believe building inclusive workplaces positions us and our portfolio companies to access a broad pool of qualified talent, including from historically under-tapped talent pools, and foster inclusive cultures that generate lasting value for our investors. See “— Human Capital Management.” Human Capital Management Blackstone’s employees are integral to our culture of integrity, professionalism, excellence and cooperation.
We believe building inclusive workplaces positions us and our portfolio companies to access a broad pool of qualified talent, including from historically under-tapped talent pools, and foster inclusive cultures that generate lasting value for our investors.
Nearly 90% of our employees engaged globally with BXCF’s charitable initiatives in 2023. 18 Table of Contents Talent Acquisition, Development and Retention We believe the talent of our employees, coupled with our rigorous investment process, has supported our excellent investment record over many years. We are therefore focused on hiring, training, motivating and retaining talented individuals.
Nearly 90% of our employees engaged globally with BXCF’s charitable initiatives in 2024. 17 Table of Contents Talent Acquisition, Development and Retention We believe the talent of our employees, coupled with our rigorous investment process, has supported our excellent investment record over many years.
Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies — Revenue Recognition — Management and Advisory Fees, Net.” Incentive Arrangements Our incentive arrangements are composed of (a) contractual incentive fees received from certain investment vehicles upon achieving specified cumulative investment returns (“Incentive Fees”), and (b) a disproportionate allocation of the income generated by investment vehicles otherwise allocable to investors upon achieving certain investment returns (“Performance Allocations”, and, together with Incentive Fees, “Performance Revenues”).
Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies — Revenue Recognition — Management and Advisory Fees, Net.” Incentive Arrangements Our incentive arrangements are composed of (a) contractual incentive fees received from certain investment vehicles upon achieving specified cumulative investment returns (“Incentive Fees”), and (b) a disproportionate allocation of the income generated by investment vehicles otherwise allocable to investors upon achieving certain investment returns (“Performance Allocations”, and, together with Incentive Fees, “Performance Revenues”). 13 Table of Contents In our carry funds, our Performance Revenues consist of the Performance Allocations to which the general partner or an affiliate thereof is entitled, commonly referred to as carried interest.
Our Credit & Insurance segment’s research team monitors the operating performance of underlying issuers, while portfolio managers, together with our traders, focus on optimizing asset composition to maximize value for our investors.
Our Credit & Insurance segment’s research team monitors the operating performance of underlying issuers, while portfolio managers, together with our traders, focus on optimizing asset composition to maximize value for our investors. This investment process is assisted by a variety of proprietary and non-proprietary research models and methods.
Data privacy is typically addressed in the Global Head of Compliance’s annual update to our board of directors. Blackstone’s approach to data protection is set out in our Online Privacy Notice and its Investor Data Privacy Notice.
We provide data privacy training at onboarding to new employees and at least annually to existing employees. Data privacy is typically addressed in the Global Head of Compliance’s annual update to our board of directors. Blackstone’s approach to data privacy is set out in our Online Privacy Notice and Investor Data Privacy Notice.
We determine whether to make general partner capital commitments to our funds in excess of the minimum required commitments based on, among other things, our anticipated liquidity, working capital and other capital needs. In many cases, we require our senior managing directors and other professionals to fund a portion of the general partner capital commitments to our funds.
We determine whether to make general partner capital commitments to our funds in excess of the minimum required commitments based on, among other things, our anticipated liquidity, working capital and 15 Table of Contents other capital needs.
BREDS’ scale and investment mandates enable it to provide a variety of lending options for our borrowers and investment options for our investors, including commercial real estate and mezzanine loans, residential mortgage loan pools and liquid real estate-related debt securities. The BREDS platform includes high-yield real estate debt funds, liquid real estate debt funds and Blackstone Mortgage Trust, Inc.
BREDS’ scale and investment mandates enable it to provide a variety of lending options for our borrowers and investment options for our investors, including commercial real estate and mezzanine loans and liquid real estate-related debt securities.
In other cases, we may from time to time offer to our senior managing directors and employees a part of the funded or unfunded general partner commitments to our investment funds. Our general partner capital commitments are funded with cash and not with carried interest or deferral of management fees.
In many cases, we require our senior managing directors and other professionals to fund a portion of the general partner capital commitments to our funds. In other cases, we may from time to time offer to our senior managing directors and employees a part of the funded or unfunded general partner commitments to our investment funds.
To further align their interests with those of investors in our funds, we provide employees with the opportunity to make investments in or alongside certain of the funds and other vehicles we manage.
To further align their interests with those of investors in our funds, we provide employees with the opportunity to make investments in or alongside certain of the funds and other vehicles we manage. We also provide our employees and their families robust health and wellbeing offerings, including time-off options and family planning resources.
Blackstone Ireland Fund Management Limited (formerly known as Blackstone / GSO Debt Funds Management Europe II Limited) (“BIFM”) is authorized and regulated by the CBI as an Alternative Investment Fund Manager under the (Irish) European Union (Alternative Investment Fund Managers Regulations) 2013 (“AIFMRs”), which largely implements the EU Alternative Investment Fund Managers Directive (“AIFMD”) in Ireland.
Blackstone Ireland Fund Management Limited (“BIFM”) is authorized and regulated by the CBI as an Alternative Investment Fund Manager under the (Irish) European Union (Alternative Investment Fund Managers Regulations) 2013 (“AIFMRs”).
In addition, as reflected in this Annual Report on Form 10-K, our Hedge Fund Solutions segment also includes our GP stakes business (“GP Stakes”), which targets minority investments in the general partners of private equity and other private market alternative asset management firms globally, with a focus on delivering a combination of recurring annual cash flow yield and long-term capital appreciation.
GP Stakes targets minority investments in the general partners of private equity and other private market alternative asset management firms globally, with a focus on delivering a combination of recurring annual cash flow yield and long-term capital appreciation.
The BREP platform includes global funds as well as funds focused specifically on Europe or Asia investments. BREP seeks to invest thematically in high-quality assets, focusing where we see outsized growth potential driven by global economic and demographic trends.
BREP seeks to invest thematically in high-quality assets, focusing where we see outsized growth potential driven by global economic and demographic trends.
The investment portfolios of the funds BXCI’s credit platform manages or sub-advises consist primarily of loans and securities of non-investment and investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity. BXCI is organized into three overarching credit investing strategies: private corporate credit, liquid corporate credit and infrastructure and asset based credit.
BXCI is one of the largest credit managers and CLO managers in the world. The investment portfolios BXCI’s credit platform manages or sub-advises consist primarily of loans and securities of non-investment and investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity.
Through this platform, we provide our clients tailored portfolio construction and strategic asset allocation, seeking to generate risk-managed, capital-efficient returns, diversification and capital preservation that meets clients’ objectives. We also provide similar services to clients through separately managed accounts or by sub-managing assets for certain insurance-dedicated funds and special purpose vehicles.
Through this platform, we provide our clients tailored portfolio construction, strategic asset allocation, and specialized analytical tools. While focusing on policyholder protection, we seek to achieve risk-managed, liability-matched and capital-efficient returns, as well as diversification and capital preservation. We also provide similar services to clients through SMAs or by sub-managing assets for certain insurance-dedicated funds and special purpose vehicles.
Across all our businesses, we face intense competition for qualified personnel. We seek to attract and retain the brightest minds across a wide spectrum of disciplines and from varied backgrounds and experiences. We believe our reputation, talent development opportunities and compensation make us an attractive employer.
We seek to attract and retain the brightest minds across a wide spectrum of disciplines and from varied backgrounds and experiences. We believe our reputation, talent development opportunities and compensation make us an attractive employer. We encourage independent thinking and reward initiative while providing training and development opportunities to help our employees grow professionally.
In recent years, we have considerably expanded the number and type of investment products we offer through various distribution channels to certain high-net-worth and mass affluent individual investors in the U.S. and other jurisdictions around the world.
Blackstone’s business now also includes a substantial number of investment products that are offered through various distribution channels to certain high-net-worth and mass affluent individual investors in the U.S. and other jurisdictions around the world. We expect to continue to expand the number and type of such products that we offer.
However, additional legislation, changes in rules promulgated by financial regulatory authorities or self-regulatory organizations or changes in the interpretation or enforcement of existing laws and rules, either in the United States or abroad, may directly affect our mode of operation and profitability. 20 Table of Contents All of the investment advisers of our investment funds operating in the U.S. are registered as investment advisers with the SEC under the Advisers Act (other investment advisers may be registered in non-U.S. jurisdictions).
However, additional legislation, changes in rules promulgated by financial regulatory authorities or self-regulatory organizations or changes in the interpretation or enforcement of existing laws and rules, either in the United States or abroad, may directly affect our mode of operation and profitability.
Many of our businesses are subject to compliance with laws and regulations of U.S. federal and state governments, non-U.S. governments, their respective agencies and/or various self-regulatory organizations or exchanges.
Regulatory and Compliance Matters Our businesses, as well as the financial services industry generally, are subject to extensive regulation in the United States and in many of the markets in which we operate. Our business is subject to compliance with laws and regulations of U.S. federal and state governments, non-U.S. governments, their respective agencies and/or various self-regulatory organizations or exchanges.
Our Real Estate segment operates as one globally integrated business with approximately 870 employees and has investments across the globe, including in the Americas, Europe and Asia.
Our Real Estate segment operates as one globally integrated business with approximately 835 employees and has investments across the globe, including in the Americas, Europe and Asia. Our real estate investment teams seek to utilize our global expertise and presence to generate attractive risk-adjusted returns for our investors.
Our private investment funds are generally organized as limited partnerships with respect to U.S. domiciled vehicles and limited partnerships or other similar limited liability entities with respect to non-U.S. domiciled vehicles. These funds accept commitments and/or subscriptions for investment from institutional investors and/or high-net-worth individuals.
We also have several products that are targeted at individual investors, including high-net-worth investors (“Private Wealth Products”). Our private investment funds are generally organized as limited partnerships with respect to U.S. domiciled vehicles and limited partnerships or other similar limited liability entities with respect to non-U.S. domiciled vehicles.
(“BXMT”), a NYSE-listed real estate investment trust (“REIT”). Private Equity Our Private Equity segment encompasses global businesses with a total of approximately 625 employees managing $304.0 billion of Total Assets Under Management as of December 31, 2023.
Private Equity Our Private Equity segment encompasses global businesses with a total of approximately 675 employees managing $352.2 billion of Total Assets Under Management as of December 31, 2024.
Senior management reports to the audit committee of the board of directors on the agenda of risk topics evaluated by the enterprise risk committee and provides periodic risk reports, a summary of its view on key risks to the firm and detailed assessments of selected risks, as applicable.
Senior management reports to the audit committee of the board of directors on the agenda of risk topics evaluated by the enterprise risk committee and provides periodic risk reports, a summary of key risks to the firm, and detailed assessments of selected risks, as applicable. 21 Table of Contents Additionally, our firmwide valuation committee reviews the valuation process for investments held by us and our investment vehicles, including the application of appropriate valuation standards on a consistent basis.
In addition, the majority of our businesses have ESG policies that address, among other things, the review of ESG risks in the respective business’s investment process. Existing investments are reviewed and monitored on a regular basis by investment and asset management professionals.
In addition, certain of our business units maintain their own sustainability policies that address, among other things, sustainability factors applicable to their respective investment strategies. Existing investments are reviewed and monitored on a regular basis by investment and asset management professionals.
This investment process is assisted by a variety of proprietary and non-proprietary research models and methods. 11 Table of Contents Structure and Operation of Our Investment Vehicles Our asset management businesses include private investment funds, registered funds, BDCs, REITs, CLOs, SMAs and other vehicles focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets and secondary funds, all on a global basis.
Structure and Operation of Our Investment Vehicles Our asset management businesses include private investment funds, registered funds, BDCs, REITs, CLOs, SMAs and other vehicles focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets and secondary funds. Many of our private investment funds and other vehicles are targeted at institutional investors.
We believe a workforce reflecting a breadth of backgrounds and experiences makes us better investors and a better firm. Our diversity, equity and inclusion strategy leverages a people-driven framework based on four key pillars: recruiting, talent development, community and inclusion and accountability.
Our talent strategy leverages a people-driven framework based on four key pillars: recruiting, talent development, community and inclusion, and accountability.
In our carry funds, our Performance Revenues consist of the Performance Allocations to which the general partner or an affiliate thereof is entitled, commonly referred to as carried interest. Our ability to generate and realize carried interest is an important element of our business and has historically accounted for a very significant portion of our income.
Our ability to generate and realize carried interest is an important element of our business and has historically accounted for a very significant portion of our income. Carried interest is typically structured as a net profits interest in the applicable fund.
BXPE invests primarily in privately negotiated, equity-oriented investments, leveraging Blackstone’s private equity talent and investment capabilities to create an attractive portfolio of alternative investments diversified across geographies and sectors. Credit & Insurance Our Credit & Insurance segment has approximately 640 employees and manages $318.9 billion of Total Assets Under Management as of December 31, 2023.
BXPE invests primarily in privately negotiated, equity-oriented investments, leveraging Blackstone’s private equity talent and investment capabilities to create an attractive portfolio of alternative investments diversified across geographies and sectors. BXINFRA invests primarily in infrastructure equity, secondaries and credit strategies, leveraging Blackstone’s infrastructure talent and investment capabilities to create an attractive portfolio of alternative infrastructure investments.
With respect to the private wealth channel and insurance sector, the market for capital is highly competitive, requires significant investment and is highly regulated, which could create competitive challenges for us. We also face competition in the pursuit of attractive investment opportunities for our funds.
In the private wealth and insurance channels, the market for capital is highly competitive, requires significant investment and is highly regulated, which could create competitive challenges for us. In the private wealth channel, the willingness of our competitors to pay higher or differing types of distributor fees increases competition for fundraising.
In addition, before deciding to invest in an investment fund or an alternative asset manager, as applicable, our Hedge Fund Solutions and Strategic Partners teams conduct diligence in a number of areas, which, depending on the nature of the investment, may include, among others, the fund’s/manager’s performance, investment terms, investment strategy and investment personnel, as well as its operations, processes, risk management and internal controls.
Depending on the nature of the investment, these areas may include, among others, the fund’s/manager’s performance, investment terms, investment strategy and investment personnel, as well as its operations, processes, risk management and internal controls.
Senior management oversees privacy, data protection and information risk management efforts, leading the privacy and data protection function, which conducts privacy impact assessments, implements privacy-by-design initiatives and reconciles global privacy programs with local privacy requirements. Our privacy function also supports the Data Protection Operating Committee, Blackstone’s global privacy compliance steering committee. Please see “— Part I, Item 1C.
Our privacy function, which involves conducting privacy impact assessments, implementing privacy-by-design initiatives and reconciling global privacy programs with local privacy requirements, is led by our Data and Policy Strategy Officer and overseen by the Data Protection Operating Committee, Blackstone’s global privacy compliance steering committee. Please see “—Item 1C. Cybersecurity” for a discussion of our cybersecurity risk management, strategy and governance.
Our Private Equity segment also includes (a) our opportunistic investment platform that invests flexibly across asset classes, industries and geographies, Blackstone Tactical Opportunities (“Tactical Opportunities”), (b) our secondary fund business, Strategic Partners Fund Solutions (“Strategic Partners”), (c) our infrastructure-focused funds, Blackstone Infrastructure Partners (“BIP”), (d) our life sciences investment platform, Blackstone Life Sciences (“BXLS”), (e) our growth equity investment platform, Blackstone Growth (“BXG”), (f) our investment platform offering eligible individual investors access to Blackstone’s private equity capabilities, Blackstone Private Equity Strategies Fund (“BXPE”), (g) our multi-asset investment program for eligible high-net-worth investors offering exposure to certain of Blackstone’s key illiquid investment strategies through a single commitment, Blackstone Total Alternatives Solution (“BTAS”) and (h) our capital markets services business, Blackstone Capital Markets (“BXCM”).
Our Private Equity Strategies include: (a) our Corporate Private Equity business (described below), (b) our opportunistic investment platform that invests flexibly across asset classes, industries and geographies (Blackstone Tactical Opportunities or “Tactical Opportunities”), (c) our life sciences investment platform (Blackstone Life Sciences or “BXLS”), (d) our growth equity investment platform (Blackstone Growth or “BXG”) and (e) a private wealth-focused platform offering eligible individual investors access to Blackstone’s private equity capabilities (Blackstone Private Equity Strategies Fund or “BXPE”).

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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As publicly traded equity securities have in recent years represented meaningful proportion of the assets of many of our funds, stock market volatility, including a sharp decline in the stock market, may adversely affect our results, including our revenues and net income.
As publicly traded equity securities have in recent years represented a meaningful proportion of the assets of many of our funds, stock market volatility, including a sharp decline in the stock market, may adversely affect our results, including our revenues and net income.
Our asset management business competes with a number of private funds, specialized investment funds, funds structured for individual investors, hedge funds, funds of hedge funds and other sponsors managing pools of capital, as well as corporate buyers, traditional asset managers, commercial banks, investment banks and other financial institutions (including sovereign wealth funds), and we expect that competition will continue to increase.
