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Tuesday, February 20, 2024

Blackstone’s $4 Billion California Deal Riles College Unions


(Bloomberg) — Unions representing 110,000 College of California employees demanded that the system divest holdings from Blackstone Inc., together with a latest $4 billion funding with its large actual property belief. 

The teams are contending that the connection with the non-public fairness agency will worsen the housing scarcity for college kids and staff, in line with a letter dated Friday. The College of California’s funding workplace struck a deal earlier this month to inject $4 billion into Blackstone Actual Property Revenue Belief. 

“The College of California’s present housing funding technique mixed with the bolstering of Blackstone’s BREIT will solely additional deepen a hostile housing marketplace for tens of millions throughout California,” union leaders stated in a letter to Jagdeep Bachher, chief funding officer for the college system’s $152 billion pension and endowment funds. 

1000’s of the college’s graduate college students and employees went on a monthlong strike final yr, demanding pay will increase due to the excessive price of residing in California, which has cities with among the nation’s costliest housing.  

BREIT’s $4 billion cope with the College of California got here after its large actual property belief for rich people confronted stress amid heightened withdrawal requests. Final yr, Blackstone funds paid $12.8 billion for student-housing landlord American Campus Communities.

A consultant for the College of California confirmed it has obtained the letter and was reviewing it. The consultant additionally reiterated earlier feedback by Bachher that the funding “is a chance that comes solely by means of sturdy, trusted partnership” and gives the college system with a well-diversified actual property portfolio. 

Representatives of Blackstone didn’t instantly reply to a request for remark.

© 2023 Bloomberg L.P.

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