Blackstone fees for performance drop by a tenth

Michael Bow
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WALL Street investor Blackstone yesterday said performance fees across its business fell by 10 per cent versus a year ago, slowing revenue growth to just one per cent.

The company, led by top buyout figure Steve Schwarzman, saw its flagship private equity business drag on overall revenues, after the division’s revenue fell by more than half over the year.

It recorded $150m (£92.8m) for the three months ending September, down from $327m in the same quarter last year due to a decline in the value of publicly traded investments.

However, the fee dip masked a stronger performance overall for the business, with profits and revenues increasing. Economic net income, a measure of profits, rose three per cent year on year to $640.2m.

Assets under management also remained strong, growing by more than a fifth over the year to a $248bn.

“In the third quarter 2013, Blackstone attracted $12bn of organic capital inflows, and $53bn in total inflows over the past year,” Schwarzman said. “We are actively deploying this capital, as our global scale and diversification allow us to source investment opportunities around the world, providing the foundation for strong future returns.”

Its hedge fund business, led by Wall Street veteran Tom Hill, grew revenues by ten per cent while its real estate arm saw a 42 per cent rise.