Our asset management business competes with a number of private funds, specialized investment funds, funds structured for individual investors, hedge funds, funds of hedge funds and other sponsors managing pools of capital, as well as corporate buyers, traditional asset managers, commercial banks, investment banks and other financial institutions (including sovereign wealth funds). We expect that competition will continue to increase.
The terms of any such existing and future co-investment vehicles may differ materially, and in some instances may be more favorable to us, than the terms of certain of our funds or prior co-investment vehicles, and such different terms may create an incentive for us to allocate a greater or lesser percentage of an investment opportunity to such co-investment vehicles.
The terms of any such existing and future co-investment vehicles may differ materially, and in some instances may be more favorable to us, than the terms of certain of our funds or prior co-investment vehicles. Such different terms may create an incentive for us to allocate a greater or lesser percentage of an investment opportunity to such co-investment vehicles.
Changes in values of investments from quarter to quarter may result in volatility in our investment funds’ net asset value, our investment in, or fees from, those funds and the results of operations and cash flow that we report from period to period.
Changes in values of investments from quarter to quarter may result in volatility in our investment funds’ net asset value, our funds’ investment in, or fees from, those funds and the results of operations and cash flow that we report from period to period.
Any of the foregoing circumstances could have a material adverse effect on our financial condition, results of operations and cash flow. The due diligence process that we undertake in connection with investments by our investment funds may not reveal all facts and issues that may be relevant in connection with an investment.
Any of the foregoing circumstances could have a material adverse effect on our financial condition, results of operations and cash flow. The due diligence process that we undertake in connection with investments by our funds may not reveal all facts and issues that may be relevant in connection with an investment.
As a result, we do not have the ability to control the investment activities of such funds, including with respect to the selection of investment opportunities, any deviation from stated or expected investment strategy, the liquidation of positions and the use of leverage to finance the purchase of investments, each of which may impact our ability to generate a successful return on our investment in such underlying fund. • Hedge funds may engage in speculative trading strategies, including short selling, which is subject to the theoretically unlimited risk of loss because there is no limit on how much the price of a security may appreciate before the short position is closed out.
As a result, we do not have the ability to control the investment activities of such funds, including with respect to the selection of investment opportunities, any deviation from stated or expected investment strategy, the liquidation of positions and the use of leverage to finance the purchase of investments, each of which may impact our ability to generate a successful return on our fund’s investment in such underlying fund. • Hedge funds may engage in speculative trading strategies, including short selling, which is subject to the theoretically unlimited risk of loss because there is no limit on how much the price of a security may appreciate before the short position is closed out.
If we fail to deliver high-quality, high-performing products and strategies that help our insurance company clients meet long-term policyholder obligations, we may not be successful in retaining existing investment partnerships, developing new investment partnerships or originating or selling capital-efficient assets or products and such failure may have a material adverse effect on our business, results and financial condition.
If we fail to deliver or originate high-quality, high-performing products, strategies or assets that help our insurance company clients meet long-term policyholder obligations, we may not be successful in retaining existing investment partnerships, developing new investment partnerships or originating or selling capital-efficient assets or products. Such failure may have a material adverse effect on our business, results and financial condition.
Further, through its ability to elect our board of directors, the Series II Preferred Stockholder has the ability to indirectly influence the determination of the amount and timing of our investments and dispositions, cash expenditures, indebtedness, issuances of additional partnership interests, tax liabilities and amounts of reserves, each of which can affect the amount of cash that is available for distribution to holders of Blackstone Holdings Partnership Units.
Further, through its ability to elect our board of directors, the Series II Preferred Stockholder has the ability to indirectly influence the determination of the amount and timing of our funds’ investments and dispositions, cash expenditures, indebtedness, issuances of additional partnership interests, tax liabilities and amounts of reserves, each of which can affect the amount of cash that is available for distribution to holders of Blackstone Holdings Partnership Units.
Similarly, certain of our vehicles’ terms require an offset of Performance Revenues related to past performance, often referred to as a “recoupment of loss carryforward.” If a recoupment of loss carryforward is triggered, including as a result of a meaningful decline in the vehicles’ revenues following a period of strong performance, such offset would serve to reduce the amount of future Performance Revenues to which we would be entitled in such vehicle.
Similarly, certain of our vehicles’ terms require an offset of Performance Revenues related to past performance, often referred to as a “recoupment of loss carryforward.” If a recoupment of loss carryforward is triggered, including as a result of a meaningful decline in the vehicle’s revenues following a period of strong performance, such offset would serve to reduce the amount of future Performance Revenues to which we would be entitled in such vehicle.
For example, • Ownership of infrastructure assets may present risk of liability for personal and property injury or impose significant operating challenges and costs with respect to, for example, compliance with zoning, environmental or other applicable laws. 67 Table of Contents • Infrastructure asset investments may face construction risks including, without limitation: (a) labor disputes, shortages of material and skilled labor, or work stoppages, (b) slower than projected construction progress and the unavailability or late delivery of necessary equipment, (c) less than optimal coordination with public utilities in the relocation of their facilities, (d) adverse weather conditions and unexpected construction conditions, (e) accidents or the breakdown or failure of construction equipment or processes, and (f) catastrophic events such as explosions, fires, terrorist attacks and other similar events.
For example, • Ownership of infrastructure assets may present risk of liability for personal and property injury or impose significant operating challenges and costs with respect to, for example, compliance with zoning, environmental or other applicable laws. 66 Table of Contents • Infrastructure asset investments may face construction risks including, without limitation: (a) labor disputes, shortages of material and skilled labor, or work stoppages, (b) slower than projected construction progress and the unavailability or late delivery of necessary equipment, (c) less than optimal coordination with public utilities in the relocation of their facilities, (d) adverse weather conditions and unexpected construction conditions, (e) accidents or the breakdown or failure of construction equipment or processes, and (f) catastrophic events such as explosions, fires, terrorist attacks and other similar events.
In addition, our certificate of incorporation provides voting rights to holders of our common stock on the following additional matters: • A sale, exchange or disposition of all or substantially all of our assets, • A merger, consolidation or other business combination, • Any amendment of our certificate of incorporation or bylaws enlarging the obligations of the common stockholders, • Any amendment of our certificate of incorporation requiring the vote of the holders of a percentage of the voting power of the outstanding common stock and Series I preferred stock, voting together as a single class, to take any action in a manner that would have the effect of reducing such voting percentage and • Any amendments of our certificate of incorporation that are not included in the specified set of amendments that the Series II Preferred Stockholder has the sole right to vote on. 73 Table of Contents Furthermore, our certificate of incorporation provides that the holders of at least 66 2/3% of the voting power of the outstanding shares of common stock and Series I preferred stock may vote to require the Series II Preferred Stockholder to transfer its shares of Series II preferred stock to a successor Series II Preferred Stockholder designated by the holders of at least a majority of the voting power of the outstanding shares of common stock and Series I preferred stock.
In addition, our certificate of incorporation provides voting rights to holders of our common stock on the following additional matters: • A sale, exchange or disposition of all or substantially all of our assets, • A merger, consolidation or other business combination, • Any amendment of our certificate of incorporation or bylaws enlarging the obligations of the common stockholders, • Any amendment of our certificate of incorporation requiring the vote of the holders of a percentage of the voting power of the outstanding common stock and Series I preferred stock, voting together as a single class, to take any action in a manner that would have the effect of reducing such voting percentage and • Any amendments of our certificate of incorporation that are not included in the specified set of amendments that the Series II Preferred Stockholder has the sole right to vote on. 72 Table of Contents Furthermore, our certificate of incorporation provides that the holders of at least 66 2/3% of the voting power of the outstanding shares of common stock and Series I preferred stock may vote to require the Series II Preferred Stockholder to transfer its shares of Series II preferred stock to a successor Series II Preferred Stockholder designated by the holders of at least a majority of the voting power of the outstanding shares of common stock and Series I preferred stock.
We are not required to file proxy statements or information statements under Section 14 of the Exchange Act except in circumstances where a vote of holders of our common stock is required under our certificate of incorporation or Delaware law, such as a merger, business combination or sale of all or substantially all of our assets.
Moreover, we are not required to file proxy statements or information statements under Section 14 of the Exchange Act except in circumstances where a vote of holders of our common stock is required under our certificate of incorporation or Delaware law, such as a merger, business combination or sale of all or substantially all of our assets.
New statutory accounting guidance or changes or clarifications in interpretations of existing guidance may adversely impact our ability to originate, or invest in, such assets on behalf of our insurance company clients or cause our clients to increase their required capital in respect of such assets, thus making such assets less attractive to insurers, which may adversely affect our business.
New statutory accounting guidance or changes or clarifications in interpretations of existing guidance may adversely impact our ability to originate, or invest in, appropriate assets on behalf of our insurance company clients or cause our clients to increase their required capital in respect of such assets, thus making such assets less attractive to insurers, which may adversely affect our business.
Infrastructure investments may involve the subcontracting of design and construction activities in respect of projects, and as a result our investments are subject to the risks that contractual provisions passing liabilities to a subcontractor could be ineffective, the subcontractor fails to perform services which it has agreed to perform and the subcontractor becomes insolvent.
Infrastructure investments may involve the subcontracting of design and construction activities in respect of projects, and as a result our funds’ investments are subject to the risks that contractual provisions passing liabilities to a subcontractor could be ineffective, the subcontractor fails to perform services which it has agreed to perform and the subcontractor becomes insolvent.
As a result, a stockholder may have his or her shares of common stock purchased from him or her at an undesirable time or price and in a manner which adversely affects the ability of a stockholder to participate in further growth in our stock price. 80 Table of Contents Our amended and restated bylaws designate the Court of Chancery of the State of Delaware or the federal district courts of the United States of America, as applicable, as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with Blackstone or our directors, officers or other employees.
As a result, a stockholder may have his or her shares of common stock purchased from him or her at an undesirable time or price and in a manner which adversely affects the ability of a stockholder to participate in further growth in our stock price. 79 Table of Contents Our amended and restated bylaws designate the Court of Chancery of the State of Delaware or the federal district courts of the United States of America, as applicable, as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with Blackstone or our directors, officers or other employees.
Investments in non-U.S. securities involve certain factors not typically associated with investing in U.S. securities, including risks relating to: • currency exchange matters, including fluctuations in currency exchange rates and costs associated with conversion of investment principal and income from one currency into another, • less developed or efficient financial markets than in the United States, which may lead to potential price volatility and relative illiquidity, • the absence of uniform accounting, auditing and financial reporting standards, practices and disclosure requirements and less government supervision and regulation, • changes in laws or clarifications to existing laws that could impact our tax treaty positions, which could adversely impact the returns on our investments, • a less developed legal or regulatory environment, differences in the legal and regulatory environment or enhanced legal and regulatory compliance, • heightened exposure to corruption risk in certain non-U.S. markets, • political hostility to investments by foreign or private equity investors, • reliance on a more limited number of commodity inputs, service providers and/or distribution mechanisms, • more volatile or challenging market or economic conditions, including higher rates of inflation, • higher transaction costs, • difficulty in enforcing contractual obligations, • fewer investor protections and less publicly available information about companies, • certain economic and political risks, including potential exchange control regulations and restrictions on our non-U.S. investments and repatriation of profits on investments or of capital invested, the risks of war, terrorist attacks, political, economic or social instability, the possibility of expropriation or confiscatory taxation and adverse economic and political developments and • the possible imposition of non-U.S. taxes or withholding on income and gains recognized with respect to such securities.
Investments in non-U.S. securities involve certain factors not typically associated with investing in U.S. securities, including risks relating to: • currency exchange matters, including fluctuations in currency exchange rates and costs associated with conversion of investment principal and income from one currency into another, • less developed or efficient financial markets than in the United States, which may lead to potential price volatility and relative illiquidity, • the absence of uniform accounting, auditing and financial reporting standards, practices and disclosure requirements and less government supervision and regulation, • changes in laws or clarifications to existing laws that could impact our tax treaty positions, which could adversely impact the returns on our funds’ investments, • a less developed legal or regulatory environment, differences in the legal and regulatory environment or enhanced legal and regulatory compliance, • heightened exposure to corruption risk in certain non-U.S. markets, • political hostility to investments by foreign or private equity investors, • reliance on a more limited number of commodity inputs, service providers and/or distribution mechanisms, • more volatile or challenging market or economic conditions, including higher rates of inflation, • higher transaction costs, • difficulty in enforcing contractual obligations, • fewer investor protections and less publicly available information about companies, 60 Table of Contents • certain economic and political risks, including potential exchange control regulations and restrictions on our non-U.S. investments and repatriation of profits on investments or of capital invested, the risks of war, terrorist attacks, political, economic or social instability, the possibility of expropriation or confiscatory taxation and adverse economic and political developments and • the possible imposition of non-U.S. taxes or withholding on income and gains recognized with respect to such securities.
These provisions are detrimental to the holders of our common stock because they restrict the remedies available to stockholders for actions of the Series II Preferred Stockholder. 75 Table of Contents In addition, we have agreed to indemnify the Series II Preferred Stockholder and our former general partner and its controlling affiliates and any current or former officer or director of any of Blackstone or its subsidiaries, the Series II Preferred Stockholder or former general partner and certain other specified persons (collectively, the “Indemnitees”), to the fullest extent permitted by law, against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts incurred by any Indemnitee.
These provisions are detrimental to the holders of our common stock because they restrict the remedies available to stockholders for actions of the Series II Preferred Stockholder. 74 Table of Contents In addition, we have agreed to indemnify the Series II Preferred Stockholder and our former general partner and its controlling affiliates and any current or former officer or director of any of Blackstone or its subsidiaries, the Series II Preferred Stockholder or former general partner and certain other specified persons (collectively, the “Indemnitees”), to the fullest extent permitted by law, against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts incurred by any Indemnitee.
The incurrence of a significant amount of indebtedness by an entity could, among other things: • give rise to an obligation to make mandatory pre-payments of debt using excess cash flow, which might limit the entity’s ability to respond to changing industry conditions to the extent additional cash is needed for the response, to make unplanned but necessary capital expenditures or to take advantage of growth opportunities, • limit the entity’s ability to adjust to changing market conditions, thereby placing it at a competitive disadvantage compared to its competitors who have relatively less debt, • allow even moderate reductions in operating cash flow to render it unable to service its indebtedness, leading to a bankruptcy or other reorganization of the entity and a loss of part or all of the equity investment in it, • limit the entity’s ability to engage in strategic acquisitions that might be necessary to generate attractive returns or further growth and • limit the entity’s ability to obtain additional financing or increase the cost of obtaining such financing, including for capital expenditures, working capital or general corporate purposes.
The incurrence of a significant amount of indebtedness by an entity could, among other things: • give rise to an obligation to make mandatory pre-payments of debt using excess cash flow, which might limit the entity’s ability to respond to changing industry conditions to the extent additional cash is needed for the response, to make unplanned but necessary capital expenditures or to take advantage of growth opportunities, • limit the entity’s ability to adjust to changing market conditions, thereby placing it at a competitive disadvantage compared to its competitors who have relatively less debt, 57 Table of Contents • allow even moderate reductions in operating cash flow to render it unable to service its indebtedness, leading to a bankruptcy or other reorganization of the entity and a loss of part or all of the equity investment in it, • limit the entity’s ability to engage in strategic acquisitions that might be necessary to generate attractive returns or further growth and • limit the entity’s ability to obtain additional financing or increase the cost of obtaining such financing, including for capital expenditures, working capital or general corporate purposes.
If a company in which our funds are invested is unable to obtain regulatory approval for a product candidate, or a product candidate in which our funds are invested does not obtain regulatory approval, in a timely fashion or at all, the value of our investment would be adversely impacted.
If a company in which our funds are invested is unable to obtain regulatory approval for a product candidate, or a product candidate in which our funds are invested does not obtain regulatory approval, in a timely fashion or at all, the value of our fund’s investment would be adversely impacted.
These factors make it difficult to predict future commodity price movements with any certainty. Our investments in infrastructure assets may expose us to increased risks that are inherent in the ownership of real assets. Investments in infrastructure assets may expose us to increased risks that are inherent in the ownership of real assets.
These factors make it difficult to predict future commodity price movements with any certainty. Our funds’ investments in infrastructure assets may expose us to increased risks that are inherent in the ownership of real assets. Investments in infrastructure assets may expose us to increased risks that are inherent in the ownership of real assets.
Accessing individual investors and offering products directed at such investors exposes us to new and greater levels of risk, including heightened litigation and regulatory enforcement, an increased compliance burden, and more complex administration and accounting operations.
Accessing individual investors and offering products directed at such investors exposes us to greater levels of risk, including heightened litigation and regulatory enforcement, an increased compliance burden, and more complex administration and accounting operations.
In addition, our ability to identify business and other risks associated with new investments depends in part on our ability to anticipate and accurately assess regulatory, legislative and other changes that may have a material impact on our investments.
