BREIT Impairments Jump to $496.7 Million as Inflows Top Repurchases

Blackstone Real Estate Income Trust Inc., the nontraded real estate investment trust commonly known as BREIT, reported $496.7 million in real estate impairment charges for the third quarter, up from $27.4 million a year earlier, in results filed Nov. 6. The charges came in a quarter when capital raising outpaced repurchases and BREIT fulfilled all repurchase requests it received.

Of the third-quarter total, $453.7 million related to 13 rental housing properties, one office property, and various single-family rental homes, after BREIT updated its undiscounted cash flow assumptions. The remaining $43 million covered held-for-sale properties whose carrying value exceeded their fair value less estimated closing costs. BREIT did not identify the properties or their markets.

Impairments for the first nine months totaled $731.1 million, compared with $368.8 million a year earlier. BREIT said the nine-month cash flow updates were primarily to account for a shorter hold period. The third-quarter charge was more than three times the $135.2 million BREIT recorded in the first quarter.

Impairments are a charge under generally accepted accounting principles against a property’s depreciated cost. They do not flow directly into BREIT’s net asset value, which is based on the fair value of its holdings and sets the price at which shares are bought and repurchased.

BREIT sold 65 rental housing properties, nine industrial properties, and one office property in the quarter for $2 billion in net proceeds, recognizing a net gain of $366.1 million. BREIT said the gains were offset by the quarter’s impairments. The rental housing sales included BREIT’s remaining 40 manufactured housing properties, which generated $921 million in net proceeds and a $172.3 million gain.

The sales follow a run of non-core dispositions that BREIT has said total about $7 billion this year. Total assets fell to $88.9 billion as of Sept. 30, from $98.6 billion at year-end 2025, and quarterly revenue declined to $1.79 billion from $1.94 billion a year earlier.

Net loss attributable to stockholders narrowed to $160.9 million, from $638.7 million in the third quarter of 2025. Income from unconsolidated entities swung to a $475.6 million gain from a $149.8 million loss, and interest rate derivatives produced a $119.5 million gain after a $159.3 million loss a year earlier.

Flows and Repurchases

BREIT raised $1.1 billion from the sale of common stock and operating partnership units in the third quarter, plus $0.2 billion through its Delaware statutory trust program, and repurchased $0.8 billion of shares and units, the company said.

Monthly repurchases declined through the quarter, from 21.1 million shares in July to 19.4 million in August and 15.6 million in September. Third-quarter repurchases equaled 1.6% of NAV,  below the 5% quarterly limit under BREIT’s share repurchase plan. BREIT said it fulfilled $2.9 billion of repurchase requests in the first nine months, representing all third-party requests received.

On a year-over-year basis, proceeds from new share sales rose 65% to $808.6 million from $491.1 million, while share repurchases fell 37% to $819.5 million from $1.31 billion. Those figures exclude distribution reinvestment and operating partnership units.

NAV and Returns

BREIT reported a Class I NAV per share of $14.65 as of Sept. 30, up from $14.25 at March 31 and $14.13 at year-end 2025. Aggregate NAV was $57.7 billion. Class I shares returned 7.3% year to date and 9.3% annualized since inception, without upfront selling commissions, according to the company. The Class I average annualized distribution rate for the quarter was 4.6%, according to BREIT.

The performance participation allocation paid to Blackstone’s special limited partner totaled $562.8 million for the first nine months, up from $355 million a year earlier. BREIT attributed the increase to a higher total return.

Blackstone held BREIT shares and operating partnership units valued at $5.8 billion as of Sept. 30. During the quarter, BREIT’s adviser, Blackstone affiliate BX REIT Advisors L.L.C., submitted 2.4 million Class B operating partnership units it had received as management fees for repurchase, and BREIT bought them back for $35.0 million. Those redemptions are not counted under the share repurchase plan or its limits, BREIT said. Blackstone did not submit any other shares or units it received as fee payments for repurchase in the quarter.

Data Center Shift

BREIT invested $3.4 billion, at its share, in data center development through its QTS platform in the quarter. BREIT said those developments are 100% pre-leased, in substantially all cases to investment-grade tenants.

Data centers made up 30% of BREIT’s portfolio by fair value as of Sept. 30, behind rental housing at 39% and ahead of industrial at 20%. Data center revenue for the first nine months rose to $1.24 billion from $670.2 million a year earlier.

BREIT reported a 43% leverage ratio as of Sept. 30 and $8.4 billion in liquidity as of Nov. 5, including $7.2 billion in undrawn credit facilities.

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