Published: 2021-08-06 00:00:00 ET

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☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM              TO

Delaware (State or other jurisdiction of incorporation or organization)		20-8875684 (I.R.S. Employer Identification No.)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		BX		New York Stock Exchange

Large accelerated filer ☒						Accelerated filer ☐
Non-accelerated filer ☐						Smaller reporting company  ☐
						Emerging growth company ☐

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				Page
Part I.		Financial Information
Item 1.		Financial Statements			6
		Unaudited Condensed Consolidated Financial Statements:
		Condensed Consolidated Statements of Financial Condition as of June 30, 2021 and December 31, 2020			6
		Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2021 and 2020			8
		Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2021 and 2020			9
		Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2021 and 2020			10
		Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020			14
		Notes to Condensed Consolidated Financial Statements			16
Item 1A.		Unaudited Supplemental Presentation of Statements of Financial Condition			64
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations			66
Item 3.		Quantitative and Qualitative Disclosures About Market Risk			134
Item 4.		Controls and Procedures			134
Part II.		Other Information
Item 1.		Legal Proceedings			134
Item 1A.		Risk Factors			135
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds			135
Item 3.		Defaults Upon Senior Securities			136
Item 4.		Mine Safety Disclosures			136
Item 5.		Other Information			136
Item 6.		Exhibits			136
Signatures					138

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(a)

the fair value of the investments held by our carry funds and our side-by-side and co-investment entities managed by us plus the capital that we are entitled to call from investors in those funds and entities pursuant to the terms of their respective capital commitments, including capital commitments to funds that have yet to commence their investment periods,

(b)

the net asset value of (1) our hedge funds, real estate debt carry funds, BPP, certain co-investments managed by us, certain credit-focused funds, and our Hedge Fund Solutions drawdown funds (plus, in each case, the capital that we are entitled to call from investors in those funds, including commitments yet to commence their investment periods), and (2) our funds of hedge funds, our Hedge Fund Solutions registered investment companies, and BREIT,

(c)

the invested capital, fair value or net asset value of assets we manage pursuant to separately managed accounts,

(d)

the amount of debt and equity outstanding for our collateralized loan obligations (“CLO”) during the reinvestment period,

(e)

the aggregate par amount of collateral assets, including principal cash, for our CLOs after the reinvestment period,

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(f)

the gross or net amount of assets (including leverage where applicable) for our credit-focused registered investment companies,

(g)

the fair value of common stock, preferred stock, convertible debt, term loans or similar instruments issued by BXMT, and

(h)

borrowings under and any amounts available to be borrowed under certain credit facilities of our funds.

(a)

for our Private Equity segment funds and Real Estate segment carry funds, including certain BREDS and Hedge Fund Solutions funds, the amount of capital commitments, remaining invested capital, fair value, net asset value or par value of assets held, depending on the fee terms of the fund,

(b)

for our credit-focused carry funds, the amount of remaining invested capital (which may include leverage) or net asset value, depending on the fee terms of the fund,

(c)

the remaining invested capital or fair value of assets held in co-investment vehicles managed by us on which we receive fees,

(d)

the net asset value of our funds of hedge funds, hedge funds, BPP, certain co-investments managed by us, certain registered investment companies, BREIT, and certain of our Hedge Fund Solutions drawdown funds,

(e)

the invested capital, fair value of assets or the net asset value we manage pursuant to separately managed accounts,

(f)

the net proceeds received from equity offerings and accumulated distributable earnings of BXMT, subject to certain adjustments,

(g)

the aggregate par amount of collateral assets, including principal cash, of our CLOs, and

(h)

the gross amount of assets (including leverage) or the net assets (plus leverage where applicable) for certain of our credit-focused registered investment companies.

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Item 1.

Financial Statements

		June 30,				December 31,
		2021				2020
Assets
Cash and Cash Equivalents		$	2,467,444			$	1,999,484
Cash Held by Blackstone Funds and Other			109,676				64,972
Investments (including assets pledged of $80,027 and $110,835 at June 30, 2021 and December 31, 2020, respectively)			22,163,322				15,617,142
Accounts Receivable			582,542				866,158
Due from Affiliates			3,159,829				3,221,515
Intangible Assets, Net			321,780				347,955
Goodwill			1,890,202				1,901,485
Other Assets			556,714				481,022
Right-of-Use Assets			723,539				526,943
Deferred Tax Assets			1,322,144				1,242,576
Total Assets		$	33,297,192			$	26,269,252
Liabilities and Equity
Loans Payable		$	5,594,648			$	5,644,653
Due to Affiliates			1,226,504				1,135,041
Accrued Compensation and Benefits			5,789,662				3,433,260
Securities Sold, Not Yet Purchased			35,783				51,033
Repurchase Agreements			57,247				76,808
Operating Lease Liabilities			841,152				620,844
Accounts Payable, Accrued Expenses and Other Liabilities			1,205,182				717,104
Total Liabilities			14,750,178				11,678,743
Commitments and Contingencies
Redeemable Non-Controlling Interests in Consolidated Entities			65,568				65,161
Equity
Stockholders’ Equity of The Blackstone Group Inc.
Common Stock, $0.00001 par value, 90 billion shares authorized, (691,093,463 shares issued and outstanding as of June 30, 2021; 683,875,544 shares issued and outstanding as of December 31, 2020)			7				7
Series I Preferred Stock, $0.00001 par value, 999,999,000 shares authorized, (1 share issued and outstanding as of June 30, 2021 and December 31, 2020)			—				—
Series II Preferred Stock, $0.00001 par value, 1,000 shares authorized, (1 share issued and outstanding as of June 30, 2021 and December 31, 2020)			—				—
Additional Paid-in-Capital			6,282,600				6,332,105
Retained Earnings			2,133,794				335,762
Accumulated Other Comprehensive Loss			(10,245	)			(15,831	)
Total Stockholders’ Equity of The Blackstone Group Inc.			8,406,156				6,652,043
Non-Controlling Interests in Consolidated Entities			4,860,442				4,042,157
Non-Controlling Interests in Blackstone Holdings			5,214,848				3,831,148
Total Equity			18,481,446				14,525,348
Total Liabilities and Equity		$	33,297,192			$	26,269,252

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		June 30,				December 31,
		2021				2020
Assets
Cash Held by Blackstone Funds and Other		$	109,676			$	64,972
Investments			1,871,269				1,455,008
Accounts Receivable			80,374				120,099
Due from Affiliates			11,144				8,676
Other Assets			549				262
Total Assets		$	2,073,012			$	1,649,017
Liabilities
Loans Payable		$	99			$	99
Due to Affiliates			101,879				65,429
Securities Sold, Not Yet Purchased			23,830				41,709
Repurchase Agreements			57,247				76,808
Accounts Payable, Accrued Expenses and Other Liabilities			33,614				37,221
Total Liabilities		$	216,669			$	221,266

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		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Revenues
Management and Advisory Fees, Net		$	1,212,549			$	969,728			$	2,390,364			$	1,904,560
Incentive Fees			33,207				15,300				69,331				27,461
Investment Income (Loss)
Performance Allocations
Realized			808,620				101,910				1,342,987				269,440
Unrealized			2,697,170				1,067,923				5,161,667				(2,385,158	)
Principal Investments
Realized			152,060				61,102				507,098				109,797
Unrealized			328,835				331,762				968,150				(627,603	)
Total Investment Income (Loss)			3,986,685				1,562,697				7,979,902				(2,633,524	)
Interest and Dividend Revenue			31,017				23,924				62,429				59,008
Other			27,896				(55,580	)			88,200				82,600
Total Revenues			5,291,354				2,516,069				10,590,226				(559,895	)
Expenses
Compensation and Benefits
Compensation			507,104				458,457				1,049,742				935,000
Incentive Fee Compensation			14,431				8,432				27,756				14,954
Performance Allocations Compensation
Realized			347,423				38,569				560,450				110,992
Unrealized			1,150,219				454,813				2,200,188				(942,565	)
Total Compensation and Benefits			2,019,177				960,271				3,838,136				118,381
General, Administrative and Other			205,057				169,051				390,179				326,617
Interest Expense			44,322				39,276				89,305				80,920
Fund Expenses			3,774				4,083				6,157				8,688
Total Expenses			2,272,330				1,172,681				4,323,777				534,606
Other Income (Loss)
Change in Tax Receivable Agreement Liability			(392	)			76				2,518				(519	)
Net Gains (Losses) from Fund Investment Activities			127,116				158,297				247,469				(169,077	)
Total Other Income (Loss)			126,724				158,373				249,987				(169,596	)
Income (Loss) Before Provision (Benefit) for Taxes			3,145,748				1,501,761				6,516,436				(1,264,097	)
Provision (Benefit) for Taxes			288,250				147,415				287,803				(11,288	)
Net Income (Loss)			2,857,498				1,354,346				6,228,633				(1,252,809	)
Net Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			637				(3,426	)			1,266				(18,895	)
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			431,516				294,378				818,366				(350,699	)
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			1,116,193				495,128				2,351,977				(384,989	)
Net Income (Loss) Attributable to The Blackstone Group Inc.		$	1,309,152			$	568,266			$	3,057,024			$	(498,226	)
Net Income (Loss) Per Share of Common Stock
Basic		$	1.82			$	0.81			$	4.27			$	(0.74	)
Diluted		$	1.82			$	0.81			$	4.27			$	(0.74	)
Weighted-Average Shares of Common Stock Outstanding
Basic			721,141,954				698,534,168				715,121,029				677,041,769
Diluted			721,265,180				1,204,411,957				715,622,208				677,041,769

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		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Net Income (Loss)		$	2,857,498			$	1,354,346			$	6,228,633			$	(1,252,809	)
Other Comprehensive Income (Loss), Currency Translation Adjustment			2,124				8,316				10,055				(11,903	)
Comprehensive Income (Loss)			2,859,622				1,362,662				6,238,688				(1,264,712	)
Less:
Comprehensive Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			637				(3,426	)			1,266				(18,895	)
Comprehensive Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			431,516				294,378				818,366				(350,699	)
Comprehensive Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			1,117,108				498,669				2,356,446				(388,629	)
Comprehensive Income (Loss) Attributable to Non-Controlling Interests			1,549,261				789,621				3,176,078				(758,223	)
Comprehensive Income (Loss) Attributable to The Blackstone Group Inc.		$	1,310,361			$	573,041			$	3,062,610			$	(506,489	)

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		Shares of The Blackstone Group Inc. (a)				The Blackstone Group Inc. (a)
																		Accumulated																				Redeemable
																		Other								Non-				Non-								Non-
																		Compre-								Controlling				Controlling								Controlling
										Additional				Retained				hensive				Total				Interests in				Interests in								Interests in
		Common				Common				Paid-in-				Earnings				Income				Stockholders’				Consolidated				Blackstone				Total				Consolidated
		Stock				Stock				Capital				(Deficit)				(Loss)				Equity				Entities				Holdings				Equity				Entities
Balance at March 31, 2021			690,569,563			$	7			$	6,446,829			$	1,408,768			$	(11,454	)		$	7,844,150			$	4,390,594			$	4,524,898			$	16,759,642			$	65,546
Net Income			—				—				—				1,309,152				—				1,309,152				431,516				1,116,193				2,856,861				637
Currency Translation Adjustment			—				—				—				—				1,209				1,209				—				915				2,124				—
Capital Contributions			—				—				—				—				—				—				204,933				2,551				207,484				—
Capital Distributions			—				—				—				(584,126	)			—				(584,126	)			(166,518	)			(441,687	)			(1,192,331	)			(615	)
Transfer of Non-Controlling Interests in Consolidated Entities			—				—				—				—				—				—				(83	)			—				(83	)			—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from Non-Controlling Interest Holders			—				—				9,535				—				—				9,535				—				—				9,535				—
Equity-Based Compensation			—				—				77,083				—				—				77,083				—				55,046				132,129				—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock			273,659				—				(4,860	)			—				—				(4,860	)			—				—				(4,860	)			—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units			(3,174,598	)			—				(289,055	)			—				—				(289,055	)			—				—				(289,055	)			—
Change in The Blackstone Group Inc.’s Ownership Interest			—				—				11,322				—				—				11,322				—				(11,322	)			—				—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock			3,424,839				—				31,746				—				—				31,746				—				(31,746	)			—				—
Balance at June 30, 2021			691,093,463			$	7			$	6,282,600			$	2,133,794			$	(10,245	)		$	8,406,156			$	4,860,442			$	5,214,848			$	18,481,446			$	65,568

(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.