In addition, our ability to identify business and other risks associated with new investments depends in part on our ability to anticipate and accurately assess regulatory, legislative and other changes that may have a material impact on our funds’ investments.
If our systems or those of third-party serve providers are compromised either as a result of malicious activity or through inadvertent transmittal or other loss of data, do not operate properly or are disabled, or we fail to provide the appropriate regulatory or other notifications in a timely manner, we could suffer financial loss, increased costs, a disruption of our businesses, liability to our counterparties, investment funds or fund investors, regulatory intervention or reputational damage.
If our systems or those of third-party service providers are compromised either as a result of malicious activity or through inadvertent transmittal or other loss of data, do not operate properly or are disabled, or we fail to provide the appropriate regulatory or other notifications in a timely manner, we could suffer financial loss, increased costs, a disruption of our businesses, liability to our counterparties, investment funds or fund investors, regulatory intervention or reputational damage.
In addition, the use of leverage by the hedge funds in which our funds of hedge funds invest poses additional risks, including those described in “— Dependence on significant leverage in investments by our funds could adversely affect our ability to achieve attractive rates of return on those investments.” 71 Table of Contents We are reliant on third-party service providers for certain aspects of our business, and are subject to risks in using prime brokers, custodians, counterparties, administrators and other agents.
In addition, the use of leverage by the hedge funds in which our funds of hedge funds invest poses additional risks, including those described in “— Dependence on significant leverage in investments by our funds could adversely affect our ability to achieve attractive rates of return on those investments.” 70 Table of Contents We are reliant on third-party service providers for certain aspects of our business, and are subject to risks in using prime brokers, custodians, counterparties, administrators and other agents.
In addition, conflicts of interest may exist in the valuation of our investments, as well as the personal trading of employees and the allocation of fees and expenses among us, our funds and their portfolio companies, and our affiliates.
In addition, conflicts of interest may exist in the valuation of our funds’ investments, as well as the personal trading of employees and the allocation of fees and expenses among us, our funds and their portfolio companies, and our affiliates.
During periods in which a significant portion of our assets under management is attributable to carry funds that are not in their harvesting periods, we may receive substantially lower Performance Allocations. 28 Table of Contents Adverse economic and market conditions may adversely affect the amount of cash generated by our businesses, the value of our principal investments, and in turn, our ability to pay dividends to our stockholders.
During periods in which a significant portion of our assets under management is attributable to carry funds that are not in their harvesting periods, we may receive substantially lower Performance Allocations. 27 Table of Contents Adverse economic and market conditions may adversely affect the amount of cash generated by our businesses, the value of our principal investments, and in turn, our ability to pay dividends to our stockholders.
Investors, including public pension funds, which represent a significant portion of our funds’ investor bases, may decide to withdraw previously committed capital (where such withdrawal is permitted) or not commit capital to future fundraises based on their assessment of how we approach and consider the ESG cost of investments and whether the return-driven objectives of our funds align with their ESG priorities.
Investors, including public pension funds, which represent a significant portion of our funds’ investor bases, may decide to withdraw previously committed capital (where such withdrawal is permitted) or not commit capital to future fundraises based on their assessment of how we approach and consider the sustainability cost of investments and whether the return-driven objectives of our funds align with their sustainability priorities.
In addition, rising interest rates, coupled with periods of significant equity and credit market volatility may potentially make it more difficult for us to find attractive opportunities for our funds to exit and realize value from their existing investments. Our funds’ portfolio companies also regularly utilize the corporate debt markets to obtain financing for their operations.
In addition, high interest rates, coupled with periods of significant equity and credit market volatility, may potentially make it more difficult for us to find attractive opportunities for our funds to exit and realize value from their existing investments. Our funds’ portfolio companies also regularly utilize the corporate debt markets to obtain financing for their operations.
Other states could potentially take similar actions, which may further impair our access to capital from an investor base that has historically represented a significant portion of our fundraising. 29 Table of Contents In addition, volatility in the valuations of investments, has in the past and may in the future affect our ability to raise capital from third-party investors.
Other states could potentially take similar actions, which may further impair our access to capital from an investor base that has historically represented a significant portion of our fundraising. 28 Table of Contents In addition, volatility in the valuations of investments, has in the past and may in the future affect our ability to raise capital from third-party investors.
In the event such clinical trials do not comply with the complicated regulatory requirements applicable thereto, such special purpose development companies may be subject to regulatory actions. • Intellectual property often constitutes an important part of a life sciences company’s assets and competitive strengths, particularly for royalty monetization transactions.
In the event such clinical trials do not comply with the complicated regulatory requirements applicable thereto, such special purpose development companies may be subject to regulatory actions. • Intellectual property often constitutes an important part of a life sciences company’s assets and competitive strengths, particularly for royalty monetization and corporate partnership transactions.
In addition, the distribution of products to individual investors out of the U.S. may involve complex structures (such as distributor-sponsored feeder funds or nominee/omnibus investors) and market practices that vary by local jurisdiction. As a result, this expansion subjects us to additional complexity, litigation and regulatory risk.
In addition, the distribution of products to individual investors outside of the U.S. may involve complex structures (such as distributor-sponsored feeder funds or nominee/omnibus investors) and market practices that vary by local jurisdiction. As a result, this expansion subjects us to additional complexity, litigation and regulatory risk.
For example, in February 2022, the SEC proposed rules regarding registered investment advisers’ and funds’ cybersecurity risk management requiring the adoption and implementation of cybersecurity policies and procedures, enhanced disclosure in regulatory filings and prompt reporting of incidents to the SEC, which, if adopted, could increase our compliance costs and potential regulatory liability related to cybersecurity.
For example, in February 2022, the SEC proposed rules regarding registered investment advisers’ and funds’ cybersecurity risk management requiring the adoption and implementation of cybersecurity policies and procedures, enhanced disclosure in regulatory filings and prompt reporting of incidents to the SEC. if adopted, such rules could increase our compliance costs and potential regulatory liability related to cybersecurity.
Concerns with liquidity could cause such public pension funds to reevaluate the appropriateness of alternative investments. In addition, our ability to raise capital from third parties outside of the United States could be limited to the extent the other countries, such as China, impose restrictions or limitations on outbound foreign investment.
Concerns with liquidity could cause such public pension funds to reevaluate the appropriateness of alternative investments. In addition, our ability to raise capital from third parties outside of the United States could be limited to the extent the other countries impose restrictions or limitations on outbound foreign investment.
To the extent periods of volatility are coupled with a lack of realizations from investors’ existing portfolios, such investors may be left with disproportionately outsized remaining commitments to a number of investment funds, which significantly limits such investors’ ability to make new commitments to third-party managed investment funds such as those managed by us.
To the extent periods of volatility are coupled with a lack of realizations from investors’ existing portfolios, such investors may be left with disproportionately outsized remaining commitments to a number of investment funds. This significantly limits such investors’ ability to make new commitments to third-party managed investment funds such as those managed by us.
If we do not successfully manage ESG-related expectations across the varied interests of our stakeholders, including existing or potential investors, our ability to access and deploy capital may be adversely impacted. In addition, a failure to successfully manage ESG-related expectations may negatively impact our reputation and erode stakeholder trust.
If we do not successfully manage sustainability-related expectations across the varied interests of our stakeholders, including existing or potential investors, our ability to access and deploy capital may be adversely impacted. In addition, a failure to successfully manage sustainability-related expectations may negatively impact our reputation and erode stakeholder trust.
With respect to ESG, the nature and scope of our diligence will vary based on the investment, but may include a review of, among other things: energy management, air and water pollution, land contamination, human capital management, human rights, employee health and safety, accounting standards and bribery and corruption.
With respect to sustainability, the nature and scope of our diligence will vary based on the investment, but may include a review of, among other things: energy management, air and water pollution, land contamination, human capital management, human rights, employee health and safety, accounting standards and bribery and corruption.
Any inability, or perceived inability, by us to adequately address privacy concerns, or comply with applicable privacy laws, regulations, policies, industry standards, or related contractual obligations, even if unfounded, could result in regulatory and third-party liability, increased costs, disruption business and operations, and reputational damage.
Any inability, or perceived inability, by us to adequately address privacy concerns, or comply with applicable privacy laws, regulations, policies, industry standards, or related contractual obligations, even if unfounded, could result in regulatory and third-party liability, increased costs, disruptions to business and operations, and reputational damage.
Furthermore, the SEC (in May 2023) and the SEC and CFTC jointly (in February 2024) adopted changes to Form PF, a confidential form relating to reporting by private fund advisers and intended to be used by the Financial Stability Oversight Counsel (“FSOC”) for systemic risk oversight purposes, that expand existing reporting obligations.
For example, the SEC (in May 2023) and the SEC and CFTC jointly (in February 2024) adopted changes to Form PF, a confidential form relating to reporting by private fund advisers and intended to be used by the Financial Stability Oversight Counsel (“FSOC”) for systemic risk oversight purposes, that expand existing reporting obligations.
We, our funds and our funds’ portfolio companies face risks associated with climate change including risks related to the impact of climate-and ESG-related legislation and regulation (both domestically and internationally), risks related to business trends related to climate change and technology (such as the process of transitioning to a lower-carbon economy), and risks stemming from the physical impacts of climate change.
We, our funds and our funds’ portfolio companies face risks associated with climate change including risks related to the impact of climate- and sustainability-related legislation and regulation (both domestically and internationally), risks related to business trends related to climate change and technology (such as the process of transitioning to a lower-carbon economy), and risks stemming from the physical impacts of climate change.
In addition, the increased scrutiny placed by regulators, elected officials and certain investors with respect to the incorporation of ESG factors in the investment process and the impact of certain investments made by our energy funds has negatively impacted and is likely to continue to negatively impact our ability to exit certain of our conventional energy investments on favorable terms.
In addition, the increased scrutiny placed by regulators, elected officials and certain investors with respect to the incorporation of sustainability factors in the investment process and the impact of certain investments made by our energy funds has negatively impacted and is likely to continue to negatively impact our ability to exit certain of our conventional energy investments on favorable terms.
In addition, as the governing agreements of our funds contain only limited requirements regarding diversification of fund investments (by, for example, sector or geographic region), during periods of economic slowdown in certain sectors or regions, the impact on our funds may be exacerbated by concentration of investments in such sectors or regions.
In addition, as the governing agreements of our funds contain only limited requirements, if any, regarding diversification of fund investments (by, for example, sector or geographic region), during periods of economic slowdown in certain sectors or regions, the impact on our funds may be exacerbated by concentration of investments in such sectors or regions.
The CFTC is also working to provide new guidance regarding prime broker arrangements and intermediation generally with regard to trading on swap execution facilities. 72 Table of Contents The counterparty risks that we face have increased in complexity and magnitude over time.
The CFTC is also working to provide new guidance regarding prime broker arrangements and intermediation generally with regard to trading on swap execution facilities. 71 Table of Contents The counterparty risks that we face have increased in complexity and magnitude over time.
In Europe, the EU Alternative Investment Fund Managers Directive (“AIFMD”) establishes a regulatory regime for alternative investment fund managers (“AIFMs”), including our AIFMs in Luxembourg and Ireland. The U.K. has “on-shored” AIFMD and therefore similar requirements continue to apply to funds marketed to U.K. investors notwithstanding Brexit.
In Europe, the EU Alternative Investment Fund Managers Directive (“AIFMD”) establishes a regulatory regime for alternative investment fund managers (“AIFMs”), including our AIFMs in Luxembourg and Ireland. The U.K. has “on-shored” AIFMD and therefore similar requirements continue to apply to funds marketed to U.K. investors.
If we were designated as a nonbank SIFI, including as a result of our asset management or nonbank lending activities, we could become subject to direct supervision by the Federal Reserve Board, and could become subject to enhanced prudential, capital, supervisory and other requirements, such as risk-based capital requirements, leverage limits, liquidity requirements, resolution plan and credit exposure report requirements, concentration limits, a contingent capital requirement, enhanced public disclosures, short-term debt limits and overall risk management requirements.
If we were designated as a nonbank SIFI, including as a result of our asset management or nonbank lending activities, we could become subject to direct supervision by the Federal Reserve Board, and could become subject to enhanced prudential, capital, supervisory and other requirements, such as risk-based capital requirements, leverage limits, liquidity requirements, resolution plan and credit exposure report requirements, concentration limits, a contingent capital requirement, enhanced public 44 Table of Contents disclosures, short-term debt limits and overall risk management requirements.
Pursuant to these exceptions, controlled companies may elect not to comply with certain corporate governance requirements of the New York Stock Exchange, including the requirements (a) that a majority of our board of directors consist of independent directors, (b) that we have a nominating and corporate governance committee that is composed entirely of independent directors, (c) that we have a compensation committee that is composed entirely of independent directors and (d) that the compensation committee be required to consider certain independence factors when engaging compensation consultants, legal counsel and other committee advisers.
Pursuant to these exceptions, controlled companies 73 Table of Contents may elect not to comply with certain corporate governance requirements of the New York Stock Exchange, including the requirements (a) that a majority of our board of directors consist of independent directors, (b) that we have a nominating and corporate governance committee that is composed entirely of independent directors, (c) that we have a compensation committee that is composed entirely of independent directors and (d) that the compensation committee be required to consider certain independence factors when engaging compensation consultants, legal counsel and other committee advisers.
Further, some matters covered by our diligence, such as ESG, are continuously evolving and we may not accurately or fully anticipate such evolution. The framework we may use to evaluate certain diligence considerations may not represent a universally recognized standard for assessing such considerations.
Further, some matters covered by our diligence, such as sustainability, are continuously evolving and we may not accurately or fully anticipate such evolution. The framework we may use to evaluate certain diligence considerations may not represent a universally recognized standard for assessing such considerations.
Our principal sources of cash are: (a) cash we received in connection with our prior bond offerings, (b) management fees, (c) realized incentive fees and (d) realized performance allocations, which is the sum of Realized Principal Investment Income and Realized Performance Revenues less Realized Performance Compensation.
Our principal sources of cash are: (a) cash we received in connection with our prior bond offerings and other borrowings, (b) management fees, (c) realized incentive fees and (d) realized performance allocations, which is the sum of Realized Principal Investment Income and Realized Performance Revenues less Realized Performance Compensation.
This data is wide ranging and relates to our investors, employees, contractors and other counterparties and third parties.
This personal data is wide ranging and relates to our investors, employees, contractors and other counterparties and third parties.
These initiatives, commitments and goals could be difficult and expensive to implement, the personnel, processes and technologies needed to implement them may not be cost effective and may not advance at a sufficient pace, and we may not be able to accomplish them within the timelines we announce or at all.
These initiatives could be difficult and expensive to implement, the personnel, processes and technologies needed to implement them may not be cost effective and may not advance at a sufficient pace, and we may not be able to accomplish them within the timelines we announce or at all.
Moreover, we face business trends related to climate change risks, such as, for example, the increased attention to ESG considerations by our fund investors, including in connection with their determination of whether to invest in our funds.
Moreover, we face business trends related to climate change risks, such as, for example, the increased attention to sustainability considerations by our fund investors, including in connection with their determination of whether to invest in our funds.
See “— Laws and regulations on foreign direct investment applicable to us and our funds’ portfolio companies, both within and outside the U.S, may make it more difficult for us to deploy capital in certain jurisdictions or to sell assets to certain buyers.” Our provision of products and services to insurance companies subjects us to a variety of risks and uncertainties.
See “—Laws and regulations on foreign direct investment applicable to us and our funds’ portfolio companies, both within and outside the U.S, may make it more difficult for us to deploy capital in certain jurisdictions or to sell assets to certain buyers.” 45 Table of Contents Our provision of products and services to insurance companies subjects us to a variety of risks and uncertainties.
Power and energy generation facilities in which our funds invest are also subject to risks associated with volatility in the price of fuel sources and the impact of unusual or adverse weather conditions or other natural events, such as droughts or wildfires, as well as the risk 66 Table of Contents of performance below expected levels of output, efficiency or reliability.
Power and energy generation facilities in 65 Table of Contents which our funds invest are also subject to risks associated with volatility in the price of fuel sources and the impact of unusual or adverse weather conditions or other natural events, such as droughts, wildfires or hurricanes, as well as the risk of performance below expected levels of output, efficiency or reliability.
We may be subject to claims related to matters such as the adequacy of disclosures, appropriateness of fees, suitability and board of directors oversight, each which could result in civil lawsuits, regulatory penalties and enforcement actions.
We may be subject to claims related to matters such as the adequacy of disclosures, appropriateness of fees, suitability and board of directors’ oversight, each of which could result in civil lawsuits, regulatory penalties and enforcement actions.
Further, state regulatory agencies may impose restrictions on private funds’ investments in certain types of assets, which could affect our funds’ ability to find attractive and diversified investments and to complete such investments in a timely manner.
Further, state regulatory agencies may impose restrictions on private funds’ investments in certain types of assets or industries, which could affect our funds’ ability to find attractive and diversified investments and to complete such investments in a timely manner.
