Blackstone Real Estate Income Trust shared its financial results for the first quarter of 2025. The company declared and fully covered approximately $598.6 million in total distributions during the quarter, as compared to approximately $649.5 million in total distributions, year-over-year. Of those Q1 2025 distributions, 96% or $572.4 million were through cash flows from operating activities.
BREIT, the publicly registered non-traded real estate investment trust sponsored by private equity giant The Blackstone Group (NYSE:BX), reported “a strong start in 2025 amidst tremendous volatility and declines in the public markets. Healthy cash flow growth powered a net return of 1.9% for Class I shares in the first quarter.” This represented BREIT’s best quarter since Q3 2023.
Since inception over eight years ago, BREIT has generated a 9.4% annualized net return for Class I shares, about 65% higher than publicly traded REITs, according to the company, and three times that of private real estate. In 2024, 96% of BREIT’s distribution was classified as return of capital, bringing its 4.8% pre-tax Class I distribution rate to 7.5% on a tax-equivalent basis.
As of March 31, 2025, BREIT’s portfolio was 95% invested in real estate and 5% invested in real estate debt. Reporting no acquisitions in the first quarter of 2025, the company had 4,568 properties and 62,428 single-family rental homes as of quarter’s end, with a total 94% occupancy rate.
BREIT operates across nine reportable segments, including rental housing, industrial, net lease, data centers, hospitality, self-storage retail, and office properties, and investments in real estate debt.
Same property rental revenue increased $49.2 million for the quarter ending March 2025 compared to the three months ended March 31, 2024. The increase was due to a $39.9 million increase in base rental revenue, a $6.7 million increase in tenant reimbursement income as a result of higher operating expenses, and a $2.6 million decrease in bad debt reserves. According to BREIT, its bad debt reserves represent the amount of rental revenue it anticipates not being able to collect from tenants.
BREIT reported negative funds from operations of $937.8 million, as opposed to positive FFO of $743.6 million in the first quarter of 2024. Adjusted funds from operations decreased approximately 22.9% year over year to $339.7 million.
Preliminary estimates indicate same-property net operating income growth of 4% for the three months ended March 31, 2025, compared to the same period in 2024. However, BREIT reported a net loss of approximately $1.8 billion for the quarter ending March 31, compared to a year-over-year net loss of approximately $170.1 million.
The company’s total net asset value at the end of Q1 2025 was approximately $53.3 billion. This was a 10.1% decrease from the REIT’s total NAV of approximately $59.3 billion as of March 31, 2024.
As of March 31, 2025, and Dec. 31, 2024, the company’s investments in real estate debt, directly or indirectly, consisted of commercial mortgage-backed securities and residential mortgage-backed securities, which are securities backed by one or more mortgage loans secured by real estate assets, as well as corporate bonds, term loans, mezzanine loans, and other investments in debt issued by real estate-related companies or secured by real estate assets.
BREIT is currently offering on a continuous basis up to $60 billion in shares of common stock, consisting of up to $48 billion in shares in its primary offering and up to $12 billion in shares pursuant to its distribution reinvestment plan. As of May 9, it had received cumulative net proceeds of $17.1 billion from selling an aggregate of 1.2 billion shares of its common stock in the current offering, including shares converted from operating partnership units. As of March 31, 2025, it had nearly 3.9 billion outstanding shares.
BREIT’s portfolio is concentrated in sectors with strong secular demand, including rental housing, industrial, and data centers, and is approximately 90% invested in these sectors. Approximately 70% of BREIT’s portfolio is located in fast-growing Sunbelt markets.
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