Blackstone is looking at the dislocation in emerging markets as an opportunity. Of more interest to me is Blackstone's opinion on Europe:
While Europe’s economic crisis has eased, the shrinkage of loans and other assets that regulators are pressing banks to undertake will “be taking some oxygen” out of the region’s economies. Blackstone is forecasting “very slow growth,” (Jonathan) Gray said. (Mr. Gray is Blackstone's global head of real estate.)Blackstone also sees "great strength" in the US housing market as construction still trails pre-recession levels. Finally, Blackstone sees "good signs" in the US lodging market. The "good signs" is somewhat substantiated by this Calculated Risk blog post that Las Vegas Convention traffic is 18% below pre-recession levels, telling me that one important demand component is still recovering.
For real estate investors, Gray expects forced sales by European banks to continue for several more years, fostering opportunity. Blackstone is seeking distressed warehouses, hotels and office buildings throughout the region, he said.
“When people are forced to sell, the pricing tends to be better,” he said. “In Europe, it’s not a growth story. It’s a distress story.”
Of course the global head of real estate, responsible for an $80 billion portfolio, is going to be optimistic, but it's still interesting to read where one of the largest real estate investors in the world sees opportunities.