This “systemic risk” may adversely affect the financial intermediaries (such as clearing agencies, clearing houses, banks, securities firms and exchanges) with which the hedge funds interact on a daily basis. 70 Table of Contents • The efficacy of investment and trading strategies depends largely on the ability to establish and maintain an overall market position in a combination of financial instruments.
This “systemic risk” may adversely affect the financial intermediaries (such as clearing agencies, clearing houses, banks, securities firms and exchanges) with which the hedge funds interact on a daily basis. • The efficacy of investment and trading strategies depends largely on the ability to establish and maintain an overall market position in a combination of financial instruments.
Alternatively, we may experience decreased rates of return and increased risks of loss if we match investment prices, structures and terms offered by competitors. Moreover, if we are forced to compete with other alternative asset managers on the basis of price, we may 31 Table of Contents not be able to maintain our current fund fee and carried interest terms.
Alternatively, we may experience decreased rates of return and increased risks of loss if we match investment prices, structures and terms offered by competitors. Moreover, if we are forced to compete with other alternative asset managers on the basis of price, we may not be able to maintain our current fund fee and carried interest terms.
This divergence increases the risk that any action or lack thereof with respect to ESG matters will be perceived negatively by at least some stakeholders and adversely impact our reputation and business.
This divergence increases the risk that any action or lack thereof with respect to sustainability matters will be perceived negatively by at least some stakeholders and adversely impact our reputation and business.
As a result of such regimes, we may incur significant delays and costs, be altogether prohibited from making a particular investment or impede or restrict syndication or sale of certain assets to certain buyers, all of which could adversely affect the performance of our funds and in turn, materially reduce our revenues and cash flow.
As a result of such regimes, we may incur significant delays and costs, be altogether prohibited from 49 Table of Contents making a particular investment or impede or restrict syndication or sale of certain assets to certain buyers, all of which could adversely affect the performance of our funds and in turn, materially reduce our revenues and cash flow.
When conducting due diligence, we may be required to evaluate important and complex issues, including but not limited to those related to business, financial, credit risk, tax, accounting, ESG, legal and regulatory and macroeconomic trends.
When conducting due diligence, we may be required to evaluate important and complex issues, including but not limited to those related to business, financial, credit risk, tax, accounting, sustainability, legal and regulatory and macroeconomic trends.
See “— Trade negotiations and related government actions may create regulatory uncertainty for our funds’ portfolio companies and our investment strategies and adversely affect the profitability of our funds’ portfolio companies.” 61 Table of Contents We may not have sufficient cash to pay back “clawback” obligations if and when they are triggered under the governing agreements with our investors.
See “— Trade negotiations and related government actions may create regulatory uncertainty for our funds’ portfolio companies and our investment strategies and adversely affect the profitability of our funds’ portfolio companies.” We may not have sufficient cash to pay back “clawback” obligations if and when they are triggered under the governing agreements with our investors.
Governments and third-party payers continue to pursue aggressive initiatives to contain costs and manage drug utilization and are increasingly focused on the effectiveness, benefits and costs of similar treatments, which could result in lower reimbursement rates and narrower populations for whom the products in which BXLS invests will be reimbursed by third-party payers.
Governments and third-party payers continue to pursue aggressive initiatives to contain costs and 68 Table of Contents manage drug utilization and are increasingly focused on the effectiveness, benefits and costs of similar treatments, which could result in lower reimbursement rates and narrower populations for whom the products in which BXLS invests will be reimbursed by third-party payers.
The failure to accurately anticipate the possible outcome of such changes and/or reforms could have a material adverse effect on the returns generated from our funds’ investments and our revenues. 43 Table of Contents In recent years, there has been increased regulatory enforcement activity and rulemaking impacting the financial services industry.
The failure to accurately anticipate the possible outcome of such changes and/or reforms could have a material adverse effect on the returns generated from our funds’ investments and our revenues. In recent years, there has been increased regulatory enforcement activity and rulemaking impacting the financial services industry.
An investment in such business enterprises entails the risk that the transaction in which such business enterprise is involved either will be unsuccessful, will take considerable time or will result in a distribution of cash or a new security the value of which will be less than the purchase price to the fund of the 65 Table of Contents security or other financial instrument in respect of which such distribution is received.
An investment in such business enterprises entails the risk that the transaction in which such business enterprise is involved either will be unsuccessful, will take considerable time or will result in a distribution of cash or a new security the value of which will be less than the purchase price to the fund of the security or other financial instrument in respect of which such distribution is received.
In order to obtain new borrowings, or to extend or refinance existing borrowings, we are dependent on the willingness and ability of financial institutions such as global banks to extend credit to us on favorable terms or at all, and on our ability to access the debt and equity capital markets, which can be volatile.
In order to obtain new borrowings, or to extend or refinance existing borrowings, we are dependent on the willingness and 56 Table of Contents ability of financial institutions such as global banks to extend credit to us on favorable terms or at all, and on our ability to access the debt and equity capital markets, which can be volatile.
The absence of a regulated market to facilitate settlement may increase the potential for losses. • Credit risk may arise through a default by one of several large institutions that are dependent on one another to meet their liquidity or operational needs, so that a default by one institution causes a series of defaults by the other institutions.
The absence of a regulated market to facilitate settlement may increase the potential for losses. 69 Table of Contents • Credit risk may arise through a default by one of several large institutions that are dependent on one another to meet their liquidity or operational needs, so that a default by one institution causes a series of defaults by the other institutions.
A Blackstone Holdings limited partner must exchange one partnership unit in each of the 79 Table of Contents Blackstone Holdings Partnerships to effect an exchange for a share of common stock. The common stock we issue upon such exchanges would be “restricted securities,” as defined in Rule 144 under the Securities Act, unless we register such issuances.
A Blackstone Holdings limited partner must exchange one partnership unit in each of the Blackstone Holdings Partnerships to effect an exchange for a share of common stock. The common stock we issue upon such exchanges would be “restricted securities,” as defined in Rule 144 under the Securities Act, unless we register such issuances.
Certain investors also have begun to request or require data from their asset managers and/or use third-party benchmarks and ratings to allow them to monitor the ESG impact of their investments.
Certain investors also have begun to request or require data from their asset managers and/or use third-party benchmarks and ratings to allow them to monitor the sustainability impact of their investments.
Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 19. Commitments and Contingencies — Contingencies — Litigation.” Any private lawsuits or regulatory actions brought against us and resulting in a finding of substantial legal liability could materially adversely affect our business, financial condition or results of operations.
Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — 18. Commitments and Contingencies - Contingencies - Litigation.” Any private lawsuits or regulatory actions brought against us and resulting in a finding of substantial legal liability could materially adversely affect our business, financial condition or results of operations.
Because of our various asset management businesses and our capital markets services business, we will be subject to a number of actual and potential conflicts of interest and subject to greater regulatory oversight and more legal and contractual restrictions than that to which we would otherwise be subject if we had just one line of business.
Because of our various asset management businesses and our capital markets services business, we will be subject to a number of actual and potential conflicts of interest and subject to greater regulatory oversight and more legal and contractual restrictions than that to which we would otherwise be subject if we had just one line of 53 Table of Contents business.
Finally, our and our funds’ portfolio companies’ technology platforms, data and intellectual property are also subject to a heightened risk of theft or compromise to the extent we or our funds’ portfolio companies engage in operations outside the United States, in particular in those jurisdictions that do not have comparable levels of protection of proprietary information and assets such as intellectual property, trademarks, trade secrets, know-how and customer information and records.
Our and our funds’ portfolio companies’ technology platforms, data and intellectual property are also subject to a heightened risk of theft or compromise to the extent we or our funds’ portfolio companies engage in operations outside the United States, in particular in those jurisdictions that do not have comparable levels of protection of proprietary information and assets such as intellectual property, trademarks, trade secrets, know- 36 Table of Contents how and customer information and records.
Moreover, because the investment strategy of many of our funds, particularly our private equity and real estate funds, often entails our having representation on our funds’ public portfolio company boards, our 60 Table of Contents funds may be restricted in their ability to effect such sales during certain time periods.
Moreover, because the investment strategy of many of our funds, particularly our private equity and real estate funds, often entails our having representation on our funds’ public portfolio company boards, our funds may be restricted in their ability to effect such sales during certain time periods.
See “— Financial regulatory changes in the United States could adversely affect our business.” These competitive pressures could adversely affect our ability to make successful investments and limit our ability to raise future investment funds, either of which would adversely impact our business, revenue, results of operations and cash flow.
See “—Financial regulatory changes in the United States could adversely affect our business.” 31 Table of Contents These competitive pressures could adversely affect our ability to make successful investments and limit our ability to raise future investment funds, either of which would adversely impact our business, revenue, results of operations and cash flow.
For example, certain traditional asset managers have developed their own private equity and retail platforms and are marketing other asset allocation strategies as alternatives to hedge fund investments.
For example, certain traditional asset managers have developed their own private equity and private wealth platforms and are marketing other asset allocation strategies as alternatives to hedge fund investments.
In addition, we believe Blackstone Inc. is not an investment company under section 3(b)(1) of the 1940 Act because it is primarily engaged in a non-investment company business. 78 Table of Contents The 1940 Act and the rules thereunder contain detailed parameters for the organization and operation of investment companies.
In addition, we believe Blackstone Inc. is not an investment company under section 3(b)(1) of the 1940 Act because it is primarily engaged in a non-investment company business. The 1940 Act and the rules thereunder contain detailed parameters for the organization and operation of investment companies.
In addition, we could be criticized for the scope or nature of such initiatives or goals, or for any revisions to these goals. Further, as part of our ESG practices, we rely from time to time on third-party data, services and methodologies and such services, data and methodologies could prove to be incomplete or inaccurate.
In addition, we could be criticized for the scope or nature of such initiatives, or for any revisions to these initiatives. Further, as part of our sustainability practices, we rely from time to time on third-party data, services and methodologies and such services, data and methodologies could prove to be incomplete or inaccurate.
Moreover, with respect to the historical returns of our investment funds: • we may create new funds in the future that reflect a different asset mix and different investment strategies (including funds whose management fees represent a more significant proportion of the fees than has historically been the case), as well as a varied geographic and industry exposure as compared to our present funds, and any such new funds could have different returns from our existing or previous funds, • the rates of returns of our carry funds reflect unrealized gains as of the applicable measurement date that may never be realized, which may adversely affect the ultimate value realized from those funds’ investments, • competition for investment opportunities resulting from, among other things, the increased amount of capital invested in alternative investment funds continues to increase, • our investment funds’ returns in some years benefited from investment opportunities and general market conditions that may not repeat themselves, our current or future investment funds might not be able to avail themselves of comparable investment opportunities or market conditions, and the circumstances under which our current or future funds may make future investments may differ significantly from those conditions prevailing in the past, 53 Table of Contents • newly established funds may generate lower returns during the period in which they initially deploy their capital and • the rates of return reflect our historical cost structure, which may vary in the future due to various factors enumerated elsewhere in this report and other factors beyond our control, including changes in laws.
Moreover, with respect to the historical returns of our investment funds: • we may create new funds in the future that reflect a different asset mix and different investment strategies (including funds whose management fees represent a more significant proportion of the fees than has historically been the case), as well as a varied geographic and industry exposure as compared to our present funds, and any such new funds could have different returns from our existing or previous funds, • the rates of returns of our carry funds reflect unrealized gains as of the applicable measurement date that may never be realized, which may adversely affect the ultimate value realized from those funds’ investments, • competition for investment opportunities continues to increase as a result of, among other things, the increased amount of capital invested in alternative investment funds, • our investment funds’ returns in some years benefited from investment opportunities and general market conditions that may not repeat themselves, our current or future investment funds might not be able to avail themselves of comparable investment opportunities or market conditions, and the circumstances under which our current or future funds may make future investments may differ significantly from those conditions prevailing in the past, • newly established funds may generate lower returns during the period in which they initially deploy their capital, which may result in little or no carried interest due to performance hurdles and • the rates of return reflect our historical cost structure, which may vary in the future due to various factors enumerated elsewhere in this report and other factors beyond our control, including changes in laws.
Similarly, there is a risk that Blackstone employees involved in the direct distribution of our products, or employees who oversee independent advisors, brokerage firms and other third parties around the world involved in distributing our products, do not follow our compliance and supervisory procedures.
Similarly, there is a risk that Blackstone employees involved in the direct distribution of our products, or employees who engage with independent advisors, brokerage firms and other third parties around the world involved in distributing our products, do not follow our compliance and supervisory procedures.
Investors in our hedge funds may generally redeem their investments on a periodic basis following, in certain cases, the expiration of a specified period of time when capital may not be withdrawn, subject to the applicable fund’s specific redemption provisions.
Investors in our hedge funds may generally redeem their investments on a periodic basis following, in certain cases, 61 Table of Contents the expiration of a specified period of time when capital may not be withdrawn, subject to the applicable fund’s specific redemption provisions.
We primarily use cash to, without limitation (a) provide capital to facilitate the growth of our existing businesses, which principally includes funding our general partner and co-investment commitments to our funds, (b) provide capital for business expansion, (c) pay operating expenses, including cash compensation to our employees, and other obligations as they arise, including servicing our debt and (d) pay dividends to our stockholders, make distributions to the holders of Blackstone Holdings Partnership Units and make repurchases under our share repurchase program.
We primarily use cash to, without limitation (a) provide capital to facilitate the growth of our existing businesses, including funding our general partner and co-investment commitments to our funds and warehousing investments for our funds, (b) provide capital for business expansion, (c) pay operating expenses, including cash compensation to our employees, and other obligations as they arise, including servicing our debt and (d) pay dividends to our stockholders, make distributions to the holders of Blackstone Holdings Partnership Units and make repurchases under our share repurchase program.
Additionally, technological innovation, including the use of artificial intelligence and data science, has the potential to disrupt the financial industry and change the way financial institutions, including asset managers, do business.
Additionally, technological innovation, including the use of artificial intelligence, has the potential to disrupt the financial industry and change the way financial institutions, including asset managers, do business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Cybersecurity Governance Blackstone has a dedicated cybersecurity team, led by our CSO, who works closely with our senior management, including our Chief Technology Officer (“CTO”), to develop and advance the firm’s cybersecurity strategy. Our CSO and CTO have extensive experience in cybersecurity and technology, respectively.
Cybersecurity Governance Blackstone has a dedicated cybersecurity team, led by our CSO, who works closely with our senior management, including our Chief Technology Officer (“CTO”), to develop and advance the firm’s cybersecurity program and strategy. Our CSO and CTO have extensive experience in cybersecurity and technology, respectively.
These measures include, where appropriate, physical and digital access controls, patch management, identity verification and mobile device management software, annual employee cybersecurity awareness and best practices training programs, security baselines and tools to report anomalous activity, and monitoring of data usage, hardware and software.
These measures include, where appropriate, physical and digital access controls, patch management, identity verification and mobile device management software, new hire and annual employee cybersecurity awareness and best practices training programs, security baselines and tools to report anomalous activity, and monitoring of data usage, hardware and software.
The IRP sets out ongoing monitoring or remediating actions to be taken after resolution of an incident. The IRP is reviewed at least annually by our CSO and members of BXTI and Legal and Compliance.
The IRP sets out ongoing monitoring or remediating actions to be taken after resolution of an incident. The IRP is reviewed at least annually by members of BXTI and Legal and Compliance.
Blackstone maintains a formal cybersecurity risk management process and cybersecurity risk register, designed to track cybersecurity risks at the firm, and integrates these processes into the firm’s overall risk management practices described above.
Blackstone maintains a formal cybersecurity risk management process and cybersecurity risk register, designed to identify, track and treat cybersecurity risks at the firm, and integrates these processes into the firm’s overall risk management practices described above.
Blackstone also utilizes a number of digital controls, which are reviewed at least annually, to monitor and manage third-party access to its internal systems and data. For a discussion of how risks from cybersecurity threats affect our business, see “Part 1. Item 1A.
Blackstone also utilizes a number of digital controls, which are reviewed at least annually, to monitor and manage third-party access to its internal systems and data. For a discussion of how risks from cybersecurity threats affect our business, see “—Item 1A.
Blackstone’s CSO reports to the board of directors and the audit committee of the board of directors at least annually on cybersecurity matters, including risks. These reports also include, as applicable, an overview of cybersecurity incidents. Additionally, the CSO provides quarterly updates to management on Blackstone’s cybersecurity risks and program developments.
Blackstone’s CSO reports to the board of directors and the audit committee of the board of directors at least annually on cybersecurity matters, including risks. These reports also include, as applicable, an overview of cybersecurity incidents. Additionally, the CSO provides quarterly updates to management on Blackstone’s cybersecurity risks and program developments. 82 Table of Contents
Further, we engage in cyber incident tabletop exercises and scenario planning exercises involving hypothetical cybersecurity incidents 81 Table of Contents to test our cyber incident response processes. Our Chief Security Officer (the “CSO”) and members of senior management, Legal and Compliance, Technology and Innovations (“BXTI”) and Global Corporate Affairs participate in these exercises.