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		Shares of The Blackstone Group Inc. (a)				The Blackstone Group Inc. (a)
																		Accumulated																				Redeemable
																		Other								Non-				Non-								Non-
																		Compre-								Controlling				Controlling								Controlling
										Additional				Retained				hensive				Total				Interests in				Interests in								Interests in
		Common				Common				Paid-in-				Earnings				Income				Stockholders’				Consolidated				Blackstone				Total				Consolidated
		Stock				Stock				Capital				(Deficit)				(Loss)				Equity				Entities				Holdings				Equity				Entities
Balance at March 31, 2020			676,630,489			$	7			$	6,298,093			$	(871,948	)		$	(41,533	)		$	5,384,619			$	3,591,160			$	2,530,263			$	11,506,042			$	72,066
Net Income (Loss)			—				—				—				568,266				—				568,266				294,378				495,128				1,357,772				(3,426	)
Currency Translation Adjustment			—				—				—				—				4,775				4,775				—				3,541				8,316				—
Capital Contributions			—				—				—				—				—				—				170,282				—				170,282				—
Capital Distributions			—				—				—				(270,613	)			—				(270,613	)			(155,525	)			(203,354	)			(629,492	)			(76	)
Transfer of Non-Controlling Interests in Consolidated Entities			—				—				—				—				—				—				134				—				134				—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from Non-Controlling Interest Holders			—				—				2,806				—				—				2,806				—				—				2,806				—
Equity-Based Compensation			—				—				73,455				—				—				73,455				—				55,442				128,897				—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock			56,662				—				(2,398	)			—				—				(2,398	)			—				—				(2,398	)			—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units			(2,000,000	)			—				(114,893	)			—				—				(114,893	)			—				—				(114,893	)			—
Change in The Blackstone Group Inc.’s Ownership Interest			—				—				4,006				—				—				4,006				—				(4,006	)			—				—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock			2,187,432				—				10,971				—				—				10,971				—				(10,971	)			—				—
Balance at June 30, 2020			676,874,583			$	7			$	6,272,040			$	(574,295	)		$	(36,758	)		$	5,660,994			$	3,900,429			$	2,866,043			$	12,427,466			$	68,564

(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.

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		Shares of The Blackstone Group Inc. (a)				The Blackstone Group Inc. (a)
																		Accumulated																				Redeemable
																		Other								Non-				Non-								Non-
																		Compre-								Controlling				Controlling								Controlling
										Additional				Retained				hensive				Total				Interests in				Interests in								Interests in
		Common				Common				Paid-in-				Earnings				Income				Stockholders’				Consolidated				Blackstone				Total				Consolidated
		Stock				Stock				Capital				(Deficit)				(Loss)				Equity				Entities				Holdings				Equity				Entities
Balance at December 31, 2020			683,875,544			$	7			$	6,332,105			$	335,762			$	(15,831	)		$	6,652,043			$	4,042,157			$	3,831,148			$	14,525,348			$	65,161
Net Income			—				—				—				3,057,024				—				3,057,024				818,366				2,351,977				6,227,367				1,266
Currency Translation Adjustment			—				—				—				—				5,586				5,586				—				4,469				10,055				—
Capital Contributions			—				—				—				—				—				—				412,230				5,259				417,489				—
Capital Distributions			—				—				—				(1,258,992	)			—				(1,258,992	)			(408,718	)			(1,024,657	)			(2,692,367	)			(859	)
Transfer of Non-Controlling Interests in Consolidated Entities			—				—				—				—				—				—				(3,593	)			—				(3,593	)			—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from Non-Controlling Interest Holders			—				—				19,714				—				—				19,714				—				—				19,714				—
Equity-Based Compensation			—				—				168,606				—				—				168,606				—				120,941				289,547				—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock			1,986,972				—				(23,059	)			—				—				(23,059	)			—				—				(23,059	)			—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units			(3,174,598	)			—				(289,055	)			—				—				(289,055	)			—				—				(289,055	)			—
Change in The Blackstone Group Inc.’s Ownership Interest			—				—				3,877				—				—				3,877				—				(3,877	)			—				—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock			8,405,545				—				70,412				—				—				70,412				—				(70,412	)			—				—
Balance at June 30, 2021			691,093,463			$	7			$	6,282,600			$	2,133,794			$	(10,245	)		$	8,406,156			$	4,860,442			$	5,214,848			$	18,481,446			$	65,568

(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.

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		Shares of The Blackstone Group Inc. (a)				The Blackstone Group Inc. (a)
																		Accumulated																				Redeemable
																		Other								Non-				Non-								Non-
																		Compre-								Controlling				Controlling								Controlling
										Additional				Retained				hensive				Total				Interests in				Interests in								Interests in
		Common				Common				Paid-in-				Earnings				Income				Stockholders’				Consolidated				Blackstone				Total				Consolidated
		Stock				Stock				Capital				(Deficit)				(Loss)				Equity				Entities				Holdings				Equity				Entities
Balance at December 31, 2019			671,157,692			$	7			$	6,428,647			$	609,625			$	(28,495	)		$	7,009,784			$	4,186,069			$	3,819,548			$	15,015,401			$	87,651
Net Income (Loss)			—				—				—				(498,226	)			—				(498,226	)			(350,699	)			(384,989	)			(1,233,914	)			(18,895	)
Currency Translation Adjustment			—				—				—				—				(8,263	)			(8,263	)			—				(3,640	)			(11,903	)			—
Capital Contributions			—				—				—				—				—				—				372,961				—				372,961				—
Capital Distributions			—				—				—				(685,694	)			—				(685,694	)			(305,797	)			(569,055	)			(1,560,546	)			(192	)
Transfer of Non-Controlling Interests in Consolidated Entities			—				—				—				—				—				—				(2,105	)			—				(2,105	)			—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from Non-Controlling Interest Holders			—				—				15,200				—				—				15,200				—				—				15,200				—
Equity-Based Compensation			—				—				124,279				—				—				124,279				—				94,100				218,379				—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock			1,740,156				—				(17,639	)			—				—				(17,639	)			—				(7	)			(17,646	)			—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units			(6,969,237	)			—				(368,361	)			—				—				(368,361	)			—				—				(368,361	)			—
Change in The Blackstone Group Inc.’s Ownership Interest			—				—				13,785				—				—				13,785				—				(13,785	)			—				—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock			10,945,972				—				76,129				—				—				76,129				—				(76,129	)			—				—
Balance at June 30, 2020			676,874,583			$	7			$	6,272,040			$	(574,295	)		$	(36,758	)		$	5,660,994			$	3,900,429			$	2,866,043			$	12,427,466			$	68,564

(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.

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		Six Months Ended June 30,
		2021				2020
Operating Activities
Net Income (Loss)		$	6,228,633			$	(1,252,809	)
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities
Blackstone Funds Related
Net Realized Gains on Investments			(1,949,167	)			(261,870	)
Changes in Unrealized (Gains) Losses on Investments			(1,140,654	)			744,335
Non-Cash Performance Allocations			(5,161,667	)			2,385,158
Non-Cash Performance Allocations and Incentive Fee Compensation			2,780,561				(821,798	)
Equity-Based Compensation Expense			305,422				238,721
Amortization of Intangibles			37,476				35,500
Other Non-Cash Amounts Included in Net Income (Loss)			(153,350	)			(175,677	)
Cash Flows Due to Changes in Operating Assets and Liabilities
Accounts Receivable			346,505				562,123
Due from Affiliates			109,163				203,698
Other Assets			(55,225	)			(120,679	)
Accrued Compensation and Benefits			(440,034	)			(443,534	)
Securities Sold, Not Yet Purchased			(14,925	)			(26,840	)
Accounts Payable, Accrued Expenses and Other Liabilities			13,373				(182,034	)
Repurchase Agreements			(19,562	)			(73,498	)
Due to Affiliates			19,836				85,380
Investments Purchased			(2,718,024	)			(3,786,662	)
Cash Proceeds from Sale of Investments			5,007,907				4,381,268
Net Cash Provided by Operating Activities			3,196,268				1,490,782
Investing Activities
Purchase of Furniture, Equipment and Leasehold Improvements			(34,811	)			(25,453	)
Net Cash Used in Investing Activities			(34,811	)			(25,453	)
Financing Activities
Distributions to Non-Controlling Interest Holders in Consolidated Entities			(409,577	)			(305,914	)
Contributions from Non-Controlling Interest Holders in Consolidated Entities			407,738				355,599
Payments Under Tax Receivable Agreement			(51,366	)			(73,881	)
Net Settlement of Vested Common Stock and Repurchase of Common Stock and Blackstone Holdings Partnership Units			(312,114	)			(386,007	)

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		Six Months Ended June 30,
		2021				2020
Financing Activities (Continued)
Repayment and Repurchase of Loans Payable		$	—			$	(1,896	)
Dividends/Distributions to Shareholders and Unitholders			(2,278,390	)			(1,254,749	)
Net Cash Used in Financing Activities			(2,643,709	)			(1,666,848	)
Effect of Exchange Rate Changes on Cash and Cash Equivalents and Cash Held by Blackstone Funds and Other			(5,084	)			(2,419	)
Cash and Cash Equivalents and Cash Held by Blackstone Funds and Other
Net Increase (Decrease)			512,664				(203,938	)
Beginning of Period			2,064,456				2,523,651
End of Period		$	2,577,120			$	2,319,713
Supplemental Disclosure of Cash Flows Information
Payments for Interest		$	102,524			$	93,645
Payments for Income Taxes		$	289,244			$	42,330
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Non-Cash Contributions from Non-Controlling Interest Holders		$	6,076			$	16,033
Non-Cash Distributions to Non-Controlling Interest Holders		$	—			$	(75	)
Transfer of Interests to Non-Controlling Interest Holders		$	(3,593	)		$	(2,105	)
Change in The Blackstone Group Inc.’s Ownership Interest		$	3,877			$	13,785
Net Settlement of Vested Common Stock		$	124,386			$	71,978
Conversion of Blackstone Holdings Units to Common Stock		$	70,412			$	76,129
Acquisition of Ownership Interests from Non-Controlling Interest Holders
Deferred Tax Asset		$	(167,433	)		$	(148,838	)
Due to Affiliates		$	147,719			$	133,638
Equity		$	19,714			$	15,200

		June 30,				December 31,
		2021				2020
Cash and Cash Equivalents		$	2,467,444			$	1,999,484
Cash Held by Blackstone Funds and Other			109,676				64,972
		$	2,577,120			$	2,064,456

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1.    Organization

The Blackstone Group Inc., together with its consolidated subsidiaries (“Blackstone” or the “Company”), is one of the world’s leading investment firms. Blackstone’s asset management business includes investment vehicles focused on real estate, private equity, public debt and equity, growth equity, opportunistic, non-investment grade credit, real assets and secondary funds, all on a global basis. “Blackstone Funds” refers to the funds and other vehicles that are managed by Blackstone. Blackstone’s business is organized into

four segments: Real Estate, Private Equity, Hedge Fund Solutions and Credit & Insurance.

