Did Jon Gray just say it's time to buy (some) office? (Yes.)
He also said we're in a broad-based real estate recovery.
From Blackstone's earnings call yesterday...
Goldman analyst: "Can you talk a little bit about your outlook over the next 12 to 18 months in terms of Blackstone being a net buyer or net seller of real estate assets and maybe a little bit on which asset classes, in particular, you expect to be more active in on both sides of that equation?"
Jon Gray:
"We definitely have been a net buyer here the last nine months, and we do think the sentiment is improving. But it's still negative. And people look at the headlines, sort of the wreckage from the past, and that concerns them. And they're waiting to see, 'hey, is it safe to go back in?' We tend to be in the seed-planting mode for that."
"But at the same time, as we look into next year, as the public REITs rally, as debt becomes more available at lower costs, we're seeing more people show up."
"So, we've seen, call it, two to three times the number of buyers showing up to buy things like apartments and logistics. So I think the balance this year has been very heavy towards the investing relative to the harvesting. I think that'll start to balance out. Still probably more investing earlier on as we work through the year. I would then expect to see more realizations."
"In terms of the sectors we like, we continue to be heavily leaning towards areas like logistics, where the global trends long-term, particularly as we get through the supply bubble, we think will look very good. Rental housing, there's a shortage of housing around the globe, particularly in developed markets. Data centers, we've talked bout at length, has been a huge theme for us in real estate. It's really powered a number of our vehicles. And so, I think we will find interesting places to deploy capital, and it's possible in office on a selective basis that you can find some interesting things, particularly higher quality buildings, and even retail around the grocery-anchored space as opposed to the enclosed mall."
"So, I think we're in the middle of a broad-based receiver in real estate. We're trying to capture that as much as possible. U.S., Europe and Asia deploying capital. As we work through the cycle and values recover, you'll see a pick-up in sales, and you can feel that happening now."
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