Further, we engage in cybersecurity incident tabletop exercises and scenario planning exercises involving hypothetical cybersecurity incidents to test our cybersecurity incident response processes. Our Chief Security Officer (the “CSO”) and members of senior management, Legal and Compliance, Technology and Innovations (“BXTI”) and Global Corporate Affairs participate in these exercises.
Learnings from these tabletop exercises and any events we experience are reviewed, discussed and incorporated into our cybersecurity framework as appropriate.
Learnings from these tabletop exercises and any cybersecurity events we experience are reviewed, discussed and incorporated into our cybersecurity incident response processes, as appropriate.
The CSO and CTO review Blackstone’s cybersecurity framework annually as well as on an event-driven basis as necessary. The CSO and CTO also review the scope of our cybersecurity measures periodically, including in the event of a change in business practices that may implicate the security or integrity of our information and systems.
The CSO and CTO also review the scope of our cybersecurity measures periodically, including in the event of a change in business practices that may implicate the security or integrity of our information and systems. Blackstone’s board of directors is responsible for understanding the primary risks to our business.
In addition, where appropriate, Blackstone seeks to include in its contractual arrangements with certain of its third-party vendors provisions addressing best practices with respect to data and cybersecurity, as well as the right to assess, monitor, audit and test such vendors’ cybersecurity programs and practices.
On the basis of its preliminary risk assessment of a third-party vendor, Blackstone may conduct further cybersecurity reviews or request remediation of, or contractual protections related to, any actual or potential identified cybersecurity risks. 81 Table of Contents In addition, where appropriate, Blackstone seeks to include in its contractual arrangements with certain of its third-party vendors provisions addressing its requirements and industry best practices with respect to data and cybersecurity, as well as the right to assess, monitor, audit and test such vendors’ cybersecurity programs and practices.
Stecher received a B.S. in Computer Science from the University of Wisconsin — Madison and a M.S. in Computer Science from the University of Minnesota. BXTI conducts periodic cybersecurity risk assessments, including assessments or audits of third-party vendors, and assists with the management and mitigation of identified cybersecurity risks.
BXTI conducts periodic cybersecurity risk assessments, including assessments or audits of third-party vendors, and assists with the management and mitigation of identified cybersecurity risks. The CSO and CTO are responsible for the review of Blackstone’s cybersecurity framework annually as well as on an event-driven basis as necessary.
Our CSO, Adam Fletcher, is a Senior Managing Director in BXTI and is responsible for all aspects of cyber and physical security across Blackstone. Prior to his appointment as CSO in 2017, Mr. Fletcher was Blackstone’s Deputy CSO. Before joining Blackstone in 2014, Mr. Fletcher led the International Security organization for Equifax from 2012 to 2014. Mr.
Our CSO is a Senior Managing Director in BXTI and is responsible for all aspects of cyber and physical security across Blackstone. He has over 25 years of information security, technology and engineering experience, including having previously led the international security organization at a large credit bureau. Our CTO is a Senior Managing Director and the head of BXTI.
Fletcher received a B.S. in Operations Research and Industrial Engineering from Cornell University. 82 Table of Contents Our CTO, John Stecher is a Senior Managing Director and head of BXTI. Mr. Stecher is responsible for all aspects of technology across Blackstone. Mr. Stecher also advises our investment teams and acts as a resource to portfolio companies on technology-related matters.
Our CTO has over 23 years of information security, technology and engineering experience, including having previously served as the Chief Technology and Chief Innovation Officer at a large financial institution. Our CTO is responsible for all aspects of technology across Blackstone, advises our investment teams and acts as a resource to portfolio companies on technology-related matters.
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On the basis of its preliminary risk assessment of a third-party vendor, Blackstone may conduct further cybersecurity reviews or request remediation of, or contractual protections related to, any actual or potential identified cybersecurity risks.
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Before joining Blackstone in 2020, Mr. Stecher was a Managing Director and the Chief Technology Officer and Chief Innovation Officer at Barclays. He was also a member of the Barclays Technology Management Committee. Prior to joining Barclays in 2017, Mr. Stecher held a variety of senior management and engineering roles across Goldman Sachs’ capital markets and technology divisions. Mr.
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Blackstone’s board of directors is responsible for understanding the primary risks to our business.

Item 2. Properties

Properties — owned and leased real estate

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Item 2. Properties Our principal executive offices are located in leased office space at 345 Park Avenue, New York, New York. As of December 31, 2023, in addition to our offices in New York, we also leased offices in Hong Kong, London, Miami, San Francisco, Singapore, Tokyo and other cities around the world.
Item 2. Properties Our principal executive offices are located in leased office space at 345 Park Avenue, New York, New York. As of December 31, 2024, in addition to our offices in New York, we also leased offices in Hong Kong, London, Miami, New Jersey, San Francisco, Singapore, Tokyo and other cities around the world.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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However, given the inherent unpredictability of these types of proceedings and the potentially large and/or indeterminate amounts that could be sought, an adverse outcome in certain matters could have a material effect on Blackstone’s financial results in any particular period. See “Part II. Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 19.
However, given the inherent unpredictability of these types of proceedings and the potentially large and/or indeterminate amounts that could be sought, an adverse outcome in certain matters could have a material effect on Blackstone’s financial results in any particular period. See “Part II. Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 18.
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Commitments and Contingencies — Contingencies — Litigation.” Item 4. Mine Safety Disclosures Not applicable. 83 Table of Contents Part II.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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The repurchase program may be changed, suspended or discontinued at any time and does not have a specified expiration date. See “— Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 16. Earnings Per Share and Stockholders’ Equity — Share Repurchase Program” and “— Item 7.
The repurchase program may be changed, suspended or discontinued at any time and does not have a specified expiration date. See “— Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 15. Earnings Per Share and Stockholders’ Equity — Share Repurchase Program” and “— Item 7.
Because the publicly traded entity and/or its wholly owned subsidiaries must pay taxes and make payments under the tax receivable agreements described in “— Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 18.
Because the publicly traded entity and/or its wholly owned subsidiaries must pay taxes and make payments under the tax receivable agreements described in “— Item 8. Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 17.
Each quarter’s dividends are declared and paid in the following quarter. 2023 2022 First Quarter $ 0.82 $ 1.32 Second Quarter 0.79 1.27 Third Quarter 0.80 0.90 Fourth Quarter 0.94 0.91 $ 3.35 $ 4.40 Dividend Policy Our intention is to pay to holders of common stock a quarterly dividend representing approximately 85% of Blackstone Inc.’s share of Distributable Earnings, subject to adjustment by amounts determined by our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as tax-related payments, clawback obligations and dividends to stockholders for any ensuing quarter.
Each quarter’s dividends are declared and paid in the following quarter. 2024 2023 First Quarter $ 0.83 $ 0.82 Second Quarter 0.82 0.79 Third Quarter 0.86 0.80 Fourth Quarter 1.44 0.94 $ 3.95 $ 3.35 Dividend Policy Our intention is to pay to holders of common stock a quarterly dividend representing approximately 85% of Blackstone Inc.’s share of Distributable Earnings, subject to adjustment by amounts determined by our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as tax-related payments, clawback obligations and dividends to stockholders for any ensuing quarter.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “BX.” The number of holders of record of our common stock as of February 16, 2024 was 65.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “BX.” The number of holders of record of our common stock as of February 21, 2025 was 60.
Under the repurchase program, repurchases may be made from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual numbers repurchased will depend on a variety of factors, including legal requirements, price and economic and market conditions.
This authorization replaced Blackstone’s prior $2.0 billion repurchase authorization. Under the repurchase program, repurchases may be made from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual numbers repurchased will depend on a variety of factors, including legal requirements, price and economic and market conditions.
Share Repurchases in the Fourth Quarter of 2023 The following table sets forth information regarding repurchases of shares of our common stock during the quarter ended December 31, 2023: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (Dollars in Thousands) (a) Oct. 1 - Oct. 31, 2023 — $ — — $ 797,628 Nov. 1 - Nov. 30, 2023 399,994 $ 102.15 399,994 $ 756,769 Dec. 1 - Dec. 31, 2023 — $ — — $ 756,769 399,994 399,994 (a) On December 7, 2021, Blackstone’s board of directors authorized the repurchase of up to $2.0 billion of common stock and Blackstone Holdings Partnership Units.
Share Repurchases in the Fourth Quarter of 2024 The following table sets forth information regarding repurchases of shares of our common stock during the quarter ended December 31, 2024: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (Dollars in Thousands) (a) Oct. 1 - Oct. 31, 2024 77,777 $ 169.32 77,777 $ 1,846,014 Nov. 1 - Nov. 30, 2024 186,576 $ 180.89 186,576 $ 1,812,265 Dec. 1 - Dec. 31, 2024 — $ — — $ 1,812,265 264,353 264,353 (a) On July 16, 2024, Blackstone’s board of directors authorized the repurchase of up to $2.0 billion of common stock and Blackstone Holdings Partnership Units.
Removed
Following Blackstone’s conversion from a limited partnership to a corporation, we expect to pay more corporate income taxes than we would have as a limited partnership, which will increase this difference between the per share dividend and per unit distribution amounts.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Item 6. (Reserved) 86 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 86 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 149 Item 8. Financial Statements and Supplementary Data 153 Item 8A. Unaudited Supplemental Presentation of Statements of Financial Condition 228
Item 6. (Reserved) 86 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 86 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 148 Item 8. Financial Statements and Supplementary Data 152 Item 8A. Unaudited Supplemental Presentation of Statements of Financial Condition 225

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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The amounts of these items vary directly with the performance of the consolidated Blackstone Funds and largely eliminate the amount of Other Income (Loss) — Net Gains (Losses) from Fund Investment Activities from the Net Income (Loss) Attributable to Blackstone Inc.
The amounts of these items vary directly with the performance of the consolidated Blackstone Funds and largely eliminate the amount of Other Income (Loss) — Net Gains (Losses) from Fund Investment Activities from the Net Income Attributable to Blackstone Inc.
Transaction-Related and Non-Recurring Items arise from corporate actions including acquisitions, divestitures, Blackstone’s initial public offering and non-recurring gains, losses, or other charges, if any.
Transaction-Related and Non-Recurring Items arise from corporate actions including acquisitions, divestitures, Blackstone’s initial public offering and non-recurring gains, losses, or other charges, if any.
A discount to publicly traded price may be appropriate in instances where a legal restriction is a characteristic of the security, such as may be required under SEC Rule 144. The amount of the discount, if taken, shall be determined based on the time period that must pass before the restricted security becomes unrestricted or otherwise available for sale.
A discount to the publicly traded price may be appropriate in instances where a legal restriction is a characteristic of the security, such as may be required under SEC Rule 144. The amount of the discount, if taken, shall be determined based on the time period that must pass before the restricted security becomes unrestricted or otherwise available for sale.
Principles of Consolidation For a description of our accounting policy on consolidation, see Note 2. “Summary of Significant Accounting Policies — Consolidation” and Note 9. “Variable Interest Entities” in the “Notes to Consolidated Financial Statements” in “— Item 8. Financial Statements and Supplementary Data” for detailed information on Blackstone’s involvement with VIEs.
Principles of Consolidation For a description of our accounting policy on consolidation, see Note 2. “Summary of Significant Accounting Policies — Consolidation” and Note 8. “Variable Interest Entities” in the “Notes to Consolidated Financial Statements” in “ — Item 8. Financial Statements and Supplementary Data” for detailed information on Blackstone’s involvement with VIEs.
For investments valued utilizing the income method and where Blackstone has information rights, we generally have a direct line of communication with each of the Portfolio Companies’ and underlying assets’ finance teams and collect financial data used to support projections used in a discounted cash flow analysis.
For investments valued utilizing the income method and where Blackstone has information rights, we generally have a direct line of communication with each of the companies’ and underlying assets’ finance teams and collect financial data used to support projections used in a discounted cash flow analysis.
Additionally, significant judgment is required in estimating the provision for (benefit from) income taxes, current and deferred tax balances (including valuation allowance), accrued interest or penalties and uncertain tax positions.
Additionally, significant judgment is required in estimating the provision for (benefit from) income taxes, current and deferred tax balances (including any valuation allowance), accrued interest or penalties and uncertain tax positions.
(m) Unless otherwise indicated, Total Net Return represents the annualized inception to December 31, 2023 IRR on total invested capital based on realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues. IRRs are calculated using actual timing of investor cash flows. Initial inception date of cash flows occurred during the Inception Year.
(m) Unless otherwise indicated, Total Net Return represents the annualized inception to December 31, 2024 IRR on total invested capital based on realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues. IRRs are calculated using actual timing of investor cash flows. Initial inception date of cash flows occurred during the Inception Year.
The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation. 132 Table of Contents (j) Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes and adjusted to exclude the tax impact of any divestitures.
The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation. 130 Table of Contents (j) Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes and adjusted to exclude the tax impact of any divestitures.
As of December 31, 2023, BREP VII, BREP VI, BREP V, BREP IV, BREP Europe IV, BREP Europe III and BREP Asia I were above their carried interest thresholds (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would have been above their carried interest thresholds even if all remaining investments were valued at zero.
As of December 31, 2024, BREP VII, BREP VI, BREP V, BREP Europe VI, BREP Europe IV, BREP Europe III and BREP Asia I were above their carried interest thresholds (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would have been above their carried interest thresholds even if all remaining investments were valued at zero.
Blackstone had a corporate alternative minimum tax (“CAMT”) liability for the year ended December 31, 2023 as calculated pursuant to the Inflation Reduction Act. Blackstone will continue to assess the overall impact to its Provision for Income Tax upon the issuance of applicable additional guidance by the U.S. Treasury Department related to interpretations of CAMT.
Blackstone had a corporate alternative minimum tax (“CAMT”) liability for the year ended December 31, 2024 as calculated pursuant to the Inflation Reduction Act. Blackstone will continue to assess the overall impact to its Provision for Income Tax upon the issuance of applicable additional guidance by the U.S. Treasury Department related to interpretations of CAMT.
The Notes contain customary covenants and financial restrictions that, among other things, limit the Issuer and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The Notes also contain customary events of default.
The Notes contain customary covenants and financial restrictions that, among other things, limit the Issuers and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The Notes also contain customary events of default.
As of December 31, 2023, BCP IV was above its carried interest threshold (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would still be above its carried interest threshold even if all remaining investments were valued at zero.
As of December 31, 2024, BCP IV was above its carried interest threshold (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would still be above its carried interest threshold even if all remaining investments were valued at zero.
In certain structures, we receive a contractual incentive fee from an investment fund based on achieving certain investment returns (an “Incentive Fee,” and together with Performance Allocations, “Performance Revenues”). The composition of our revenues will vary based on market conditions and the cyclicality of the different businesses in which we operate.
In certain structures, we receive a contractual incentive fee from an investment vehicle based on achieving certain investment returns (an “Incentive Fee,” and together with Performance Allocations, “Performance Revenues”). The composition of our revenues will vary based on market conditions and the cyclicality of the different businesses in which we operate.
Each quarter, the valuation process is also reviewed by the audit committee of our board of directors, which is comprised of our non-employee directors. Income Tax For a description of our accounting policy on taxes and additional information on taxes see Note 2. “Summary of Significant Accounting Policies” and Note 15.
Each quarter, the valuation process is also reviewed by the audit committee of our board of directors, which is comprised of our non-employee directors. Income Tax For a description of our accounting policy on taxes and additional information on taxes see Note 2. “Summary of Significant Accounting Policies” and Note 14.
BCP V, BCP VI, BCP VII, BCOM, BEP I, BEP II, BCEP I and BCP Asia I were above their respective carried interest thresholds. Funds are considered above their carried interest thresholds based on the aggregate fund position, although individual limited partners may be below their respective carried interest thresholds in certain funds.
BCP V, BCP VI, BCP VII, BCP VIII, BCOM, BEP I, BEP II, BEP III, BCEP I and BCP Asia I were above their respective carried interest thresholds. Funds are considered above their carried interest thresholds based on the aggregate fund position, although individual limited partners may be below their respective carried interest thresholds in certain funds.
Dividends are treated as qualified dividends to the extent of Blackstone’s current and accumulated earnings and profits, with any excess dividends treated as a return of capital to the extent of the stockholder’s basis. The following graph shows fiscal quarterly and annual per common stockholder dividends for 2023, 2022 and 2021.
Dividends are treated as qualified dividends to the extent of Blackstone’s current and accumulated earnings and profits, with any excess dividends treated as a return of capital to the extent of the stockholder’s basis. The following graph shows fiscal quarterly and annual per common stockholder dividends for 2024, 2023 and 2022.
Net investment gains and investment income generated by the Blackstone Funds are driven by the performance of the underlying investments as well as overall market conditions. Fair values are affected by changes in the fundamentals of our investments, the industries in which they operate, the overall economy and other market conditions.