Effective August 6, 2021, The Blackstone Group Inc. changed its name to Blackstone Inc. Blackstone Inc. was initially formed as The Blackstone Group L.P., a Delaware limited partnership, on March 12, 2007. Prior to its conversion (effective July 1, 2019) to a Delaware corporation (the “Conversion”), Blackstone Inc. was managed and operated by Blackstone Group Management L.L.C., which is wholly owned by Blackstone’s senior managing directors and controlled by 

one of Blackstone’s founders, Stephen A. Schwarzman (the “Founder”). Effective February 26, 2021, the Certificate of Incorporation of Blackstone Inc. was amended and restated to rename Blackstone’s Class A Common stock as “common stock” and reclassify Blackstone’s Class B common stock and Class C common stock into a new Series I preferred stock and a new Series II preferred stock, respectively. All references to common stock, series I preferred stock and series II preferred stock prior to such date refer to Class A, Class B and Class C common stock, respectively. See Note 13. “Income Taxes” and Note 14. “Earnings Per Share and Stockholders’ Equity — Stockholders’ Equity.”

The activities of Blackstone are conducted through its holding partnerships: Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P. (collectively, “Blackstone Holdings,” “Blackstone Holdings Partnerships” or the “Holding Partnerships”). Blackstone, through its wholly owned subsidiaries, is the sole general partner of each of the Holding Partnerships. Generally, holders of the limited partner interests in the Holding Partnerships may, four times each year, exchange their limited partnership interests (“Partnership Units”) for Blackstone common stock, on a one-to-one basis, exchanging one Partnership Unit from each of the Holding Partnerships for one share of Blackstone common stock.

2.    Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Blackstone have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q. The condensed consolidated financial statements, including these notes, are unaudited and exclude some of the disclosures required in audited financial statements. Management believes it has made all necessary adjustments (consisting of only normal recurring items) so that the condensed consolidated financial statements are presented fairly and that estimates made in preparing its condensed consolidated financial statements are reasonable and prudent. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in Blackstone’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission.

The condensed consolidated financial statements include the accounts of Blackstone, its wholly owned or majority owned subsidiaries, the consolidated entities which are considered to be variable interest entities and for which Blackstone is considered the primary beneficiary, and certain partnerships or similar entities which are not considered variable interest entities but in which the general partner is determined to have control.

All intercompany balances and transactions have been eliminated in consolidation.

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Restructurings within consolidated collateralized loan obligations (“CLOs”) are treated as investment purchases or sales, as applicable, in the Condensed Consolidated Statements of Cash Flows.

COVID-19

and Global Economic Market Conditions

The ongoing novel coronavirus

(“COVID-19”)

pandemic has caused disruption in the U.S. and global economies. More recently, broad-based economic recovery and activity in the U.S. have accelerated following meaningful progress on vaccine distribution, the easing of shutdowns and other restrictions and support from previously implemented fiscal and monetary stimulus. Nevertheless, both in the U.S. and abroad, there is continued uncertainty regarding the trajectory of a continuing recovery, particularly given the strength of the Delta variant. Accordingly, this recovery remains uneven with dispersion across sectors and regions. The estimates and assumptions underlying these consolidated financial statements are based on the information available as of June 30, 2021 for the current period and as of June 30, 2020 or December 31, 2020, as applicable. The estimates and assumptions include judgments about financial market and economic conditions which have changed, and may continue to change, over time.

Consolidation

Blackstone consolidates all entities that it controls through a majority voting interest or otherwise, including those Blackstone Funds in which the general partner has a controlling financial interest. Blackstone has a controlling financial interest in Blackstone Holdings because the limited partners do not have the right to dissolve the partnerships or have substantive kick-out rights or participating rights that would overcome the control held by Blackstone. Accordingly, Blackstone consolidates Blackstone Holdings and records non-controlling interests to reflect the economic interests of the limited partners of Blackstone Holdings.

In addition, Blackstone consolidates all variable interest entities (“VIE”) for which it is the primary beneficiary. An enterprise is determined to be the primary beneficiary if it holds a controlling financial interest. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The consolidation guidance requires an analysis to determine (a) whether an entity in which Blackstone holds a variable interest is a VIE and (b) whether Blackstone’s involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests, would give it a controlling financial interest. Performance of that analysis requires the exercise of judgment.

Blackstone determines whether it is the primary beneficiary of a VIE at the time it becomes involved with a variable interest entity and continuously reconsiders that conclusion. In determining whether Blackstone is the primary beneficiary, Blackstone evaluates its control rights as well as economic interests in the entity held either directly or indirectly by Blackstone. The consolidation analysis can generally be performed qualitatively; however, if it is not readily apparent that Blackstone is not the primary beneficiary, a quantitative analysis may also be performed. Investments and redemptions (either by Blackstone, affiliates of Blackstone or third parties) or amendments to the governing documents of the respective Blackstone Funds could affect an entity’s status as a VIE or the determination of the primary beneficiary. At each reporting date, Blackstone assesses whether it is the primary beneficiary and will consolidate or deconsolidate accordingly.

Assets of consolidated VIEs that can only be used to settle obligations of the consolidated VIE and liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of Blackstone are presented in a separate section in the Condensed Consolidated Statements of Financial Condition.

Blackstone’s other disclosures regarding VIEs are discussed in Note 9. “Variable Interest Entities.”

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Revenue Recognition

Revenues primarily consist of management and advisory fees, incentive fees, investment income, interest and dividend revenue and other.

Management and advisory fees and incentive fees are accounted for as contracts with customers. Under the guidance for contracts with customers, an entity is required to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. See Note 18. “Segment Reporting” for a disaggregated presentation of revenues from contracts with customers.

Management and Advisory Fees, Net

 — Management and Advisory Fees, Net are comprised of management fees, including base management fees, transaction and other fees and advisory fees net of management fee reductions and offsets.

Blackstone earns base management fees from limited partners of funds in each of its managed funds, at a fixed percentage of assets under management, net asset value, total assets, committed capital or invested capital. These customer contracts require Blackstone to provide investment management services, which represents a performance obligation that Blackstone satisfies over time. Management fees are a form of variable consideration because the fees Blackstone is entitled to vary based on fluctuations in the basis for the management fee. The amount recorded as revenue is generally determined at the end of the period because these management fees are payable on a regular basis (typically quarterly) and are not subject to clawback once paid.

Transaction, advisory and other fees are principally fees charged to the limited partners of funds indirectly through the managed funds and portfolio companies. The investment advisory agreements generally require that the investment adviser reduce the amount of management fees payable by the limited partners to Blackstone (“management fee reductions”) by an amount equal to a portion of the transaction and other fees paid to Blackstone by the portfolio companies. The amount of the reduction varies by fund, the type of fee paid by the portfolio company and the previously incurred expenses of the fund. These fees and associated management fee reductions are a component of the transaction price for Blackstone’s performance obligation to provide investment management services to the limited partners of funds and are recognized as changes to the transaction price in the period in which they are charged and the services are performed.

Management fee offsets are reductions to management fees payable by the limited partners of the Blackstone Funds, which are based on the amount such limited partners reimburse the Blackstone Funds or Blackstone primarily for placement fees. Providing investment management services requires Blackstone to arrange for services on behalf of its customers. In those situations where Blackstone is acting as an agent on behalf of the limited partners of funds, it presents the cost of services as net against management fee revenue. In all other situations, Blackstone is primarily responsible for fulfilling the services and is therefore acting as a principal for those arrangements. As a result, the cost of those services is presented as Compensation or General, Administrative and Other expense, as appropriate, with any reimbursement from the limited partners of the funds recorded as Management and Advisory Fees, Net. In cases where the limited partners of the funds are determined to be the customer in an arrangement, placement fees may be capitalized as a cost to acquire a customer contract. Capitalized placement fees are amortized over the life of the customer contract, are recorded within Other Assets in the Condensed Consolidated Statements of Financial Condition and amortization is recorded within General, Administrative and Other within the Condensed Consolidated Statements of Operations.

Accrued but unpaid Management and Advisory Fees, net of management fee reductions and management fee offsets, as of the reporting date are included in Accounts Receivable or Due from Affiliates in the Condensed Consolidated Statements of Financial Condition.

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Incentive Fees 

— Contractual fees earned based on the performance of Blackstone Funds (“Incentive Fees”) are a form of variable consideration in Blackstone’s contracts with customers to provide investment management services. Incentive Fees are earned based on fund performance during the period, subject to the achievement of minimum return levels, or high water marks, in accordance with the respective terms set out in each fund’s governing agreements. Incentive Fees will not be recognized as revenue until (a) it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur, or (b) the uncertainty associated with the variable consideration is subsequently resolved. Incentive Fees are typically recognized as revenue when realized at the end of the measurement period. Once realized, such fees are not subject to clawback or reversal. Accrued but unpaid Incentive Fees charged directly to investors in Blackstone Funds as of the reporting date are recorded within Due from Affiliates in the Condensed Consolidated Statements of Financial Condition.

Investment Income (Loss)

 — Investment Income (Loss) represents the unrealized and realized gains and losses on Blackstone’s Performance Allocations and Principal Investments.

In carry fund structures, Blackstone, through its subsidiaries, invests alongside its limited partners in a partnership and is entitled to its pro-rata share of the results of the fund (a “pro-rata allocation”). In addition to a pro-rata allocation, and assuming certain investment returns are achieved, Blackstone is entitled to a disproportionate allocation of the income otherwise allocable to the limited partners, commonly referred to as carried interest (“Performance Allocations”).

Performance Allocations are made to the general partner based on cumulative fund performance to date, subject to a preferred return to limited partners. At the end of each reporting period, Blackstone calculates the balance of accrued Performance Allocations (“Accrued Performance Allocations”) that would be due to Blackstone for each fund, pursuant to the fund agreements, as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as Accrued Performance Allocations to reflect either (a) positive performance resulting in an increase in the Accrued Performance Allocation to the general partner or (b) negative performance that would cause the amount due to Blackstone to be less than the amount previously recognized as revenue, resulting in a negative adjustment to the Accrued Performance Allocation to the general partner. In each scenario, it is necessary to calculate the Accrued Performance Allocation on cumulative results compared to the Accrued Performance Allocation recorded to date and make the required positive or negative adjustments. Blackstone ceases to record negative Performance Allocations once previously Accrued Performance Allocations for such fund have been fully reversed. Blackstone is not obligated to pay guaranteed returns or hurdles, and therefore, cannot have negative Performance Allocations over the life of a fund. Accrued Performance Allocations as of the reporting date are reflected in Investments in the Condensed Consolidated Statements of Financial Condition.

