Oppenheimer says Blackstone ‘may trade down before it trades up’ amid BREIT fear

Oppenheimer analyst Christopher Kotowski notes Blackstone shares are down 7.5%, while most of its peers are flattish on the day, which he believes to be caused by an announcement by BREIT, its non-traded retail REIT, that it had received repurchase requests for $1.8B in October and that additional repurchase requests in November drove the total above the 5% NAV quarterly limit, so it is limiting withdrawals. This "is perhaps bad optics and draws criticisms from reporters and politicians," but Blackstone "clearly has the right to do so" as he thinks "the reality is that it would be impossible to give retail customers access to private market assets without some kind of gating mechanism," Kotowski tells investors. While he has been Neutral rated on the stock, and remains so because it has had a very rich multiple compared to peers, "BREIT has nothing to do with that stance," said the analyst, who adds: "The stock may trade down before it trades up as a result of this concern, but two years from now, we doubt anyone will remember this."