Net investment gains and investment income generated by the Blackstone Funds are driven by the performance of the underlying investments as well as overall market conditions. Fair values are affected by changes in the fundamentals of our portfolio companies and other investments, the industries in which they operate, the overall economy and other market conditions.
In making this judgment, we consider, among other things, the extent of third party investment in the entity and the terms of any other interests we hold in the VIE. • Determining whether kick-out rights are substantive — We make judgments as to whether the third party investors in a partnership entity have the ability to remove the general partner, the investment manager or its equivalent, or to dissolve (liquidate) the partnership entity, through a simple majority vote.
In making this judgment, we consider, among other things, the extent of third-party investment in the entity and the terms of any other interests we hold in the VIE. 143 Table of Contents • Determining whether kick-out rights are substantive — We make judgments as to whether the third-party investors in a partnership entity have the ability to remove the general partner, the investment manager or its equivalent, or to dissolve (liquidate) the partnership entity, through a simple majority vote.
Guarantees Blackstone and certain of its consolidated funds provide financial guarantees. The amounts and nature of these guarantees are described in Note 19. “Commitments and Contingencies — Contingencies — Guarantees” in the “Notes to Consolidated Financial Statements” in “— Item 8. Financial Statements and Supplementary Data” of this filing.
Guarantees Blackstone and certain of its consolidated funds provide financial guarantees. The amounts and nature of these guarantees are described in Note 18. “Commitments and Contingencies — Contingencies — Guarantees” in the “Notes to Consolidated Financial Statements” in “— Item 8. Financial Statements and Supplementary Data” of this filing.
“Income Taxes,” in the “Notes to Consolidated Financial Statements” in “— Item 8. Financial Statements and Supplementary Data” of this filing. Our provision for income taxes is composed of current and deferred taxes. Current income taxes approximate taxes to be paid or refunded for the current period.
“Income Taxes,” in the “Notes to Consolidated Financial Statements” in “ — Item 8. Financial Statements and Supplementary Data” of this filing. Our provision for income taxes is comprised of current and deferred taxes. Current income taxes approximate taxes to be paid or refunded for the current period.
These judgments are applied both at the time we become involved with the VIE and on an ongoing basis and include, but are not limited to: 144 Table of Contents • Determining whether our management fees, Incentive Fees or Performance Allocations represent variable interests — We make judgments as to whether the fees we earn are commensurate with the level of effort required for those fees and at market rates.
These judgments are applied both at the time we become involved with the VIE and on an ongoing basis and include, but are not limited to: • Determining whether our management fees, Incentive Fees or Performance Allocations represent variable interests — We make judgments as to whether the fees we earn are commensurate with the level of effort required for those fees and at market rates.
Operating Metrics Total and Fee-Earning Assets Under Management The following graphs and tables summarize the Fee-Earning Assets Under Management by Segment and Total Assets Under Management by Segment, followed by a rollforward of activity for the years ended December 31, 2023, 2022 and 2021.
Operating Metrics Total and Fee-Earning Assets Under Management The following graphs and tables summarize the Total Assets Under Management by Segment and Fee-Earning Assets Under Management by Segment, followed by a rollforward of activity for the years ended December 31, 2024, 2023 and 2022.
(p) This adjustment adds back Depreciation and Amortization on a segment basis. 133 Table of Contents The following tables are a reconciliation of Total GAAP Investments to Net Accrued Performance Revenues.
(p) This adjustment adds back Depreciation and Amortization on a segment basis. 131 Table of Contents The following tables are a reconciliation of Total GAAP Investments to Net Accrued Performance Revenues.
See “— Non-GAAP Financial Measures” for our reconciliation of Adjusted EBITDA. 90 Table of Contents Net Accrued Performance Revenues Net Accrued Performance Revenues is a non-GAAP financial measure Blackstone believes is useful to stockholders as an indicator of potential future realized performance revenues based on the current investment portfolio of the funds and vehicles we manage.
See “— Non-GAAP Financial Measures” for our reconciliation of Adjusted EBITDA. Net Accrued Performance Revenues Net Accrued Performance Revenues is a non-GAAP financial measure Blackstone believes is useful to stockholders as an indicator of potential future realized performance revenues based on the current investment portfolio of the funds and vehicles we manage.
Financial Statements and Supplementary Data” for additional information on the calculation of Investments — Accrued Performance Allocations. Operating Metrics The alternative asset management business is primarily based on managing third party capital and does not require substantial capital investment to support rapid growth.
Financial Statements and Supplementary Data” for additional information on the calculation of Investments — Accrued Performance Allocations. 90 Table of Contents Operating Metrics The alternative asset management business is primarily based on managing third-party capital and does not require substantial capital investment to support rapid growth.
Management fee calculations based on net asset value, total assets, or investment fair value depend on the fair value of the underlying investments within the funds. Estimates and assumptions are made when determining the fair value of the underlying investments within the funds and could vary depending on the valuation methodology that is used as well as economic conditions.
Management fee calculations based on net asset value, gross asset value, or investment fair value depend on the fair value of the underlying investments within the funds. Estimates and assumptions are made when determining the fair value of the underlying investments within the funds and could vary depending on the valuation methodology that is used as well as economic conditions.
(n) BPP represents the aggregate Total Assets Under Management and Total Net Return of the BPP Platform, which comprises over 30 funds, co-investment and separately managed account vehicles. It includes certain vehicles managed as part of the BPP Platform but not classified as Perpetual Capital. As of December 31, 2023, these vehicles represented $2.7 billion of Total Assets Under Management.
(n) BPP represents the aggregate Total Assets Under Management and Total Net Return of the BPP Platform, which comprises over 30 funds, co-investment and separately managed account vehicles. It includes certain vehicles managed as part of the BPP Platform but not classified as Perpetual Capital. As of December 31, 2024, these vehicles represented $2.8 billion of Total Assets Under Management.
Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 15. Income Taxes” of this filing. Non-Controlling Interests in Consolidated Entities The Net Income Attributable to Redeemable Non-Controlling Interests in Consolidated Entities and Net Income Attributable to Non-Controlling Interests in Consolidated Entities is attributable to the consolidated Blackstone Funds.
Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 14. Income Taxes” of this filing. Non-Controlling Interests in Consolidated Entities The Net Loss Attributable to Redeemable Non-Controlling Interests in Consolidated Entities and Net Income Attributable to Non-Controlling Interests in Consolidated Entities is attributable to the consolidated Blackstone Funds.
BREP IX, BREP VIII, BREP Europe VI, BREP Europe V, BREDS IV and BREDS III were above their carried interest thresholds as of December 31, 2023, and BREP Asia II was below its carried interest threshold.
BREP IX, BREP VIII, BREP Europe V, BREDS IV and BREDS III were above their carried interest thresholds as of December 31, 2024, and BREP Asia II was below its carried interest threshold.
(b) Includes the full portion of our commitments (i) required to be funded by senior managing directors and certain other professionals and (ii) that are elected by such individuals to be funded for the life of a fund, where such fund permits such election.
(b) Includes the full portion of our commitments (1) required to be funded by senior managing directors and certain other professionals and (2) that are elected by such individuals to be funded for the life of a fund, where such fund permits such election.
With respect to fiscal years 2022 and 2021, we paid stockholders of our common stock aggregate dividends of $4.40 per share and $4.06 per share, respectively. Leverage We may under certain circumstances use leverage opportunistically and over time to create the most efficient capital structure for Blackstone and our stockholders.
With respect to fiscal years 2023 and 2022, we paid stockholders of our common stock aggregate dividends of $3.35 per share and $4.40 per share, respectively. Leverage We may under certain circumstances use leverage opportunistically and over time to create the most efficient capital structure for Blackstone and our stockholders.
Net Accrued Performance Revenues The following table presents the Accrued Performance Revenues, net of performance compensation, of the Blackstone Funds as of December 31, 2023 and 2022. Net Accrued Performance Revenues presented do not include clawback amounts, if any, which are disclosed in Note 19.
Net Accrued Performance Revenues The following table presents the Accrued Performance Revenues, net of performance compensation, of the Blackstone Funds as of December 31, 2024 and 2023. Net Accrued Performance Revenues presented do not include clawback amounts, if any, which are disclosed in Note 18.
Funds With Closed Investment Periods The Real Estate segment has fourteen funds with closed investment periods as of December 31, 2023: BREP IX, BREP VIII, BREP VII, BREP VI, BREP V, BREP IV, BREP Europe VI, BREP Europe V, BREP Europe IV, BREP Europe III, BREP Asia II, BREP Asia I, BREDS IV and BREDS III.
Funds with Closed Investment Periods as of December 31, 2024 The Real Estate segment has thirteen funds with closed investment periods as of December 31, 2024: BREP IX, BREP VIII, BREP VII, BREP VI, BREP V, BREP Europe VI, BREP Europe V, BREP Europe IV, BREP Europe III, BREP Asia II, BREP Asia I, BREDS IV and BREDS III.
Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/ Benchmarks as of December 31, 2023, 9% were within 5% of reaching their respective High Water Mark. 129 Table of Contents Non-GAAP Financial Measures These non-GAAP financial measures are presented without the consolidation of any Blackstone Funds that are consolidated into the Consolidated Financial Statements.
Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/Benchmarks as of December 31, 2024, 5% were within 5% of reaching their respective High Water Mark. Non-GAAP Financial Measures These non-GAAP financial measures are presented without the consolidation of any Blackstone Funds that are consolidated into the consolidated financial statements.
Generally, Blackstone Funds are accounted for as investment companies under the American Institute of Certified Public Accountants Audit and Accounting Guide, Investment Companies , and in accordance with the GAAP guidance on investment companies and reflect their investments, including majority-owned and controlled investments (the “Portfolio Companies”), at fair value.
Generally, Blackstone Funds are accounted for in accordance with the GAAP guidance on investment companies, and under the American Institute of Certified Public Accountants Audit and Accounting Guide, Investment 145 Table of Contents Companies , and reflect their investments, including majority-owned and controlled investments, at fair value.
For a tabular presentation of the timing of Blackstone’s remaining capital commitments to our funds, the funds we invest in and our investment strategies see “— Contractual Obligations”. 138 Table of Contents Borrowings As of December 31, 2023, Blackstone Holdings Finance Co. L.L.C.
For a tabular presentation of the timing of Blackstone’s remaining capital commitments to our funds, the funds we invest in and our investment strategies see “— Contractual Obligations”. Borrowings As of December 31, 2024, Blackstone Holdings Finance Co. L.L.C. and Blackstone Reg Finance Co. L.L.C.
Year Ended December 31, 2023 2022 2021 (Dollars in Thousands) GAAP Unrealized Performance Allocations $ (1,691,668 ) $ (3,435,056 ) $ 8,675,246 Segment Adjustment (120 ) (1,922 ) — Unrealized Performance Revenues $ (1,691,788 ) $ (3,436,978 ) $ 8,675,246 (e) This adjustment removes Unrealized Performance Allocations Compensation. (f) This adjustment removes Unrealized Principal Investment Income on a segment basis.
Year Ended December 31, 2024 2023 2022 (Dollars in Thousands) GAAP Unrealized Performance Allocations $ 371,407 $ (1,691,668 ) $ (3,435,056 ) Segment Adjustment — (120 ) (1,922 ) Unrealized Performance Revenues $ 371,407 $ (1,691,788 ) $ (3,436,978 ) (e) This adjustment removes Unrealized Performance Allocations Compensation. (f) This adjustment removes Unrealized Principal Investment Income on a segment basis.
Management Fees, Net were $2.8 billion for the year ended December 31, 2023, an increase of $220.3 million, compared to $2.6 billion for the year ended December 31, 2022, primarily driven by an increase in Base Management Fees, partially offset by a decrease in Transaction and Other Fees, Net.
Management Fees, Net were $2.9 billion for the year ended December 31, 2024, an increase of $31.9 million, compared to $2.8 billion for the year ended December 31, 2023, primarily driven by an increase in Transaction and Other Fees, Net, partially offset by a decrease in Base Management Fees.
(a) Composite returns present a summarized asset-weighted return measure to evaluate the overall performance of the applicable class of Blackstone Funds. (b) BAAM’s Principal Solutions (“BPS”) Composite covers the period from January 2000 to present, although BAAM’s inception date is September 1990.
(a) Composite returns present a summarized asset-weighted return measure to evaluate the overall performance of the applicable class of Blackstone Funds. (b) Absolute Return Composite covers the period from January 2000 to present, although BXMA’s inception date is September 1990.
(a) Real Estate and Private Equity include co-investments, as applicable For the year ended December 31, 2023, Net Accrued Performance Revenues receivable decreased due to net realized distributions of $1.8 billion, partially offset by Net Performance Revenues of $765.7 million. 106 Table of Contents Invested Performance Eligible Assets Under Management The following presents our Invested Performance Eligible Assets Under Management as of December 31 of each year: Note: Totals may not add due to rounding. 107 Table of Contents Perpetual Capital The following presents our Perpetual Capital Total Assets Under Management as of December 31 of each year: Note: Totals may not add due to rounding.
(a) Real Estate and Private Equity include co-investments, as applicable For the year ended December 31, 2024, Net Accrued Performance Revenues receivable increased due to Net Performance Revenues of $3.1 billion, partially offset by net realized distributions of $2.7 billion. 105 Table of Contents Invested Performance Eligible Assets Under Management The following presents our Invested Performance Eligible Assets Under Management as of December 31 of each year: Note: Totals may not add due to rounding. 106 Table of Contents Perpetual Capital The following presents our Perpetual Capital Total Assets Under Management as of December 31 of each year: Note: Totals may not add due to rounding.
(the “Issuer”), an indirect subsidiary of Blackstone, had issued and outstanding the following senior notes (collectively the “Notes”): Senior Notes (a) Aggregate Principal Amount (Dollars/Euros in Thousands) 2.000%, Due 5/19/2025 € 300,000 1.000%, Due 10/5/2026 € 600,000 3.150%, Due 10/2/2027 $ 300,000 5.900%, Due 11/3/2027 $ 600,000 1.625%, Due 8/5/2028 $ 650,000 1.500%, Due 4/10/2029 € 600,000 2.500%, Due 1/10/2030 $ 500,000 1.600%, Due 3/30/2031 $ 500,000 2.000%, Due 1/30/2032 $ 800,000 2.550%, Due 3/30/2032 $ 500,000 6.200%, Due 4/22/2033 $ 900,000 3.500%, Due 6/1/2034 € 500,000 6.250%, Due 8/15/2042 $ 250,000 5.000%, Due 6/15/2044 $ 500,000 4.450%, Due 7/15/2045 $ 350,000 4.000%, Due 10/2/2047 $ 300,000 3.500%, Due 9/10/2049 $ 400,000 2.800%, Due 9/30/2050 $ 400,000 2.850%, Due 8/5/2051 $ 550,000 3.200%, Due 1/30/2052 $ 1,000,000 $ 10,707,800 (a) The Notes are unsecured and unsubordinated obligations of the Issuer and are fully and unconditionally guaranteed, jointly and severally, by Blackstone Inc. and each of the Blackstone Holdings Partnerships.
(each an “Issuer” and together the “Issuers”), both indirect subsidiaries of Blackstone, had issued and outstanding the following senior notes (collectively the “Notes”): 137 Table of Contents Senior Notes (a) Aggregate Principal Amount (Dollars/Euros in Thousands) 2.000%, Due 5/19/2025 € 300,000 1.000%, Due 10/5/2026 € 600,000 3.150%, Due 10/2/2027 $ 300,000 5.900%, Due 11/3/2027 $ 600,000 1.625%, Due 8/5/2028 $ 650,000 1.500%, Due 4/10/2029 € 600,000 2.500%, Due 1/10/2030 $ 500,000 1.600%, Due 3/30/2031 $ 500,000 2.000%, Due 1/30/2032 $ 800,000 2.550%, Due 3/30/2032 $ 500,000 6.200%, Due 4/22/2033 $ 900,000 3.500%, Due 6/1/2034 € 500,000 5.000%, Due 12/6/2034 (b) $ 750,000 6.250%, Due 8/15/2042 $ 250,000 5.000%, Due 6/15/2044 $ 500,000 4.450%, Due 7/15/2045 $ 350,000 4.000%, Due 10/2/2047 $ 300,000 3.500%, Due 9/10/2049 $ 400,000 2.800%, Due 9/30/2050 $ 400,000 2.850%, Due 8/5/2051 $ 550,000 3.200%, Due 1/30/2052 $ 1,000,000 $ 11,320,800 (a) The Notes are unsecured and unsubordinated obligations of the Issuers, as applicable, and are fully and unconditionally guaranteed, jointly and severally, by Blackstone Inc. and each of the Blackstone Holdings Partnerships (the “Guarantors”).
Financial Statements and Supplementary Data.” 87 Table of Contents Organizational Structure The simplified diagram below depicts our current organizational structure. The diagram does not depict all of our subsidiaries, including intermediate holding companies through which certain of the subsidiaries depicted are held.