Performance Allocations are realized when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the preferred return or, in limited instances, after certain thresholds for return of capital are met. Performance Allocations are subject to clawback to the extent that the Performance Allocation received to date exceeds the amount due to Blackstone based on cumulative results. As such, the accrual for potential repayment of previously received Performance Allocations, which is a component of Due to Affiliates, represents all amounts previously distributed to Blackstone Holdings and non-controlling interest holders that would need to be repaid to the Blackstone carry funds if the Blackstone carry funds were to be liquidated based on the current fair value of the underlying funds’ investments as of the reporting date. The actual clawback liability, however, generally does not become realized until the end of a fund’s life except for certain funds, including certain Blackstone real estate funds, multi-asset class investment funds and credit-focused funds, which may have an interim clawback liability.

Principal Investments include the unrealized and realized gains and losses on Blackstone’s principal investments, including its investments in Blackstone Funds that are not consolidated and receive pro-rata allocations, its equity method investments, and other principal investments. Income (Loss) on Principal

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Investments is realized when Blackstone redeems all or a portion of its investment or when Blackstone receives cash income, such as dividends or distributions. Unrealized Income (Loss) on Principal Investments results from changes in the fair value of the underlying investment as well as the reversal of unrealized gain (loss) at the time an investment is realized.

Interest and Dividend Revenue 

— Interest and Dividend Revenue comprises primarily interest and dividend income earned on principal investments not accounted for under the equity method held by Blackstone.

Other Revenue

 — Other Revenue consists of miscellaneous income and foreign exchange gains and losses arising on transactions denominated in currencies other than U.S. dollars.

Fair Value of Financial Instruments

GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows:

 

●

Level I – Quoted prices are available in active markets for identical financial instruments as of the reporting date. The types of financial instruments in Level I include listed equities, listed derivatives and mutual funds with quoted prices. Blackstone does not adjust the quoted price for these investments, even in situations where Blackstone holds a large position and a sale could reasonably impact the quoted price.

 

●

Level II – Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Financial instruments which are generally included in this category include corporate bonds and loans, including corporate bonds and loans held within CLO vehicles, government and agency securities, less liquid and restricted equity securities, and certain over-the-counter derivatives where the fair value is based on observable inputs. Senior and subordinated notes issued by CLO vehicles are classified within Level II of the fair value hierarchy.

 

●

Level III – Pricing inputs are unobservable for the financial instruments and includes situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category generally include general and limited partnership interests in private equity and real estate funds, credit-focused funds, distressed debt and non-investment grade residual interests in securitizations, certain corporate bonds and loans held within CLO vehicles and certain over-the-counter derivatives where the fair value is based on unobservable inputs.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. Blackstone’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

Level II Valuation Techniques

Financial instruments classified within Level II of the fair value hierarchy comprise debt instruments, including certain corporate loans and bonds held by Blackstone’s consolidated CLO vehicles and debt securities sold, not yet purchased. Certain equity securities and derivative instruments valued using observable inputs are also classified as Level II.

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The valuation techniques used to value financial instruments classified within Level II of the fair value hierarchy are as follows:

 

●

Debt Instruments and Equity Securities are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices and market transactions in comparable investments and various relationships between investments. The valuation of certain equity securities is based on an observable price for an identical security adjusted for the effect of a restriction.

 

●

Freestanding Derivatives are valued using contractual cash flows and observable inputs comprising yield curves, foreign currency rates and credit spreads.

 

●

Senior and subordinate notes issued by CLO vehicles are classified based on the more observable fair value of CLO assets less (a) the fair value of any beneficial interests held by Blackstone, and (b) the carrying value of any beneficial interests that represent compensation for services.

Level III Valuation Techniques

In the absence of observable market prices, Blackstone values its investments using valuation methodologies applied on a consistent basis. For some investments little market activity may exist; management’s determination of fair value is then based on the best information available in the circumstances, and may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors, including the appropriate risk adjustments for non-performance and liquidity risks. Investments for which market prices are not observable include private investments in the equity of operating companies, real estate properties, certain funds of hedge funds and credit-focused investments.

Real Estate Investments –

The fair values of real estate investments are determined by considering projected operating cash flows, sales of comparable assets, if any, and replacement costs, among other measures. The methods used to estimate the fair value of real estate investments include the discounted cash flow method and/or capitalization rates (“cap rates”) analysis. Valuations may be derived by reference to observable valuation measures for comparable companies or assets (for example, multiplying a key performance metric of the investee company or asset, such as EBITDA, by a relevant valuation multiple observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar methods. Where a discounted cash flow method is used, a terminal value is derived by reference to an exit EBITDA multiple or capitalization rate. Additionally, where applicable, projected distributable cash flow-through debt maturity will be considered in support of the investment’s fair value.

Private Equity Investments –

The fair values of private equity investments are determined by reference to projected net earnings, earnings before interest, taxes, depreciation and amortization (“EBITDA”), the discounted cash flow method, public market or private transactions, valuations for comparable companies and other measures which, in many cases, are based on unaudited information at the time received. Valuations may be derived by reference to observable valuation measures for comparable companies or transactions (for example, multiplying a key performance metric of the investee company, such as EBITDA, by a relevant valuation multiple observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar methods. Where a discounted cash flow method is used, a terminal value is derived by reference to EBITDA or price/earnings exit multiples.

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Credit-Focused Investments

– The fair values of credit-focused investments are generally determined on the basis of prices between market participants provided by reputable dealers or pricing services. For credit-focused investments that are not publicly traded or whose market prices are not readily available, Blackstone may utilize other valuation techniques, including the discounted cash flow method or a market approach. The discounted cash flow method projects the expected cash flows of the debt instrument based on contractual terms, and discounts such cash flows back to the valuation date using a market-based yield. The market-based yield is estimated using yields of publicly traded debt instruments issued by companies operating in similar industries as the subject investment, with similar leverage statistics and time to maturity.

The market approach is generally used to determine the enterprise value of the issuer of a credit investment, and considers valuation multiples of comparable companies or transactions. The resulting enterprise value will dictate whether or not such credit investment has adequate enterprise value coverage. In cases of distressed credit instruments, the market approach may be used to estimate a recovery value in the event of a restructuring.

Investments, at Fair Value

The Blackstone Funds are accounted for as investment companies under the American Institute of Certified Public Accountants Accounting and Auditing Guide,

Investment Companies

, and in accordance with the GAAP guidance on investment companies and reflect their investments, including majority owned and controlled investments (the “Portfolio Companies”), at fair value. Such consolidated funds’ investments are reflected in Investments on the Condensed Consolidated Statements of Financial Condition at fair value, with unrealized gains and losses resulting from changes in fair value reflected as a component of Net Gains from Fund Investment Activities in the Condensed Consolidated Statements of Operations. Fair value is the amount that would be received to sell an asset or paid to transfer a liability, in an orderly transaction between market participants at the measurement date, at current market conditions (i.e., the exit price).

Blackstone’s principal investments are presented at fair value with unrealized appreciation or depreciation and realized gains and losses recognized in the Condensed Consolidated Statements of Operations within Investment Income (Loss).

For certain instruments, Blackstone has elected the fair value option. Such election is irrevocable and is applied on an investment by investment basis at initial recognition. Blackstone has applied the fair value option for certain loans and receivables, unfunded loan commitments and certain investments in private debt securities that otherwise would not have been carried at fair value with gains and losses recorded in net income. The methodology for measuring the fair value of such investments is consistent with the methodology applied to private equity, real estate, credit-focused and funds of hedge funds investments. Changes in the fair value of such instruments are recognized in Investment Income (Loss) in the Condensed Consolidated Statements of Operations. Interest income on interest bearing loans and receivables and debt securities on which the fair value option has been elected is based on stated coupon rates adjusted for the accretion of purchase discounts and the amortization of purchase premiums. This interest income is recorded within Interest and Dividend Revenue.

Blackstone has elected the fair value option for the assets of consolidated CLO vehicles. As permitted under GAAP, Blackstone measures the liabilities of consolidated CLO vehicles as (a) the sum of the fair value of the consolidated CLO assets and the carrying value of any non-financial assets held temporarily, less (b) the sum of the fair value of any beneficial interests retained by Blackstone (other than those that represent compensation for services) and Blackstone’s carrying value of any beneficial interests that represent compensation for services. As a result of this measurement alternative, there is no attribution of amounts to Non-Controlling Interests for consolidated CLO vehicles. Assets of the consolidated CLOs are presented within Investments within the Condensed Consolidated Statements of Financial Condition and Liabilities within Loans Payable for the amounts due to unaffiliated third parties and Due to Affiliates for the amounts held by non-consolidated affiliates. Changes in the fair value of consolidated CLO assets and liabilities and related interest, dividend and other income are presented within Net Gains from Fund Investment Activities. Expenses of consolidated CLO vehicles are presented in Fund Expenses.

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Blackstone has elected the fair value option for certain proprietary investments that would otherwise have been accounted for using the equity method of accounting. The fair value of such investments is based on quoted prices in an active market or using the discounted cash flow method. Changes in fair value are recognized in Investment Income (Loss) in the Condensed Consolidated Statements of Operations.

Further disclosure on instruments for which the fair value option has been elected is presented in Note 7. “Fair Value Option.”

The investments of consolidated Blackstone Funds in funds of hedge funds (“Investee Funds”) are valued at net asset value (“NAV”) per share of the Investee Fund. In limited circumstances, Blackstone may determine, based on its own due diligence and investment procedures, that NAV per share does not represent fair value. In such circumstances, Blackstone will estimate the fair value in good faith and in a manner that it reasonably chooses, in accordance with the requirements of GAAP.

Certain investments of Blackstone and of the consolidated Blackstone funds of hedge funds and credit-focused funds measure their investments in underlying funds at fair value using NAV per share without adjustment. The terms of the investee’s investment generally provide for minimum holding periods or lock-ups, the institution of gates on redemptions or the suspension of redemptions or an ability to side-pocket investments, at the discretion of the investee’s fund manager, and as a result, investments may not be redeemable at, or within three months of, the reporting date. A side-pocket is used by hedge funds and funds of hedge funds to separate investments that may lack a readily ascertainable value, are illiquid or are subject to liquidity restriction. Redemptions are generally not permitted until the investments within a side-pocket are liquidated or it is deemed that the conditions existing at the time that required the investment to be included in the side-pocket no longer exist. As the timing of either of these events is uncertain, the timing at which Blackstone may redeem an investment held in a side-pocket cannot be estimated. Further disclosure on instruments for which fair value is measured using NAV per share is presented in Note 5. “Net Asset Value as Fair Value.”

Security and loan transactions are recorded on a trade date basis.

Equity Method Investments

Investments in which Blackstone is deemed to exert significant influence, but not control, are accounted for using the equity method of accounting except in cases where the fair value option has been elected. Blackstone has significant influence over all Blackstone Funds in which it invests but does not consolidate. Therefore, its investments in such Blackstone Funds, which include both a proportionate and disproportionate allocation of the profits and losses (as is the case with carry funds that include a Performance Allocation), are accounted for under the equity method. Under the equity method of accounting, Blackstone’s share of earnings (losses) from equity method investments is included in Investment Income (Loss) in the Condensed Consolidated Statements of Operations.

