NEW YORK, Nov 8
Blackstone Inc. is unwinding one of its most high-profile but underperforming real-estate bets, agreeing to sell a $1.8 billion stake in senior housing properties that have struggled under rising costs, occupancy declines, and broader market volatility fueled by the US government shutdown.
According to sources familiar with the transaction, the portfolio includes more than 80 facilities across the Midwest and Sun Belt regions. The assets will be transferred to a consortium of healthcare REITs and institutional investors, marking one of the largest real-estate divestments by Blackstone in recent quarters.
“The environment for senior living remains challenging — high interest rates, wage pressures, and softer demand have reduced returns below expectations,” said one person briefed on the sale, who requested anonymity due to deal confidentiality.
Shutdown ripple effects and market sentiment
The sale coincides with broader unease across the real-estate sector as the US government shutdown weighs on investor confidence and delays in federal housing programs disrupt credit markets. Analysts say the offload signals Blackstone’s focus on rebalancing portfolios toward logistics, data centers, and energy infrastructure, sectors still delivering double-digit yields.
“Blackstone is protecting liquidity and repositioning for the next growth cycle,” said Lisa Grant, senior real-estate analyst at Morningfield Capital. “It’s a strategic retreat, not a fire sale.”
Broader implications
The decision comes as private equity firms globally face renewed scrutiny from investors demanding higher returns amid tighter credit and slower deal exits. Industry insiders note that real-estate performance, especially in senior living and office assets, has lagged the broader rebound seen in tech and infrastructure holdings.
Blackstone declined to comment officially on the sale. The transaction is expected to close in Q1 2026, pending regulatory approvals.