Financial Statements and Supplementary Data” and “— Liquidity and Capital Resources —Sources and Uses of Liquidity.” 87 Table of Contents Organizational Structure The simplified diagram below depicts our current organizational structure. The diagram does not depict all of our subsidiaries, including intermediate holding companies through which certain of the subsidiaries depicted are held.
Sources and Uses of Liquidity We have multiple sources of liquidity to meet our capital needs, including annual cash flows, accumulated earnings in our businesses, the proceeds from our issuances of senior notes, liquid investments we hold on our balance sheet and access to our committed revolving credit facility.
We have multiple sources of liquidity to meet our capital needs, including annual cash flows, accumulated earnings in our businesses, the proceeds from our issuances of senior notes and other borrowings, liquid investments we hold on our balance sheet and access to our $4.325 billion committed revolving credit facility (the “Revolving Credit Facility”).
This resulted in an effective tax rate of 17.4% and 13.7% based on our Income Before Provision for Taxes of $3.0 billion and $3.5 billion for the years ended December 31, 2023 and 2022, respectively.
This resulted in an effective tax rate of 15.8% and 17.4% based on our Income Before Provision for Taxes of $6.5 billion and $3.0 billion for the years ended December 31, 2024 and 2023, respectively.
(l) Represents the performance for select Perpetual Capital Strategies; strategies excluded consist primarily of (1) investment strategies that have been investing for less than one year, (2) perpetual capital assets managed for certain insurance clients, and (3) investment vehicles where Blackstone does not earn fees.
The Total Credit Net IRR is the combined IRR of the credit drawdown funds presented. (l) Represents the performance for select Perpetual Capital Strategies; strategies excluded consist primarily of (1) investment strategies that have been investing for less than one year, (2) perpetual capital assets managed for certain insurance clients, and (3) investment vehicles where Blackstone does not earn fees.
(f) Blackstone is not able to make a reasonably reliable estimate of the timing of payments in individual years in connection with gross unrecognized benefits of $210.8 million and interest of $60.8 million as of December 31, 2023; therefore, such amounts are not included in the above contractual obligations table.
(f) Blackstone is not able to make a reasonably reliable estimate of the timing of payments in individual years in connection with gross unrecognized benefits of $250.9 million and interest of $87.3 million as of December 31, 2024; therefore, such amounts are not included in the above contractual obligations table.
In the year ended December 31, 2023, Realized Performance Compensation was increased by an aggregate of $65.0 million and Fee Related Compensation was decreased by a corresponding amount. In the year ended December 31, 2022, Realized Performance Compensation was increased by an aggregate of $77.0 million and Fee Related Compensation decreased by a corresponding amount.
In the year ended December 31, 2024, Realized Performance Compensation increased by an aggregate of $83.1 million and Fee Related Compensation decreased by a corresponding amount. In the year ended December 31, 2023, Realized Performance Compensation increased by an aggregate of $65.0 million and Fee Related Compensation decreased by a corresponding amount.
The obligation represents the amount of the payments currently expected to be made, which are dependent on the tax savings actually realized as determined annually without discounting for the timing of the payments. As required by GAAP, the amount of the obligation included in the Consolidated Financial Statements and shown in Note 18. “Related Party Transactions” (see “— Item 8.
The obligation represents the amount of the payments currently expected to be made, which are dependent on the tax savings actually realized as determined annually without discounting for the timing of the payments. As required by GAAP, the amount of the obligation included in the consolidated financial statements and shown in Note 17.
Since our inception, we have developed and used various key operating metrics to assess and monitor the operating performance of our various alternative asset management businesses in order to monitor the effectiveness of our value creating strategies. Total and Fee-Earning Assets Under Management Total Assets Under Management refers to the assets we manage.
Since our inception, we have developed and used various key operating metrics to assess and monitor the operating performance of our various alternative asset management businesses in order to monitor the effectiveness of our value creating strategies.
The Tactical Opportunities funds within the Private Equity segment have various funds with closed investment periods, including but not limited to: BTOF-POOL, BTOF-POOL II, and BTOF-POOL III, which are each above their carried interest thresholds based on aggregate fund position.
Tactical Opportunities funds have various funds with closed investment periods, including but not limited to: BTOF-POOL, BTOF-POOL II, and BTOF-POOL III, which are each above their carried interest thresholds based on aggregate fund position. Blackstone Growth funds have no funds with closed investment periods.
Conversely, outperformance by our Hedge Fund Solutions strategies in a weak market environment has in some cases resulted in such strategies representing an increasing portion of the value of certain investors’ portfolios, which may limit such investors’ ability to allocate additional capital to certain funds in the segment, or result in 127 Table of Contents such investors seeking to withdraw capital from such funds.
Outperformance by our Multi-Asset Investing segment strategies in a weak market environment has in some cases resulted in such strategies representing an increasing portion of the value of certain investors’ portfolios, which may limit such investors’ ability to allocate additional capital to certain funds in the segment, or result in such investors seeking to withdraw capital from such funds.
Additionally, fluctuations in our statement of financial condition also include appreciation or depreciation in Blackstone investments in the non-consolidated Blackstone Funds, additional investments and redemptions of such interests in the non-consolidated Blackstone Funds and the collection of receivables related to management and advisory fees. 134 Table of Contents Total Assets were $40.3 billion as of December 31, 2023, a decrease of $2.2 billion from December 31, 2022.
Additionally, fluctuations in our statement of financial condition also include appreciation or depreciation in Blackstone investments in the non-consolidated Blackstone Funds, additional investments and redemptions of such interests in the non-consolidated Blackstone Funds and the collection of receivables related to management and advisory fees. 132 Table of Contents Total Assets were $43.5 billion as of December 31, 2024, an increase of $3.2 billion from December 31, 2023.
(c) This adjustment reverses the effect of consolidating Blackstone Funds, which are excluded from Blackstone’s segment presentation. This adjustment includes the elimination of Blackstone’s interest in these funds and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests. (d) This adjustment removes Unrealized Performance Revenues on a segment basis.
This adjustment includes the elimination of Blackstone’s interest in these funds and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests. (d) This adjustment removes Unrealized Performance Revenues on a segment basis.
These returns are not representative of the returns experienced by any particular investor or share class. Inception to date returns are presented on an annualized basis and are from January 1, 2017. (f) Represents the Total Net Return for BREIT’s Class I shares, its largest share class. Performance varies by share class.
These returns are not representative of the returns experienced by any particular vehicle, investor or share class. Inception to date returns are presented on an annualized basis and are from January 2, 2024. (f) Represents the blended Total Net Return for BXPE’s Class I shares, its largest share class across vehicles. Performance varies by vehicle and share class.
They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs, gains or losses associated with these corporate actions and non-recurring gains, losses or other charges that affect period-to-period comparability and are not reflective of Blackstone’s operational performance. 131 Table of Contents (b) This adjustment removes the amortization of transaction-related intangibles, which are excluded from Blackstone’s segment presentation.
They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs, gains or losses associated with these corporate actions and non-recurring gains, losses or other charges that affect period-to-period comparability and are not reflective of Blackstone’s operational performance.
For the year ended December 31, 2023 there is no meaningful CAMT impact reflected in the Provision for Income Taxes given current year tax payments made under CAMT are permitted to be carried forward and used as credits in future years resulting in a deferred tax benefit.
For the year ended December 31, 2024 there is no meaningful CAMT impact reflected in the Provision for Income Taxes given current year tax payments made under CAMT are permitted to be carried forward and used as credits in future years resulting in a deferred tax benefit. Additional information regarding our income taxes can be found in “— Item 8.
Fee Related Earnings Fee Related Earnings were $2.1 billion for the year ended December 31, 2023, a decrease of $207.4 million, compared to $2.3 billion for the year ended December 31, 2022.
Fee Related Earnings Fee Related Earnings were $2.0 billion for the year ended December 31, 2024, a decrease of $113.3 million, compared to $2.1 billion for the year ended December 31, 2023.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Segment Distributable Earnings were $1.2 billion for the year ended December 31, 2023, an increase of $166.4 million, compared to $1.0 billion for the year ended December 31, 2022.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Segment Distributable Earnings were $1.4 billion for the year ended December 31, 2024, an increase of $275.4 million, compared to $1.1 billion for the year ended December 31, 2023.
There can be no assurance that any of our funds or composites or our other existing and future funds or composites will achieve similar returns.
An investment in Blackstone is not an investment in any of our funds or composites. There can be no assurance that any of our funds or composites or our other existing and future funds or composites will achieve similar returns.
SMA Separately managed account. * Represents funds that are currently in their investment period. (a) Excludes investment vehicles where Blackstone does not earn fees. (b) Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital and may include leverage, less invested capital. This amount is not reduced by outstanding commitments to investments.
SMA Separately managed account. * Represents funds that are in their investment period as of December 31, 2024. (a) Excludes investment vehicles where Blackstone does not earn fees. (b) Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital and may include leverage, less invested capital.
There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns. 121 Table of Contents The following table presents the internal rates of return of our significant private equity funds: Year Ended December 31, December 31, 2023 Inception to Date 2023 2022 2021 Realized Total Fund (a) Gross Net Gross Net Gross Net Gross Net Gross Net BCP VI 7% 6% 12% 11% 19% 16% 19% 14% 17% 12% BCP VII 13% 10% -12% -11% 44% 36% 38% 29% 19% 13% BCP VIII 12% 6% 4% — n/a n/a n/m n/m 21% 11% BEP I -15% -13% 57% 46% 78% 59% 18% 14% 15% 11% BEP II 12% 8% 36% 33% 56% 53% 14% 11% 12% 8% BEP III 28% 20% 42% 31% 86% 56% 77% 55% 52% 34% BCP Asia I 16% 13% -38% -35% 193% 158% 128% 96% 40% 28% BCP Asia II 62% 23% n/m n/m n/a n/a n/a n/a 67% 22% BCEP I (b) 2% 2% — — 55% 50% 62% 57% 21% 18% BCEP II (b) 31% 24% 14% 9% n/a n/a n/a n/a 22% 16% Tactical Opportunities 9% 5% -2% -4% 37% 28% 19% 15% 15% 11% Tactical Opportunities Co-Investment and Other 7% 7% — 4% 67% 57% 20% 19% 19% 16% BXG I -2% -5% -13% -13% 50% 29% n/m n/m 2% -2% Strategic Partners VI (c) -2% -3% -10% -11% 53% 49% n/a n/a 18% 14% Strategic Partners VII (c) 1% — -4% -5% 68% 61% n/a n/a 22% 17% Strategic Partners Real Assets II (c) 19% 16% 13% 12% 26% 22% n/a n/a 20% 16% Strategic Partners VIII (c) -1% -3% 3% 2% 144% 128% n/a n/a 37% 29% Strategic Partners Real Estate, SMA and Other (c) -6% -7% 35% 32% 30% 20% n/a n/a 15% 14% Strategic Partners Infrastructure III (c) 15% 11% 58% 45% 134% 85% n/a n/a 48% 32% Strategic Partners IX (c) 15% 7% n/m n/m n/a n/a n/a n/a 32% 18% Strategic Partners GP Solutions (c) -16% -11% 39% 29% n/m n/m n/a n/a 2% -3% BIP 13% 10% 26% 20% 41% 33% n/a n/a 20% 15% Clarus IV -3% -4% 4% 2% 34% 26% 6% -4% 15% 9% BXLS V 43% 27% 10% 2% 13% -4% n/m n/m 26% 13% The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone. n/m Not meaningful generally due to the limited time since initial investment. n/a Not applicable.
There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns. 120 Table of Contents The following table presents the internal rates of return of our significant private equity funds: Year Ended December 31, December 31, 2024 Inception to Date 2024 2023 2022 Realized Total Fund (a) Gross Net Gross Net Gross Net Gross Net Gross Net BCP VI 7% 6% 7% 6% 12% 11% 19% 14% 17% 12% BCP VII 13% 10% 13% 10% -12% -11% 34% 25% 18% 13% BCP VIII 14% 9% 12% 6% 4% — n/m n/m 19% 11% BEP II 40% 23% 12% 8% 36% 33% 15% 12% 14% 9% BEP III 20% 15% 28% 20% 42% 31% 63% 45% 42% 28% BCP Asia I 14% 12% 16% 13% -38% -35% 66% 46% 36% 25% BCP Asia II 91% 76% 62% 23% n/m n/m n/m n/m 80% 51% BCEP I 10% 8% 2% 2% — — 64% 59% 19% 17% BCEP II 14% 10% 31% 24% 14% 9% n/a n/a 19% 14% Tactical Opportunities 13% 9% 9% 5% -2% -4% 18% 15% 15% 10% Tactical Opportunities Co-Investment and Other 13% 11% 7% 7% — 4% 21% 19% 19% 16% BXG I 2% -2% -2% -5% -13% -13% n/m n/m 2% -2% Strategic Partners VI (b) 2% — -2% -3% -10% -11% n/a n/a 18% 13% Strategic Partners VII (b) -1% -2% 1% — -4% -5% n/a n/a 20% 16% Strategic Partners Real Assets II (b) 13% 11% 19% 16% 13% 12% n/a n/a 19% 15% Strategic Partners VIII (b) 1% — -1% -3% 3% 2% n/a n/a 30% 23% Strategic Partners Real Estate, SMA and Other (b) -1% -6% -6% -7% 35% 32% n/a n/a 14% 12% Strategic Partners Infrastructure III (b) 13% 10% 15% 11% 58% 45% n/a n/a 30% 20% Strategic Partners IX (b) 25% 19% 15% 7% n/m n/m n/a n/a 28% 18% Strategic Partners GP Solutions (b) — -3% -16% -11% 39% 29% n/a n/a 1% -3% BSCH (c) 35% 25% 8% 5% 4% 1% n/a n/a 21% 13% BIP (d) 24% 20% 13% 10% 26% 20% n/a n/a 21% 17% Clarus IV 22% 17% -3% -4% 4% 2% 11% 6% 16% 10% BXLS V 42% 31% 43% 27% 10% 2% n/m n/m 31% 19% BXPE (e) n/a 13% n/a n/a n/a n/a n/a n/a n/a 13% BXPE - Class I (f) n/a 14% n/a n/a n/a n/a n/a n/a n/a 14% The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone. n/m Not meaningful generally due to the limited time since initial investment. n/a Not applicable.
There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.
An investment in Blackstone is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.
There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.
An investment in Blackstone is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.
We believe Invested Performance Eligible Assets Under Management is useful to stockholders as it provides insight into the capital deployed that has the potential to generate performance revenues.
We believe Invested Performance Eligible Assets Under Management is useful to stockholders as it provides insight into the capital deployed that has the potential to generate performance revenues. Consolidated Results of Operations Following is a discussion of our consolidated results of operations.
Operating Metrics The following table presents information regarding our Invested Performance Eligible Assets Under Management: Invested Performance Eligible Assets Under Management Estimated % Above High Water Mark/Hurdle (a) December 31, December 31, 2023 2022 2021 2023 2022 2021 (Dollars in Thousands) Credit & Insurance (b) $ 89,508,377 $ 87,175,669 $ 66,350,185 97 % 93 % 94 % (a) Estimated % Above High Water Mark/Hurdle represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Credit & Insurance managed fund has positive investment performance relative to a hurdle, where applicable.
Operating Metrics The following table presents information regarding our Invested Performance Eligible Assets Under Management: Invested Performance Eligible Assets Under Management Estimated % Above High Water Mark/Hurdle (a) December 31, December 31, 2024 2023 2022 2024 2023 2022 (Dollars in Thousands) Credit & Insurance (b) $ 110,519,827 $ 89,500,575 $ 87,166,271 99 % 97 % 93 % (a) Estimated % Above High Water Mark/Hurdle represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Credit & Insurance managed fund has positive investment performance relative to a hurdle, where applicable.
Our carry funds are commitment-based drawdown structured funds that do not permit investors to redeem their interests at their election.
Commitment-based drawdown structured funds generally do not permit investors to redeem their interests at their election.
Net Income Attributable to Non-Controlling Interests in Blackstone Holdings is derived from the Income Before Provision (Benefit) for Taxes at the Blackstone Holdings level, excluding the Net Gains (Losses) from Fund Investment Activities and the percentage allocation of the income between Blackstone personnel and others who are limited partners of Blackstone Holdings and Blackstone after considering any contractual arrangements that govern the allocation of income such as fees allocable to Blackstone. 96 Table of Contents For the years ended December 31, 2023 and 2022, the Net Income Before Taxes allocated to Blackstone personnel and others who are limited partners of Blackstone Holdings was 39.2% and 39.7%, respectively.
Net Income Attributable to Non-Controlling Interests in Blackstone Holdings is derived from the Income Before Provision for Taxes at the Blackstone Holdings level, excluding the Net Gains (Losses) from Fund Investment Activities and the percentage allocation of the income between Blackstone personnel and others who are limited partners of Blackstone Holdings and Blackstone after considering any contractual arrangements that govern the allocation of income such as fees allocable to Blackstone.