In cases where Blackstone’s equity method investments provide for a disproportionate allocation of the profits and losses (as is the case with carry funds that include a Performance Allocation), Blackstone’s share of earnings (losses) from equity method investments is determined using a balance sheet approach referred to as the hypothetical liquidation at book value (“HLBV”) method. Under the HLBV method, at the end of each reporting period, Blackstone calculates the Accrued Performance Allocations that would be due to Blackstone for each fund pursuant to the fund agreements as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as Accrued Performance Allocations to reflect either (a) positive performance resulting in an increase in the Accrued Performance Allocation to the general partner, or (b) negative performance that would cause the amount due to Blackstone to

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be less than the amount previously recognized as revenue, resulting in a negative adjustment to the Accrued Performance Allocation to the general partner. In each scenario, it is necessary to calculate the Accrued Performance Allocation on cumulative results compared to the Accrued Performance Allocation recorded to date and make the required positive or negative adjustments. Blackstone ceases to record negative Performance Allocations once previously Accrued Performance Allocations for such fund have been fully reversed. Blackstone is not obligated to pay guaranteed returns or hurdles, and therefore, cannot have negative Performance Allocations over the life of a fund. The carrying amounts of equity method investments are reflected in Investments in the Condensed Consolidated Statements of Financial Condition.

Results for Strategic Partners are reported on a three month lag from the fund financial statements, which generally report based on a three month lag from the underlying fund investments unless information is available on a more timely basis. Therefore, results presented herein do not include the impact of economic and market activity in the quarter in which such events occur. Economic and market activity for the periods presented is expected to affect reported results in upcoming periods.

Compensation and Benefits

Compensation and Benefits 

—

Compensation

 — Compensation consists of (a) salary and bonus, and benefits paid and payable to employees and senior managing directors and (b) equity-based compensation associated with the grants of equity-based awards to employees and senior managing directors. Compensation cost relating to the issuance of equity-based awards to senior managing directors and employees is measured at fair value at the grant date, and expensed over the vesting period on a straight-line basis, taking into consideration expected forfeitures, except in the case of (a) equity-based awards that do not require future service, which are expensed immediately, and (b) certain awards to recipients that meet criteria making them eligible for retirement (allowing such recipient to keep a percentage of those awards upon departure from Blackstone after becoming eligible for retirement), for which the expense for the portion of the award that would be retained in the event of retirement is either expensed immediately or amortized to the retirement date. Cash settled equity-based awards are classified as liabilities and are remeasured at the end of each reporting period.

Compensation and Benefits — Incentive Fee Compensation —

Incentive Fee Compensation consists of compensation paid based on Incentive Fees.

Compensation and Benefits — Performance Allocations Compensation —

Performance Allocation Compensation consists of compensation paid based on Performance Allocations (which may be distributed in cash or in-kind). Such compensation expense is subject to both positive and negative adjustments. Unlike Performance Allocations, compensation expense is based on the performance of individual investments held by a fund rather than on a fund by fund basis. These amounts may also include allocations of investment income from Blackstone’s principal investments, to senior managing directors and employees participating in certain profit sharing initiatives.

Non-Controlling Interests in Consolidated Entities

Non-Controlling Interests in Consolidated Entities represent the component of Equity in consolidated Blackstone Funds held by third party investors and employees. The percentage interests held by third parties and employees is adjusted for general partner allocations and by subscriptions and redemptions in funds of hedge funds and certain credit-focused funds which occur during the reporting period. In addition, all non-controlling interests in consolidated Blackstone Funds are attributed a share of income (loss) arising from the respective funds and a share of other comprehensive income, if applicable. Income (Loss) is allocated to non-controlling interests in consolidated entities based on the relative ownership interests of third party investors and employees after considering any contractual arrangements that govern the allocation of income (loss) such as fees allocable to The Blackstone Group Inc.

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Redeemable Non-Controlling Interests in Consolidated Entities

Non-controlling interests related to funds of hedge funds are subject to annual, semi-annual or quarterly redemption by investors in these funds following the expiration of a specified period of time, or may be withdrawn subject to a redemption fee during the period when capital may not be withdrawn. As limited partners in these types of funds have been granted redemption rights, amounts relating to third party interests in such consolidated funds are presented as Redeemable Non-Controlling Interests in Consolidated Entities within the Condensed Consolidated Statements of Financial Condition. When redeemable amounts become legally payable to investors, they are classified as a liability and included in Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition. For all consolidated funds in which redemption rights have not been granted, non-controlling interests are presented within Equity in the Condensed Consolidated Statements of Financial Condition as Non-Controlling Interests in Consolidated Entities.

Non-Controlling Interests in Blackstone Holdings

Non-Controlling Interests in Blackstone Holdings represent the component of Equity in the consolidated Blackstone Holdings Partnerships held by Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships.

Certain costs and expenses are borne directly by the Holdings Partnerships. Income (Loss), excluding those costs directly borne by and attributable to the Holdings Partnerships, is attributable to Non-Controlling Interests in Blackstone Holdings. This residual attribution is based on the year to date average percentage of Blackstone Holdings Partnership Units and unvested participating Holdings Partnership Units held by Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships. Unvested participating Holdings Partnership Units are excluded from the attribution in periods of loss as they are not contractually obligated to share in losses of the Holdings Partnerships.

Net Income (Loss) Per Share of Common Stock

Basic Income (Loss) Per Share of Common Stock is calculated by dividing Net Income (Loss) Attributable to The Blackstone Group Inc. by the weighted-average shares of common stock, unvested participating shares of common stock outstanding for the period and vested deferred restricted shares of common stock that have been earned for which issuance of the related shares of common stock is deferred until future periods. Diluted Income (Loss) Per Share of Common Stock reflects the impact of all dilutive securities. Unvested participating shares of common stock are excluded from the computation in periods of loss as they are not contractually obligated to share in losses.

Blackstone applies the treasury stock method to determine the dilutive weighted-average common shares outstanding for certain equity-based compensation awards. Blackstone applies the “if-converted” method to the Blackstone Holdings Partnership Units to determine the dilutive impact, if any, of the exchange right included in the Blackstone Holdings Partnership Units.

Reverse Repurchase and Repurchase Agreements

Securities purchased under agreements to resell (“reverse repurchase agreements”) and securities sold under agreements to repurchase (“repurchase agreements”), comprised primarily of U.S. and non-U.S. government and agency securities, asset-backed securities and corporate debt, represent collateralized financing transactions. Such transactions are recorded in the Condensed Consolidated Statements of Financial Condition at their contractual amounts and include accrued interest. The carrying value of reverse repurchase and repurchase agreements approximates fair value.

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Blackstone manages credit exposure arising from reverse repurchase agreements and repurchase agreements by, in appropriate circumstances, entering into master netting agreements and collateral arrangements with counterparties that provide Blackstone, in the event of a counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations.

Blackstone takes possession of securities purchased under reverse repurchase agreements and is permitted to repledge, deliver or otherwise use such securities. Blackstone also pledges its financial instruments to counterparties to collateralize repurchase agreements. Financial instruments pledged that can be repledged, delivered or otherwise used by the counterparty are recorded in Investments in the Condensed Consolidated Statements of Financial Condition. Additional disclosures relating to repurchase agreements are discussed in Note 10. “Repurchase Agreements.”

Blackstone does not offset assets and liabilities relating to reverse repurchase agreements and repurchase agreements in its Condensed Consolidated Statements of Financial Condition. Additional disclosures relating to offsetting are discussed in Note 11. “Offsetting of Assets and Liabilities.”

Securities Sold, Not Yet Purchased

Securities Sold, Not Yet Purchased consist of equity and debt securities that Blackstone has borrowed and sold. Blackstone is required to “cover” its short sale in the future by purchasing the security at prevailing market prices and delivering it to the counterparty from which it borrowed the security. Blackstone is exposed to loss in the event that the price at which a security may have to be purchased to cover a short sale exceeds the price at which the borrowed security was sold short.

Securities Sold, Not Yet Purchased are recorded at fair value in the Condensed Consolidated Statements of Financial Condition.

Derivative Instruments

Blackstone recognizes all derivatives as assets or liabilities on its Condensed Consolidated Statements of Financial Condition at fair value. On the date Blackstone enters into a derivative contract, it designates and documents each derivative contract as one of the following: (a) a hedge of a recognized asset or liability (“fair value hedge”), (b) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow hedge”), (c) a hedge of a net investment in a foreign operation, or (d) a derivative instrument not designated as a hedging instrument (“freestanding derivative”). Gains or losses on a derivative instrument that is designated as, and is effective as, an economic hedge of a net investment in a foreign operation are reported in the cumulative translation adjustment section of other comprehensive income to the extent it is effective as a hedge. The ineffective portion of a net investment hedge is recognized in current period earnings.

Blackstone formally documents at inception its hedge relationships, including identification of the hedging instruments and the hedged items, it

s

 risk management objectives, strategy for undertaking the hedge transaction and Blackstone’s evaluation of effectiveness of its hedged transaction. At least monthly, Blackstone also formally assesses whether the derivative it designated in each hedging relationship is expected to be, and has been, highly effective in offsetting changes in estimated fair values or cash flows of the hedged items using either the regression analysis or the dollar offset method. For net investment hedges, Blackstone uses a method based on changes in spot rates to measure effectiveness. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued. The fair values of hedging derivative instruments are reflected within Other Assets in the Condensed Consolidated Statements of Financial Condition.

For freestanding derivative contracts, Blackstone presents changes in fair value in current period earnings. Changes in the fair value of derivative instruments held by consolidated Blackstone Funds are reflected in Net Gains from Fund Investment Activities or, where derivative instruments are held by Blackstone, within Investment Income (Loss) in the Condensed Consolidated Statements of Operations. The fair value of freestanding derivative assets of the consolidated Blackstone Funds are recorded within Investments, the

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fair value of freestanding derivative assets that are not part of the consolidated Blackstone Funds are recorded within Other Assets and the fair value of freestanding derivative liabilities are recorded within Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition.

Blackstone has elected to not offset derivative assets and liabilities or financial assets in its Condensed Consolidated Statements of Financial Condition, including cash, that may be received or paid as part of collateral arrangements, even when an enforceable master netting agreement is in place that provides Blackstone, in the event of counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations.

Blackstone’s other disclosures regarding derivative financial instruments are discussed in Note 6. “Derivative Financial Instruments.”

Blackstone’s disclosures regarding offsetting are discussed in Note 11. “Offsetting of Assets and Liabilities.”

Affiliates

Blackstone considers its Founder, senior managing directors, employees, the Blackstone Funds and the Portfolio Companies to be affiliates.

Dividends

Dividends are reflected in the condensed consolidated financial statements when declared.

3.    Intangible Assets

Intangible Assets, Net consists of the following:

 

		June 30,				December 31,
		2021				2020
Finite-Lived Intangible Assets/Contractual Rights		$	1,745,376			$	1,734,076
Accumulated Amortization			(1,423,596	)			(1,386,121	)
Intangible Assets, Net		$	321,780			$	347,955

Amortization expense associated with Blackstone’s intangible assets was $18.7 million and $37.5 million for the three and six month periods ended June 30, 2021, respectively, and $17.7 million and $35.5 million for the three and six month periods ended June 30, 2020, respectively.

Amortization of Intangible Assets held at June 30, 2021 is expected to be $74.9 million, $67.1 million, $38.1 million, $30.5 million, and $30.5 million for each of the years ending December 31, 2021, 2022, 2023, 2024 and 2025, respectively. Blackstone’s Intangible Assets as of June 30, 2021 are expected to amortize over a weighted-average period of 7.3 years.

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4.    Investments

Investments consist of the following:

 

		June 30,				December 31,
		2021				2020
Investments of Consolidated Blackstone Funds		$	1,871,269			$	1,455,008
Equity Method Investments
Partnership Investments			4,916,674				4,353,234
Accrued Performance Allocations			12,101,142				6,891,262
Corporate Treasury Investments			2,440,325				2,579,716
Other Investments			833,912				337,922
		$	22,163,322			$	15,617,142

Blackstone’s share of Investments of Consolidated Blackstone Funds totaled $417.9 million and $198.3 million at June 30, 2021 and December 31, 2020, respectively.

