Real Estate Investments Drive Large Part of Blackstone and KKR Value

Blackstone Inc has 315.4 billion USD in real estate assets under management, while KKR & Co Inc manages 163 billion USDs in real estate assets.

Since Blackstone and KKR have the same vein of private equity and private credit investments both in terms of share of assets and structure like Apollo, Carlyle and Ares, but have much higher market capitalization than Apollo, Carlyle and Ares, large part of the value accrued to Blackstone and KKR is largely from their real estate investments and also to a smaller extent from proprietary investments, according to Wolfteam Ltd.'s projections and estimates.

Blackstone and KKR are undervalued, still have much more unlocked value, in Wolfteam Ltd.'s view. 

Blackstone's 2024 earnings statement:

$ in thousands, except per share data) (unaudited) 4Q'23 4Q'24 FY'23 FY'24
Revenues
Management and Advisory Fees, Net 1,648,132$ 1,879,581$ 6,671,260$ 7,188,936$
Incentive Fees 240,417 404,744 695,171 964,178
Performance Allocations (362,474) 507,150 532,173 3,829,153
Principal Investments (298,549) 36,989 (299,331) 712,849
Interest and Dividend Revenue 168,374 98,547 516,497 411,159
Other (110,880) 155,554 (92,929) 123,693
Total Revenues 1,285,020$ 3,082,565$ 8,022,841$ 13,229,968$
Expenses
Compensation and Benefits 543,078 1,039,203 3,312,970 4,994,053
General, Administrative and Other 289,691 339,086 1,117,305 1,361,909
Interest Expense 108,732 115,532 431,868 443,688
Fund Expenses 69 6,296 118,987 19,676
Total Expenses 941,570$ 1,500,117$ 4,981,130$ 6,819,326$
Other Income (Loss) (188,370)$ (21,171)$ (83,997)$ 48,838$
Income Before Provision for Taxes 155,080$ 1,561,277$ 2,957,714$ 6,459,480$
Provision for Taxes 45,957 232,451 513,461 1,021,671
Net Income 109,123$ 1,328,826$ 2,444,253$ 5,437,809$
Redeemable NCI in Consolidated Entities (163,929) 306 (245,518) (61,289)
Non-Redeemable NCI in Consolidated Entities 121,252 624,647 1,298,891 2,722,590
Net Income Attributable to Blackstone Inc. (''BX'') 151,800$ 703,873$ 1,390,880$ 2,776,508$
Net Income Per Share of Common Stock, Basic 0.20$ 0.92$ 1.84$ 3.62$
Net Income Per Share of Common Stock, Diluted 0.20$ 0.92$ 1.84$ 3.62

 

KKR's 2024 earnings statement: 

$ in thousands, except per share data) 3Q'23 3Q'24 3Q'23 YTD 3Q'24 YTD
Revenues
Asset Management and Strategic Holdings $ 1,665,012 $ 2,269,090 $ 4,242,390 $ 5,786,007
Insurance 1,650,469 2,522,606 5,827,091 12,834,337
Total Revenues $ 3,315,481 $ 4,791,696 $ 10,069,481 $ 18,620,344
Expenses
Asset Management and Strategic Holdings $ 1,168,348 $ 1,778,343 $ 2,950,149 $ 4,619,272
Insurance 1,147,175 2,898,662 5,347,939 13,317,006
Total Expenses $ 2,315,523 $ 4,677,005 $ 8,298,088 $ 17,936,278
Total Investment Income (Loss) - Asset Management and Strategic Holdings $ 1,819,232 $ 1,598,873 $ 2,907,245 $ 3,602,754
Income Tax Expense (Benefit) 437,210 224,896 910,912 711,066
Redeemable Noncontrolling Interests (3,685) (4,798) (12,728) 57,546
Noncontrolling Interests 895,539 838,916 1,088,622 1,513,518
Preferred Stock Dividends 17,248 — 51,747 —
Net Income (Loss) - KKR Common Stockholders $ 1,472,878 $ 654,550 $ 2,640,085 $ 2,004,690
Net Income (Loss) Attributable to KKR & Co. Inc. Per Share of Common Stock
Basic $ 1.71 $ 0.74 $ 3.06 $ 2.26
Diluted $ 1.64 $ 0.69 $ 2.95 $ 2.15
Weighted Average Shares of Common Stock Outstanding
Basic 862,123,088 887,444,991 861,598,674 886,618,138
Diluted 909,056,980 941,967,479 911,716,705 933,079,377