Blackstone cautions on lower property returns

Blackstone, the world’s biggest private equity fund, told investors to dial back their expectations for property returns as the "great run" of the past five years becomes harder to replicate. They should "calibrate" their expectations, Chris Heady, Asia Pacific chairman and head of Asian real estate, told a conference in Singapore on Tuesday. "They’re probably going to be lower over the next five years." At the same event, Singapore’s sovereign fund GIC, an investor in world real estate from student housing to logistics, said that elevated prices were constraining its investment as it sold assets that had gained in value. Global investors struggled to find high returns in the wake of the financial crisis amid interest rates languishing near record lows and bouts of elevated volatility in the stock and bond markets. While property offered an alternative, higher real-estate prices in places such as Hong Kong, London and New York dimmed the allure. Blackstone had $102bn of real estate ...