Where appropriate, the accounting for Blackstone’s investments incorporates the changes in fair value of those investments as determined under GAAP. The significant inputs and assumptions required to determine the change in fair value of the investments of Consolidated Blackstone Funds, Corporate Treasury Investments and Other Investments are discussed in more detail in Note 8. “Fair Value Measurements of Financial Instruments.”

Investments of Consolidated Blackstone Funds

The following table presents the Realized and Net Change in Unrealized Gains (Losses) on investments held by the consolidated Blackstone Funds and a reconciliation to Other Income (Loss) – Net Gains (Losses) from Fund Investment Activities in the Condensed Consolidated Statements of Operations:

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
Realized Gains (Losses)		$	33,001			$	(61,698	)		$	61,995			$	(134,972	)
Net Change in Unrealized Gains (Losses)			88,489				216,552				172,956				(116,790	)
Realized and Net Change in Unrealized Gains (Losses) from Consolidated Blackstone Funds			121,490				154,854				234,951				(251,762	)
Interest and Dividend Revenue Attributable to Consolidated Blackstone Funds			5,626				3,443				12,518				82,685
Other Income (Loss) – Net Gains (Losses) from Fund Investment Activities		$	127,116			$	158,297			$	247,469			$	(169,077	)

Equity Method Investments

Blackstone’s equity method investments include Partnership Investments, which represent the pro-rata investments, and any associated Accrued Performance Allocations in private equity funds, real estate funds, funds of hedge funds and credit-focused funds. Prior to January 26, 2021, Partnership Investments also included the 40% non-controlling interest in Pátria Investments Limited and Pátria Investimentos Ltda. (collectively, “Pátria”).

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On January 26, 2021, Pátria completed its initial public offering (“IPO”), pursuant to which Blackstone sold a portion of its interests and no longer has representatives or the right to designate representatives on Pátria’s board of directors. As a result of Pátria’s pre-IPO reorganization transactions (which included Blackstone’s sale of 10% of Pátria’s pre-IPO shares to Pátria’s controlling shareholder) and the consummation of the IPO, Blackstone is deemed to no longer have significant influence over Pátria due to Blackstone’s decreased ownership and lack of board representation. Following the IPO, Blackstone will account for its retained interest in Pátria at fair value in accordance with the GAAP guidance for investments in equity securities with a readily determinable fair value.

Blackstone evaluates each of its equity method investments, excluding Accrued Performance Allocations, to determine if any were significant as defined by guidance from the United States Securities and Exchange Commission. As of and for the six months ended June 30, 2021 and 2020, no individual equity method investment held by Blackstone met the significance criteria. As such, Blackstone is not required to present separate financial statements for any of its equity method investments.

Partnership Investments

Blackstone recognized net gains related to its Partnership Investments accounted for under the equity method of $423.3 million and $247.8 million for the three months ended June 30, 2021 and 2020, respectively. Blackstone recognized net gains (losses) related to its equity method investments of $1.1 billion and $(318.7) million for the six months ended June 30, 2021 and 2020, respectively.

Accrued Performance Allocations

Accrued Performance Allocations to Blackstone were as follows:

 

		Real				Private				Hedge Fund				Credit &
		Estate				Equity				Solutions				Insurance				Total
Accrued Performance Allocations, December 31, 2020		$	3,033,462			$	3,487,206			$	42,293			$	328,301			$	6,891,262
Performance Allocations as a Result of Changes in Fund Fair Values			2,210,007				3,717,840				405,611				176,351				6,509,809
Foreign Exchange Loss			(17,258	)			—				—				—				(17,258	)
Fund Distributions			(703,349	)			(488,879	)			(14,243	)			(76,200	)			(1,282,671	)
Accrued Performance Allocations, June 30, 2021		$	4,522,862			$	6,716,167			$	433,661			$	428,452			$	12,101,142

Corporate Treasury Investments

The portion of corporate treasury investments included in Investments represents Blackstone’s investments into primarily fixed income securities, mutual fund interests, and other fund interests. These strategies are managed by a combination of Blackstone personnel and third party advisors.

The following table presents the Realized and Net Change in Unrealized Gains (Losses) on these investments:

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Realized Gains (Losses)		$	(1,049	)		$	(4,273	)		$	5,885			$	(1,756	)
Net Change in Unrealized Gains (Losses)			29,523				114,990				39,452				(143,397	)
		$	28,474			$	110,717			$	45,337			$	(145,153	)

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Other Investments

Other Investments consist primarily of proprietary investment securities held by Blackstone, including subordinated notes in non-consolidated CLO vehicles and the retained interest in Pátria following Pátria’s IPO. Other Investments include equity investments without readily determinable fair values which have a carrying value of $113.1 million as of June 30, 2021. The following table presents Blackstone’s Realized and Net Change in Unrealized Gains (Losses) in Other Investments:

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
Realized Gains		$	29,309			$	6,348			$	29,422			$	13,333
Net Change in Unrealized Gains (Losses)			1,065				26,573				285,567				(73,364	)
		$	30,374			$	32,921			$	314,989			$	(60,031)

5.    Net Asset Value as Fair Value

A summary of fair value by strategy type and ability to redeem such investments as of June 30, 2021 is presented below:

 

Redemption

Frequency

Redemption

Strategy (a)

Fair Value

(if currently eligible)

Notice Period

Diversified Instruments

$

994

(b)

(b)

Credit Driven

299,130

(c)

(c)

Equity

50,440

(d)

(d)

Commodities

990

(e)

(e)

$

351,554

 

(a)	As of June 30, 2021, Blackstone had no unfunded commitments.

(b)	Diversified Instruments include investments in funds that invest across multiple strategies. Investments representing 100% of the fair value of the investments in this category may not be redeemed at, or within three months of, the reporting date.

(c)

The Credit Driven category includes investments in hedge funds that invest primarily in domestic and international bonds. Investments representing 5% of the fair value of the investments in this category are in liquidation. The remaining 95% of investments in this category may not be redeemed at, or within three months of, the reporting date.

(d)

The Equity category includes investments in hedge funds that invest primarily in domestic and international equity securities. Investments representing 1% of the fair value of the investments in this category are in liquidation. The remaining 99% of investments in this category are redeemable as of the reporting date. As of the reporting date, the investee fund manager had elected to side-pocket  1% of Blackstone’s investments in the category.

(e)

The Commodities category includes investments in commodities-focused funds that primarily invest in futures and physical-based commodity driven strategies. Investments representing 100% of the fair value of the investments in this category may not be redeemed at, or within three months of, the reporting date.

6.    Derivative Financial Instruments

Blackstone and the consolidated Blackstone Funds enter into derivative contracts in the normal course of business to achieve certain risk management objectives and for general investment purposes. Blackstone may enter into derivative contracts in order to hedge its interest rate risk exposure against the effects of interest rate

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changes. Additionally, Blackstone may also enter into derivative contracts in order to hedge its foreign currency risk exposure against the effects of a portion of its non-U.S. dollar denominated currency net investments. As a result of the use of derivative contracts, Blackstone and the consolidated Blackstone Funds are exposed to the risk that counterparties will fail to fulfill their contractual obligations. To mitigate such counterparty risk, Blackstone and the consolidated Blackstone Funds enter into contracts with certain major financial institutions, all of which have investment grade ratings. Counterparty credit risk is evaluated in determining the fair value of derivative instruments.

Freestanding Derivatives

Freestanding derivatives are instruments that Blackstone and certain of the consolidated Blackstone Funds have entered into as part of their overall risk management and investment strategies. These derivative contracts are not designated as hedging instruments for accounting purposes. Such contracts may include interest rate swaps, foreign exchange contracts, equity swaps, options, futures and other derivative contracts.

The table below summarizes the aggregate notional amount and fair value of the derivative financial instruments. The notional amount represents the absolute value amount of all outstanding derivative contracts.

 

		June 30, 2021																December 31, 2020
		Assets								Liabilities								Assets								Liabilities
						Fair								Fair								Fair								Fair
		Notional				Value				Notional				Value				Notional				Value				Notional				Value
Freestanding Derivatives
Blackstone
Interest Rate Contracts		$	882,179			$	103,813			$	916,011			$	139,841			$	684,320			$	113,072			$	862,887			$	190,342
Foreign Currency Contracts			104,040				1,536				362,161				6,143				316,787				7,392				334,015				3,941
Credit Default Swaps			2,007				161				10,183				1,050				2,706				331				9,158				1,350
Other			—				—				—				—				5,000				5,227				—				—
			988,226				105,510				1,288,355				147,034				1,008,813				126,022				1,206,060				195,633
Investments of Consolidated Blackstone Funds
Foreign Currency Contracts			76,410				2,066				5,299				35				—				—				66,431				2,651
Interest Rate Contracts			—				—				14,000				1,094				—				—				14,000				1,485
Credit Default Swaps			3,507				291				23,484				1,130				8,282				542				41,290				1,558
Total Return Swaps			—				—				—				—				—				—				19,275				2,125
			79,917				2,357				42,783				2,259				8,282				542				140,996				7,819
		$	1,068,143			$	107,867			$	1,331,138			$	149,293			$	1,017,095			$	126,564			$	1,347,056			$	203,452

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The table below summarizes the impact to the Condensed Consolidated Statements of Operations from derivative financial instruments:

 

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Freestanding Derivatives
Realized Gains (Losses)
Interest Rate Contracts		$	(348	)		$	(2,613	)		$	1,298			$	(7,914	)
Foreign Currency Contracts			2,887				8,567				4,423				(5,140	)
Credit Default Swaps			(8	)			(13	)			(990	)			(112	)
Total Return Swaps			(65	)			(782	)			(1,415	)			(1,531	)
Other			—				—				(40	)			(38	)
			2,466				5,159				3,276				(14,735	)
Net Change in Unrealized Gains (Losses)
Interest Rate Contracts			39,484				(27,963	)			45,185				80,335
Foreign Currency Contracts			(3,249	)			(8,258	)			(3,376	)			3,587
Credit Default Swaps			—				18				842				(1,371	)
Total Return Swaps			—				877				2,130				(4,099	)
Other			—				—				(20	)			36
			36,235				(35,326	)			44,761				78,488
		$	38,701			$	(30,167	)		$	48,037			$	63,753

As of June 30, 2021 and December 31, 2020,

Blackstone

had

not

designated

any

derivatives

as

cash

flow

hedges

.