Dividends are declared and paid in the quarter subsequent to the quarter in which they are earned. 142 Table of Contents With respect to fiscal year 2023, we paid to stockholders of our common stock a dividend of $0.82, $0.79, $0.80 and $0.94 per share in respect of the first, second, third and fourth quarters, respectively, aggregating to $3.35 per share of common stock.
Dividends are declared and paid in the quarter subsequent to the quarter in which they are earned. 141 Table of Contents With respect to fiscal year 2024, we paid to stockholders of our common stock a dividend of $0.83, $0.82, $0.86 and $1.44 per share in respect of the first, second, third and fourth quarters, respectively, aggregating to $3.95 per share of common stock.
The increase in Net Realizations was attributable to increases of $170.3 million in Realized Performance Revenues, partially offset by an increase of $76.6 million in Realized Performance Compensation and a decrease of $59.1 million in Realized Principal Investment Income.
The decrease in Net Realizations was attributable to an increase of $49.3 million in Realized Performance Compensation and a decrease of $23.9 million in Realized Principal Investment Income, partially offset by an increase of $48.6 million in Realized Performance Revenues.
Financial Statements and Supplementary Data”) differs to reflect the net present value of the payments due to certain non-controlling interest holders.
“Related Party Transactions” (see “ — Item 8. Financial Statements and Supplementary Data”) differs to reflect the net present value of the payments due to certain non-controlling interest holders.
Management Fees, Net were $1.4 billion for the year ended December 31, 2023, an increase of $116.2 million, compared to $1.3 billion for the year ended December 31, 2022, primarily driven by an increase in Base Management Fees. Base Management Fees increased $104.7 million primarily due to inflows from Fee-Earning Assets Under Management in direct lending.
Management Fees, Net were $1.6 billion for the year ended December 31, 2024, an increase of $243.8 million, compared to $1.3 billion for the year ended December 31, 2023, primarily driven by an increase in Base Management Fees. Base Management Fees increased $264.2 million primarily due to an increase in Fee-Earning Assets Under Management in direct lending.
Business — Fee Structure/Incentive Arrangements.” The following discussion is intended to provide supplemental information about how the application of revenue recognition principles impact our financial results, and management’s process for implementing those principles including areas of significant judgment.
The following discussion is intended to provide supplemental information about how the application of fair value principles impact our financial results, and management’s process for implementing those principles including areas of significant judgment.
BCRED net asset value as of December 31, 2023 was $28.5 billion. (u) Represents the Total Net Return for BCRED’s Class I shares, its largest share class. Performance varies by share class. Class I Total Net Return assumes reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BCRED.
(x) Represents the Total Net Return for BCRED’s Class I shares, its largest share class. Performance varies by share class. Class I Total Net Return assumes reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BCRED.
The BPS Composite is not an investible product and, as such, the performance of the BPS Composite does not represent the performance of an actual fund or account. The historical return is from January 1, 2000.
The Absolute Return Composite is not an investible product and, as such, the performance of the Absolute Return Composite does not represent the performance of an actual fund or account.
Year Ended December 31, 2023 2022 2021 (Dollars in Thousands) GAAP Unrealized Principal Investment Income (Loss) $ (603,154 ) $ (1,563,849 ) $ 1,456,201 Segment Adjustment 9,853 328,320 (776,434 ) Unrealized Principal Investment Income (Loss) $ (593,301 ) $ (1,235,529 ) $ 679,767 (g) This adjustment removes Other Revenues on a segment basis.
Year Ended December 31, 2024 2023 2022 (Dollars in Thousands) GAAP Unrealized Principal Investment Income (Loss) $ 380,591 $ (603,154 ) $ (1,563,849 ) Segment Adjustment (108,723 ) 9,853 328,320 Unrealized Principal Investment Income (Loss) $ 271,868 $ (593,301 ) $ (1,235,529 ) (g) This adjustment removes Other Revenues on a segment basis.
Year Ended December 31, 2023 2022 2021 (Dollars in Thousands) Taxes $ 580,925 $ 693,443 $ 703,075 Related Payables 89,585 98,425 56,607 Taxes and Related Payables $ 670,510 $ 791,868 $ 759,682 (k) This adjustment removes Interest and Dividend Revenue less Interest Expense on a segment basis.
Year Ended December 31, 2024 2023 2022 (Dollars in Thousands) Taxes $ 604,508 $ 580,925 $ 693,443 Related Payables 105,689 89,585 98,425 Taxes and Related Payables $ 710,197 $ 670,510 $ 791,868 (k) This adjustment removes Interest and Dividend Revenue less Interest Expense on a segment basis.
Strategic Partners funds within the Private Equity segment have various funds with closed investment periods, including but not limited to: Strategic Partners Real Assets II, Strategic Partners VIII and Strategic Partners Real Estate VII, which are above their respective carried interest thresholds based on aggregate fund position.
Secondaries funds have various funds with closed investment periods, including but not limited to: Strategic Partners Infrastructure III, Strategic Partners VIII, Strategic Partners Real Estate VII and BSCH I which are above their respective carried interest thresholds based on aggregate fund position.
In addition to the cash we receive from our notes offerings and availability under our revolving credit facility, we expect to receive (a) cash generated from operating activities, (b) Performance Revenue realizations, and (c) realizations on the fund investments that we make.
In February 2025, we drew $900.0 million under the Revolving Credit Facility. 133 Table of Contents In addition to the cash we receive from our notes offerings and availability under the Revolving Credit Facility and other borrowings, we expect to receive (a) cash generated from operating activities, (b) Performance Revenue realizations, and (c) realizations on the fund investments that we make.
The amounts of the aggregate applicable general partner original and remaining commitment are shown in the table above.
The amounts of the aggregate applicable general partner original and remaining commitment are shown in the table above. Remaining commitment may exceed original commitment due to recallable capital.
The table above includes operating leases that are recognized as Operating Lease Liabilities, short-term leases that are not recorded as Operating Lease Liabilities and leases that have been signed but not yet commenced which are not recorded as Operating Lease Liabilities. The amounts in this table are presented net of contractual sublease commitments.
The table above includes operating leases that are recognized as Operating Lease Liabilities, short-term leases that are not recorded as Operating Lease Liabilities and leases that have been signed but not yet commenced which are not recorded as Operating Lease Liabilities.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Interest rate changes may therefore affect the amount of our interest payments, future earnings and cash flows. As of December 31, 2023, Blackstone had $39.9 million outstanding under the Secured Borrowings that is subject to interest at a variable rate.
Interest rate changes may therefore affect the amount of our interest payments, future earnings and cash flows. As of December 31, 2024 and 2023, Blackstone had $39.9 million outstanding under the Secured Borrowings that is subject to interest at a variable rate.
We estimate that as of December 31, 2023 and December 31, 2022, a 10% decline in the rate of exchange of all foreign currencies against the U.S. dollar would result in the following declines in Management and Advisory Fees, Net, Unrealized Performance Allocations, Net and Unrealized Principal Investment Income: December 31, 2023 2022 Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b)(c) Unrealized Principal Investment Income (b) Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b)(c) Unrealized Principal Investment Income (b) (Dollars in Thousands) 10% Decline in the Rate of Exchange of All Foreign Currencies Against the U.S.
We estimate that as of December 31, 2024 and December 31, 2023, a 10% decline in the rate of exchange of all foreign currencies against the U.S. dollar would result in the following declines in Management and Advisory Fees, Net, Unrealized Performance Allocations, Net and Unrealized Principal Investment Income: December 31, 2024 2023 Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b)(c) Unrealized Principal Investment Income (b) Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b)(c) Unrealized Principal Investment Income (b) (Dollars in Thousands) 10% Decline in the Rate of Exchange of All Foreign Currencies Against the U.S.
We do not expect any counterparty to default on its obligations and therefore do not expect to incur any loss due to counterparty default. 152 Table of Contents
We do not expect any counterparty to default on its obligations and therefore do not expect to incur any loss due to counterparty default. 151 Table of Contents
We estimate that as of December 31, 2023 and December 31, 2022, a one percentage point increase parallel shift in global yield curves would result in the following impact on Other Revenue: December 31, 2023 2022 (Dollars in Thousands) Annualized Increase (Decrease) in Other Revenue Due to a One Percentage Point Increase in Interest Rates $ 1,352 $ (4,373 ) Credit Risk Certain Blackstone Funds and the Investee Funds are subject to certain inherent risks through their investments.
We estimate that as of December 31, 2024 and December 31, 2023, a one percentage point increase parallel shift in global yield curves would result in the following impact on Other Revenue: December 31, 2024 2023 (Dollars in Thousands) Annualized Increase (Decrease) in Other Revenue Due to a One Percentage Point Increase in Interest Rates $ 2,388 $ 1,352 Credit Risk Certain Blackstone Funds and the Investee Funds are subject to certain inherent risks through their investments.
For the years ended December 31, 2023 and December 31, 2022, the percentages of our fund management fees based on the NAV or GAV of the applicable funds or separately managed accounts, were as follows: Year Ended December 31, 2023 2022 Fund Management Fees Based on the NAV or GAV of the Applicable Funds or Separately Managed Accounts 47 % 49 % 149 Table of Contents Market Risk The Blackstone Funds hold investments which are reported at fair value and Blackstone invests directly in securities measured at fair value.
For the years ended December 31, 2024 and December 31, 2023, the percentages of our fund management fees based on the NAV or GAV of the applicable funds or separately managed accounts, were as follows: Year Ended December 31, 2024 2023 Fund Management Fees Based on the NAV or GAV of the Applicable Funds or Separately Managed Accounts 47 % 47 % Market Risk The Blackstone Funds hold investments which are reported at fair value and Blackstone invests directly in securities measured at fair value.
Based on the fair value as of December 31, 2023 and December 31, 2022, we estimate that a 10% decline in the fair value of investments, excluding equity securities without a readily determinable fair value measured in accordance with the measurement alternative, and certain freestanding derivative instruments would result in the following declines in Management and Advisory Fees, Net, Unrealized Performance Allocations, Net and Unrealized Principal Investment Income: December 31, 2023 2022 Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b) Unrealized Principal Investment Income (c) Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b) Unrealized Principal Investment Income (c) (Dollars in Thousands) 10% Decline in Fair Value of the Investments $ 392,340 $ 2,172,376 $ 835,037 $ 319,183 $ 2,249,535 $ 549,836 (a) Represents the annualized effect of the 10% decline.
Based on the fair value as of December 31, 2024 and December 31, 2023, we estimate that a 10% decline in the fair value of investments, excluding equity securities without a readily determinable fair value measured in accordance with the measurement alternative, and certain freestanding derivative instruments would result in the following declines in Management and Advisory Fees, Net, Unrealized Performance Allocations, Net and Unrealized Principal Investment Income: 148 Table of Contents December 31, 2024 2023 Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b) Unrealized Principal Investment Income (c) Management and Advisory Fees, Net (a) Unrealized Performance Allocations, Net (b) Unrealized Principal Investment Income (c) (Dollars in Thousands) 10% Decline in Fair Value of the Investments $ 424,575 $ 2,399,495 $ 802,964 $ 392,340 $ 2,172,376 $ 835,037 (a) Represents the annualized effect of the 10% decline.
Dollar $ 40,373 $ 596,201 $ 74,707 $ 38,466 $ 850,109 $ 79,333 (a) Represents the annualized effect of the 10% decline. (b) Represents the reporting date effect of the 10% decline. (c) Presented net of Unrealized Performance Allocations Compensation. 150 Table of Contents Interest Rate Risk Blackstone may have debt obligations payable that accrue interest at variable rates.
Dollar $ 52,416 $ 683,852 $ 82,194 $ 40,373 $ 596,201 $ 74,707 (a) Represents the annualized effect of the 10% decline. (b) Represents the reporting date effect of the 10% decline. (c) Presented net of Unrealized Performance Allocations Compensation. 149 Table of Contents Interest Rate Risk Blackstone may have debt obligations payable that accrue interest at variable rates.
Blackstone has a diversified portfolio of liquid assets to meet the liquidity needs of various businesses. This portfolio includes cash, open-ended money market mutual funds, open-ended bond mutual funds, marketable investment securities, freestanding derivative contracts, repurchase and reverse repurchase agreements and other investments.
This portfolio includes cash, open-ended money market mutual funds, open-ended bond mutual funds, marketable investment securities, freestanding derivative contracts, repurchase and reverse repurchase agreements and other investments.
We estimate that our annualized investment income would decrease, if credit spreads were to increase by one percentage point, as follows: December 31, 2023 2022 (Dollars in Thousands) Decrease in Annualized Investment Income Due to a One Percentage Point Increase in Credit Spreads (a) $ 5,343 $ 12,605 (a) As of December 31, 2023 and 2022, this represents 0.1% and 0.3% of our portfolio of liquid assets, respectively.
These exposures are actively monitored on a continuous basis and positions are reallocated based on changes in risk profile, market or economic conditions. 150 Table of Contents We estimate that our annualized investment income would decrease, if credit spreads were to increase by one percentage point, as follows: December 31, 2024 2023 (Dollars in Thousands) Decrease in Annualized Investment Income Due to a One Percentage Point Increase in Credit Spreads (a) $ 1,524 $ 5,343 (a) As of December 31, 2024 and 2023, this represents less than 0.1% and 0.1% of our portfolio of liquid assets, respectively.
If interest rates were to increase by one percentage point, we estimate that our annualized investment income would decrease, offset by an estimated increase in interest income on an annual basis from interest on floating rate assets, as follows: December 31, 2023 2022 Annualized Decrease in Investment Income Annualized Increase in Interest Income from Floating Rate Assets Annualized Decrease in Investment Income Annualized Increase in Interest Income from Floating Rate Assets (Dollars in Thousands) One Percentage Point Increase in Interest Rates $ 6,504 (a) $ 12,881 $ 9,295 (a) $ 28,676 (a) As of December 31, 2023 and 2022, this represents 0.1% and 0.2% of our portfolio of liquid assets, respectively. 151 Table of Contents Blackstone has U.S. dollar and non-U.S. dollar based interest rate derivatives whose future cash flows and present value may be affected by movement in their respective underlying yield curves.
If interest rates were to increase by one percentage point, we estimate that our annualized investment income would decrease, offset by an estimated increase in interest income on an annual basis from interest on floating rate assets, as follows: December 31, 2024 2023 Annualized Decrease in Investment Income Annualized Increase in Interest Income from Floating Rate Assets Annualized Decrease in Investment Income Annualized Increase in Interest Income from Floating Rate Assets (Dollars in Thousands) One Percentage Point Increase in Interest Rates $ 4,042 (a) $ 4,807 $ 6,504 (a) $ 12,881 (a) As of December 31, 2024 and 2023, this represents 0.1% of our portfolio of liquid assets.
Our portfolio of liquid assets contains certain credit risks including, but not limited to, exposure to uninsured deposits with financial institutions, unsecured corporate bonds and mortgage-backed securities. These exposures are actively monitored on a continuous basis and positions are reallocated based on changes in risk profile, market or economic conditions.
Our portfolio of liquid assets contains certain credit risks including, but not limited to, exposure to uninsured deposits with financial institutions, unsecured corporate bonds and mortgage-backed securities.
Management fees will only be directly affected by short-term changes in market conditions to the extent they are based on NAV, GAV or represent permanent impairments of value. These management fees will be increased (or reduced) in direct proportion to the effect of changes in the fair value of our investments in the related funds.
These management fees will be increased (or reduced) in direct proportion to the effect of changes in the fair value of our investments in the related funds.
The annualized increase in interest expense due to a 1% increase in interest rates would be $0.4 million as a result of these borrowings. Blackstone did not have variable interest based debt obligations payable as of December 31, 2022 and therefore, interest expense was not impacted by changes in interest rates for the year ended December 31, 2022.
The annualized increase in interest expense due to a 1% increase in interest rates would be $0.4 million as a result of these borrowings for the year ended December 31, 2024 and 2023. Blackstone has a diversified portfolio of liquid assets to meet the liquidity needs of various businesses.
Removed
Business — Investment Process and Risk Management.” Effect on Fund Management Fees Our management fees are based on (a) third parties’ capital commitments to a Blackstone Fund, (b) third parties’ capital invested in a Blackstone Fund or (c) the net asset value (“NAV”) or gross asset value (“GAV”) of a Blackstone Fund, vehicle or separately managed account, as described in our Consolidated Financial Statements.
Added
Business — Investment Process and Risk Management.” Effect on Fund Management Fees Blackstone earns base management fees from its customers at a fixed percentage of a calculation base. For a description of our accounting policy on revenue recognition and management fee calculation bases, generally, see Note 2.
Added
“Summary of Significant Accounting Policies — Revenue Recognition” in the “Notes to Consolidated Financial Statements” in “ — Item 8. Financial Statements and Supplementary Data.” Management fees will only be directly affected by short-term changes in market conditions to the extent they are based on NAV, gross asset value (“GAV”), or represent permanent impairments of value.
Added
Blackstone has U.S. dollar and non-U.S. dollar based interest rate derivatives whose future cash flows and present value may be affected by movement in their respective underlying yield curves.

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