Blackstone at Morgan Stanley Conference Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

$BX Notes from Morgan Stanley Conference

“we’re the largest owner of real estate in the world.”

“the premium for our type of investing, which I wouldn’t say is riskless but it is much less risk because of our ability to do due diligence than just buying liquid securities where anything could happen to you. If you don’t like it you can sell them. The only difference is we can’t sell ours but we get compensated with much higher returns and much more knowledge of what you’re buying.”

“It is remarkable, I remember, when we just started the firm and almost everybody turned us down for everything. Our first fund, our 17 closest relationships turned us down. I don’t know how much sort of psychic pain you can take in this audience but we’ve been given a lot of psychic pain over our career and so every investor that we have and we’ve got I guess now around 1300…is really a prized relationship”

“When we went into business, what we said is, “The only reason we need to exist is to do things other people aren’t doing and to do what we do as well as you can conceivably do it.” …go into other businesses that would be great on their own but would make the existing mix stronger, and you had to do it with people who were 10s on a scale of 10.”

“If you’re in business with 10s, it’s like — how many of you watch the Sunday night game with the Heat and the Spurs? Wow. Lebron and all these people, that’s a 10. I mean, they crushed them. And that’s what you need to do a great job starting a new business.”

“our percent of wallet for these large institutions is going up steadily and quite rapidly. …they’re trying to lower their costs, which means they’d like to have fewer people working at these places, and so they’re giving more money to their best managers. So we’re caught in this sort of wonderful situation where they’re allocating more money to our asset class.”

“I own 23% of the stock of the firm, so I’m on your team out there if you’re owners of Blackstone. I’m on your team.”

“It’s much easier to invest in real estate than it is in the company. Companies are very complex, very dynamic and what you find about real estate that’s very comforting is first of all, buildings don’t talk, right?”

“Our latest Real Estate fund is up 32% compounded in the last 2 years…And as a result of that, we are getting hugely disproportionate allocations from almost everyone…We’re currently operating at roughly 4x the size of anyone else”

“As an entrepreneurial business, you know when you’re successful because it’s when people really want to join you who have enormous records of success.”