7.    Fair Value Option

The following table summarizes the financial instruments for which the fair value option has been elected:

 

		June 30,				December 31,
		2021				2020
Assets
Loans and Receivables		$	223,796			$	581,079
Equity and Preferred Securities			695,434				532,790
Debt Securities			329,555				448,352
		$	1,248,785			$	1,562,221
Liabilities
Corporate Treasury Commitments		$	447			$	244

---

The following tables present the Realized and Net Change in Unrealized Gains (Losses) on financial instruments on which the fair value option was elected:

		Three Months Ended June 30,
		2021								2020
						Net Change								Net Change
		Realized				in Unrealized				Realized				in Unrealized
		Gains (Losses)				Gains				Gains (Losses)				Gains (Losses)
Assets
Loans and Receivables		$	(3,065	)		$	7,012			$	(2,249	)		$	13,101
Equity and Preferred Securities			18,444				9,530				—				59,612
Debt Securities			1,303				1,923				(9,487	)			60,988
Assets of Consolidated CLO Vehicles (a)
Corporate Loans			—				—				(52,293	)			538,367
		$	16,682			$	18,465			$	(64,029	)		$	672,068
Liabilities
Liabilities of Consolidated CLO Vehicles (a)
Senior Secured Notes		$	—			$	—			$	—			$	(495,059	)
Subordinated Notes			—				—				—				73,504
Corporate Treasury Commitments			—				7				—				(2,030	)
		$	—			$	7			$	—			$	(423,585	)

 

		Six Months Ended June 30,
		2021								2020
						Net Change								Net Change
		Realized				in Unrealized				Realized				in Unrealized
		Gains (Losses)				Gains (Losses)				Gains (Losses)				Gains (Losses)
Assets
Loans and Receivables		$	(7,896	)		$	5,083			$	(5,770	)		$	(268	)
Equity and Preferred Securities			18,444				40,401				(342	)			(103,747	)
Debt Securities			9,970				(4,235	)			(21,103	)			(9,129	)
Assets of Consolidated CLO Vehicles (a)
Corporate Loans			—				—				(96,194	)			(226,542	)
Other			—				—				—				(325	)
		$	20,518			$	41,249			$	(123,409	)		$	(340,011	)
Liabilities
Liabilities of Consolidated CLO Vehicles (a)
Senior Secured Notes		$	—			$	—			$	—			$	199,445
Subordinated Notes			—				—				—				30,046
Corporate Treasury Commitments			—				(193	)			—				(2,030	)
		$	—			$	(193	)		$	—			$	227,461

 

(a)	During the year ended December 31, 2020, Blackstone deconsolidated nine CLO vehicles. See Note 9. “Variable Interest Entities” for additional details.

---

The following table presents information for those financial instruments for which the fair value option was elected:

 

		June 30, 2021												December 31, 2020
						For Financial Assets												For Financial Assets
						Past Due												Past Due
		(Deficiency)								Excess				(Deficiency)								Excess
		of Fair Value				Fair				of Fair Value				of Fair Value				Fair				of Fair Value
		Over Principal				Value				Over Principal				Over Principal				Value				Over Principal
Loans and Receivables		$	(2,569	)		$	—			$	—			$	(7,807	)		$	—			$	—
Debt Securities			(26,978	)			—				—				(29,359	)			—				—
		$	(29,547	)		$	—			$	—			$	(37,166	)		$	—			$	—

As of June 30, 2021 and December 31, 2020, no Loans and Receivables for which the fair value option was elected were past due or in non-accrual status.

---

8.   Fair Value Measurements of Financial Instruments

The following tables summarize the valuation of Blackstone’s financial assets and liabilities by the fair value hierarchy:

 

		June 30, 2021
		Level I				Level II				Level III				NAV				Total
Assets
Cash and Cash Equivalents		$	398,672			$	—			$	—			$	—			$	398,672
Investments
Investments of Consolidated Blackstone Funds
Investment Funds			—				—				—				299,596				299,596
Equity Securities, Partnerships and LLC Interests			35,247				163,841				923,618				—				1,122,706
Debt Instruments			670				386,574				59,366				—				446,610
Freestanding Derivatives			—				2,357				—				—				2,357
Total Investments of Consolidated Blackstone Funds			35,917				552,772				982,984				299,596				1,871,269
Corporate Treasury Investments			510,186				1,894,540				35,396				203				2,440,325
Other Investments			503,932				116,250				48,862				51,755				720,799
Total Investments			1,050,035				2,563,562				1,067,242				351,554				5,032,393
Accounts Receivable - Loans and Receivables			—				—				223,796				—				223,796
Other Assets - Freestanding Derivatives			505				105,005				—				—				105,510
		$	1,449,212			$	2,668,567			$	1,291,038			$	351,554			$	5,760,371
Liabilities
Securities Sold, Not Yet Purchased		$	11,953			$	23,830			$	—			$	—			$	35,783
Accounts Payable, Accrued Expenses and Other Liabilities
Consolidated Blackstone Funds - Freestanding Derivatives			—				2,259				—				—				2,259
Freestanding Derivatives			1,086				145,948				—				—				147,034
Corporate Treasury Commitments (a)			—				—				447				—				447
Total Accounts Payable, Accrued Expenses and Other Liabilities			1,086				148,207				447				—				149,740
		$	13,039			$	172,037			$	447			$	—			$	185,523

---

 

		December 31, 2020
		Level I				Level II				Level III				NAV				Total
Assets
Cash and Cash Equivalents		$	597,130			$	15,606			$	—			$	—			$	612,736
Investments
Investments of Consolidated Blackstone Funds
Investment Funds			—				—				—				15,711				15,711
Equity Securities, Partnerships and LLC Interests			39,694				48,471				792,958				—				881,123
Debt Instruments			—				492,280				65,352				—				557,632
Freestanding Derivatives			—				542				—				—				542
Total Investments of Consolidated Blackstone Funds			39,694				541,293				858,310				15,711				1,455,008
Corporate Treasury Investments			996,516				1,517,809				7,899				57,492				2,579,716
Other Investments			187,089				—				61,053				4,762				252,904
Total Investments			1,223,299				2,059,102				927,262				77,965				4,287,628
Accounts Receivable - Loans and Receivables			—				—				581,079				—				581,079
Other Assets - Freestanding Derivatives			162				125,860				—				—				126,022
		$	1,820,591			$	2,200,568			$	1,508,341			$	77,965			$	5,607,465
Liabilities
Securities Sold, Not Yet Purchased		$	9,324			$	41,709			$	—			$	—			$	51,033
Accounts Payable, Accrued Expenses and Other Liabilities
Consolidated Blackstone Funds - Freestanding Derivatives			—				7,819				—				—				7,819
Freestanding Derivatives			373				195,260				—				—				195,633
Corporate Treasury Commitments (a)			—				—				244				—				244
Total Accounts Payable, Accrued Expenses and Other Liabilities			373				203,079				244				—				203,696
		$	9,697			$	244,788			$	244			$	—			$	254,729

 

LLC Limited Liability Company.

(a)	Corporate Treasury Commitments are measured using third party pricing.

 

---

The following table summarizes the quantitative inputs and assumptions used for items categorized in Level III of the fair value hierarchy as of June 30, 2021:

 

Fair Value

Valuation Techniques

Unobservable Inputs

Ranges

Weighted- Average (a)

Impact to Valuation from an Increase in Input

Financial Assets

Investments of Consolidated Blackstone Funds

Equity Securities, Partnership   and LLC Interests

$

923,618

Discounted Cash Flows

Discount Rate

2.8%  -   43.8 %

10.4 %

Lower

Exit Multiple - EBITDA

3.7x  - 27.0x

12.8 x

Higher

Exit Capitalization Rate

1.7 % - 14.9 %

5.2 %

Lower

Transaction Price

n/a

Debt Instruments

59,366

Discounted Cash Flows

Discount Rate

6.6 % -19.3 %

9.7 %

Lower

Third Party Pricing

n/a

Total Investments of Consolidated Blackstone Funds

982,984

Corporate Treasury Investments

35,396

Discounted Cash Flows

Discount Rate

5.6 % - 8.1 %

6.5 %

Lower

Third Party Pricing

n/a

Transaction Price

n/a

Loans and Receivables

223,796

Discounted Cash Flows

Discount Rate

6.6 % - 8.3 %

7.4 %

Lower

Other Investments

48,862

Third Party Pricing

n/a

Transaction Price

n/a

$

1,291,038

---

The following table summarizes the quantitative inputs and assumptions used for items categorized in Level III of the fair value hierarchy as of December 31, 2020:

 

Fair Value

Valuation Techniques

Unobservable Inputs

Ranges

Weighted- Average (a)

Impact to Valuation from an Increase in Input

Financial Assets

Investments of Consolidated Blackstone Funds

Equity Securities, Partnership   and LLC Interests

$

792,958

Discounted Cash Flows

Discount Rate

3.8 % - 42.1 %

10.8 %

Lower

Exit Multiple - EBITDA

1.7 x - 24.0 x

13.2 x

Higher

Exit Capitalization Rate

2.7 % - 14.9 %

5.4 %

Lower

Transaction Price

n/a

Other

n/a

Debt Instruments

65,352

Discounted Cash Flows

Discount Rate

6.3 % - 19.3 %

8.6 %

Lower

Third Party Pricing

n/a

Total Investments of Consolidated Blackstone Funds

858,310

Corporate Treasury Investments

7,899

Discounted Cash Flows

Discount Rate

3.3 % - 7.4 %

6.4 %

Lower

Third Party Pricing

n/a

Loans and Receivables

581,079

Discounted Cash Flows

Discount Rate

6.7 % - 10.3 %

7.8 %

Lower

Other Investments

61,053

Third Party Pricing

n/a

Transaction Price

n/a

Other

n/a

$

1,508,341

 

n/a		Not applicable.
EBITDA		Earnings before interest, taxes, depreciation and amortization.
Exit Multiple		Ranges include the last twelve months EBITDA and forward EBITDA multiples.
Third Party Pricing		Third Party Pricing is generally determined on the basis of unadjusted prices between market participants provided by reputable dealers or pricing services.
Transaction Price		Includes recent acquisitions or transactions.
(a)		Unobservable inputs were weighted based on the fair value of the investments included in the range.

Since December 31, 2020, there have been no changes in valuation techniques within Level II and Level III that have had a material impact on the valuation of financial instruments.

The following tables summarize the changes in financial assets and liabilities measured at fair value for which Blackstone has used Level III inputs to determine fair value and does not include gains or losses that were reported in Level III in prior years or for instruments that were transferred out of Level III prior to the end of the respective reporting period. These tables also exclude financial assets and liabilities measured at fair value on a non-recurring basis. Total r

e

alized and unrealized gains and losses recorded for Level III investments are reported in either Investment Income (Loss) or Net Gains from Fund Investment Activities in the Condensed Consolidated Statements of Operations.

---

		Level III Financial Assets at Fair Value
		Three Months Ended June 30,
		2021																2020
		Investments																Investments
		of				Loans				Other								of				Loans				Other
		Consolidated				and				Investments								Consolidated				and				Investments
		Funds				Receivables				(a)				Total				Funds				Receivables				(a)				Total
Balance, Beginning of Period		$	885,228			$	604,611			$	41,160			$	1,530,999			$	1,014,098			$	218,115			$	47,909			$	1,280,122
Transfer Into Level III (b)			1,266				—				—				1,266				316,551				—				8,402				324,953
Transfer Out of Level III (b)			(12,187	)			—				—				(12,187	)			(200,964	)			—				(16,850	)			(217,814	)
Purchases			99,223				33,434				33,458				166,115				125,218				7,160				4,559				136,937
Sales			(79,993	)			(408,488	)			(1,014	)			(489,495	)			(51,971	)			(75,689	)			(7,626	)			(135,286	)
Issuances			—				12,594				—				12,594				—				—				—				—
Settlements			—				(28,155	)			—				(28,155	)			—				(1,637	)			—				(1,637	)
Changes in Gains (Losses) Included in Earnings			89,447				9,800				(129	)			99,118				12,442				14,419				(2,697	)			24,164
Balance, End of Period		$	982,984			$	223,796			$	73,475			$	1,280,255			$	1,215,374			$	162,368			$	33,697			$	1,411,439
Changes in Unrealized Gains (Losses) Included in Earnings Related to Financial Assets Still Held at the Reporting Date		$	68,862			$	746			$	(128	)		$	69,480			$	(27,616	)		$	9,521			$	(7,782	)		$	(25,877	)

 

		Level III Financial Assets at Fair Value
		Six Months Ended June 30,
		2021																2020
		Investments																Investments
		of				Loans				Other								of				Loans				Other
		Consolidated				and				Investments								Consolidated				and				Investments
		Funds				Receivables				(a)				Total				Funds				Receivables				(a)				Total
Balance, Beginning of Period		$	858,310			$	581,079			$	46,158			$	1,485,547			$	1,050,272			$	500,751			$	29,289			$	1,580,312
Transfer Into Level III (b)			1,804				—				—				1,804				282,400				—				25,001				307,401
Transfer Out of Level III (b)			(88,841	)			—				—				(88,841	)			(147,510	)			—				(18,875	)			(166,385	)
Purchases			186,080				356,763				33,459				576,302				226,824				170,899				5,771				403,494
Sales			(127,985	)			(701,212	)			(6,163	)			(835,360	)			(111,580	)			(506,881	)			(12,665	)			(631,126	)
Issuances			—				19,340				—				19,340				—				—				—				—
Settlements			—				(45,555	)			—				(45,555	)			—				(3,650	)			—				(3,650	)
Changes in Gains (Losses) Included in Earnings			153,616				13,381				21				167,018				(85,032	)			1,249				5,176				(78,607	)
Balance, End of Period		$	982,984			$	223,796			$	73,475			$	1,280,255			$	1,215,374			$	162,368			$	33,697			$	1,411,439
Changes in Unrealized Gains (Losses) Included in Earnings Related to Financial Assets Still Held at the Reporting Date		$	125,918			$	(3,110	)		$	(71	)		$	122,737			$	(97,403	)		$	4,940			$	(123	)		$	(92,586	)

 

(a)	Represents corporate treasury investments and Other Investments.

(b)	Transfers in and out of Level III financial assets and liabilities were due to changes in the observability of inputs used in the valuation of such assets and liabilities.

9.    Variable Interest Entities

Pursuant to GAAP consolidation guidance, Blackstone consolidates certain VIEs for which it is

t

he pr

i

mary beneficiary either directly or indirectly, through a consolidated entity or affiliate. VIEs include certain private equity, real estate, credit-focused or funds of hedge funds entities and CLO vehicles. The purpose of such VIEs is to provide strategy specific investment opportunities for investors in exchange for management and performance-based fees. The investment strategies of the Blackstone Funds differ

b

y product; however, the fundamental risks of the Blackstone Funds are similar, including loss of invested capital and loss of management fees and performance-

 

---

based fees. In Blackstone’s role as general partner, collateral manager or investment adviser, it generally considers itself the sponsor of the applicable Blackstone Fund. Blackstone does not provide performance guarantees and has no other financial obligation to provide funding to consolidated VIEs other than its own capital commitments.

The assets of consolidated variable interest entities may only be used to settle obligations of these entities. In addition, there is no recourse to Blackstone for the consolidated VIEs’ liabilities.

During the year ended December 31, 2020, Blackstone determined that it was no longer the pr

i

mary beneficiary and deconsolidated nine CLO vehicles as a result of an ownership reorganization and the ongoing decline in Blackstone’s economic exposure to these vehicles. Following the ownership reorganization, there are no remaining consolidated CLO vehicles. As of the date of deconsolidation, Blackstone’s Total Assets, Total Liabilities and Non-Controlling Interests in Consolidated Entities were reduced by $6.8 billion, $6.6 billion and $216.3 million, respectively. Blackstone will continue to receive management fees and Performance Allocations from these vehicles following the dilution of its ownership interests.

Blackstone holds variable interests in certain VIEs which are not consolidated as it is determined that Blackstone is not the primary beneficiary. Blackstone’s involvement with such entities is in the form of direct and indirect equity interests and fee arrangements. The maximum exposure to loss represents the loss of assets recognized by Blackstone relating to non-consolidated VIEs and any clawback obligation relating to previously distributed Performance Allocations. Blackstone’s maximum exposure to loss relating to non-consolidated VIEs were as follows:

 

		June 30,				December 31,
		2021				2020
Investments		$	1,988,177			$	1,307,292
Due from Affiliates			416,699				262,815
Potential Clawback Obligation			43,529				38,679
Maximum Exposure to Loss		$	2,448,405			$	1,608,786
Amounts Due to Non-Consolidated VIEs		$	209			$	241

10. Repurchase Agreements

At June 30, 2021 and December 31, 2020, Blackstone pledged securities with a carrying value of $80.0 million and $110.8 million, respectively, and cash to collateralize its repurchase agreements. Such securities can be repledged, delivered or otherwise used by the counterparty.

The following tables provide information regarding Blackstone’s Repurchase Agreements obligation by type of collateral pledged:

 

		June 30, 2021
		Remaining Contractual Maturity of the Agreements
		Overnight												Greater
		and				Up to				30 - 90				than
		Continuous				30 Days				Days				90 days				Total
Repurchase Agreements
Asset-Backed Securities		$	—			$	—			$	25,121			$	32,126			$	57,247
Gross Amount of Recognized Liabilities for Repurchase Agreements in Note 11. “Offsetting of Assets and Liabilities”																		$	57,247
Amounts Related to Agreements Not Included in Offsetting Disclosure in Note 11. “Offsetting of Assets and Liabilities”																		$	—

 

---

 

		December 31, 2020
		Remaining Contractual Maturity of the Agreements
		Overnight												Greater
		and				Up to				30 - 90				than
		Continuous				30 Days				Days				90 days				Total
Repurchase Agreements
Asset-Backed Securities		$	—			$	15,345			$	32,759			$	28,704			$	76,808
Gross Amount of Recognized Liabilities for Repurchase Agreements in Note 11. “Offsetting of Assets and Liabilities”																		$	76,808
Amounts Related to Agreements Not Included in Offsetting Disclosure in Note 11. “Offsetting of Assets and Liabilities”																		$	—

11. Offsetting of Assets and Liabilities

The following tables present the offsetting of assets and liabilities as of June 30, 2021 and December 31, 2020:

 

June 30, 2021

Gross and Net

Amounts of

Gross Amounts Not Offset

Assets Presented

in the Statement of

in the Statement

Financial Condition

of Financial

Financial

Cash Collateral

Condition

Instruments (a)

Received

Net Amount

Assets

Freestanding Derivatives

$

106,296

$

104,616

$

46

$

1,634

 

		June 30, 2021
		Gross and Net
		Amounts of
		Liabilities				Gross Amounts Not Offset
		Presented in the				in the Statement of
		Statement of				Financial Condition
		Financial				Financial				Cash Collateral
		Condition				Instruments (a)				Pledged				Net Amount
Liabilities
Freestanding Derivatives		$	149,293			$	129,569			$	13,857			$	5,867
Repurchase Agreements			57,247				57,247				—				—
		$	206,540			$	186,816			$	13,857			$	5,867

 

---

December 31, 2020

Gross and Net

Amounts of

Gross Amounts Not Offset

Assets Presented

in the Statement of

in the Statement

Financial Condition

of Financial

Financial

Cash Collateral

Condition

Instruments (a)

Received

Net Amount

Assets

Freestanding Derivatives

$

126,564

$

114,673

$

53

$

11,838

 

		December 31, 2020
		Gross and Net
		Amounts of
		Liabilities				Gross Amounts Not Offset
		Presented in the				in the Statement of
		Statement of				Financial Condition
		Financial				Financial				Cash Collateral
		Condition				Instruments (a)				Pledged				Net Amount
Liabilities
Freestanding Derivatives		$	202,188			$	174,623			$	19,194			$	8,371
Repurchase Agreements			76,808				76,808				—				—
		$	278,996			$	251,431			$	19,194			$	8,371

 

(a)	Amounts presented are inclusive of both legally enforceable master netting agreements, and financial instruments received or pledged as collateral. Financial instruments received or pledged as collateral offset derivative counterparty risk exposure, but do not reduce net balance sheet exposure.

Repurchase Agreements are presented separately on the Condensed Consolidated Statements of Financial Condition. Freestanding Derivative assets are included in Other Assets in the Condensed Consolidated Statements of Financial Condition. The following table presents the components of Other Assets:

 

		June 30,				December 31,
		2021				2020
Furniture, Equipment and Leasehold Improvements, Net		$	242,072			$	231,807
Prepaid Expenses			193,899				105,248
Freestanding Derivatives			105,510				126,022
Other			15,233				17,945
		$	556,714			$	481,022

Freestanding Derivative liabilities are included in Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition and are not a significant component thereof.

Notional Pooling Arrangement

Blackstone has a notional cash pooling arrangement with a financial institution for cash management purposes. This arrangement allows for cash withdrawals based upon aggregate cash balances on deposit at the same financial institution. Cash withdrawals cannot exceed aggregate cash balances on deposit. The net balance of cash on deposit and overdrafts is used as a basis for calculating net

---

interest expense or income. As of June 30, 2021, the aggregate cash balance on deposit relating to the cash pooling arrangement was $724.3 million, which was offset with an accompanying overdraft of $724.3 million.

12. Borrowings

On August 5, 2021, Blackstone, through its indirect subsidiary Blackstone Holdings Finance Co. L.L.C. (the “Issuer”), issued $650 million aggregate principal amount of senior notes due August 5, 2028 (the “2028 Notes”), $800 million aggregate principal amount of senior notes due January 30, 2032 (the “2032 Notes”) and $550 million aggregate principal amount of senior notes due August 5, 2051 (the “2051 Notes”). The 2028 Notes have an interest rate of 1.625% per annum, the 2032 Notes have an interest rate of 2.000% per annum and the 2051 Notes have an interest rate of 2.850% per annum, in each case accruing from August 5, 2021. Interest on the 2028 Notes and the 2051 Notes is payable semi-annually in arrears on February 5 and August 5 of each year commencing on February 5, 2022. Interest on the 2032 Notes is payable semi-annually in arrears on January 30 and July 30 of each year commencing on January 30, 2022.

All of Blackstone’s outstanding senior notes, including the 2028 Notes, 2032 Notes and 2051 Notes are unsecured and unsubordinated obligations of the Issuer that are fully and unconditionally guaranteed by The Blackstone Group Inc. and its indirect subsidiaries, Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P. (the “Guarantors”). The guarantees are unsecured and unsubordinated obligations of the Guarantors. Transaction costs related to the issuance of the 2028 Notes, 2032 Notes and 2051 Notes have been capitalized and will be amortized over the life of the 2028 Notes, 2032 Notes and 2051 Notes.

The following table presents the general characteristics of each of Blackstone’s outstanding notes as of June 30, 2021 and December 31, 2020, as well as their carrying value and fair value. The notes are included in Loans Payable within the Condensed Consolidated Statements of Financial Condition. All of the notes were issued at a discount. All of the notes accrue interest from the issue date thereof and all pay interest in arrears on a semi-annual basis or annual basis.

 

		June 30, 2021								December 31, 2020
		Carrying				Fair				Carrying				Fair
Senior Notes		Value				Value (a)				Value				Value (a)
4.750%, Due 2/15/2023		$	397,975			$	426,880			$	397,385			$	434,400
2.000%, Due 5/19/2025			384,722				383,630				362,947				398,620
1.000%, Due 10/5/2026			712,608				738,872				724,646				770,707
3.150%, Due 10/2/2027			297,561				324,720				297,387				332,370
1.500%, Due 4/10/2029			666,320				763,418				728,054				805,744
2.500%, Due 1/10/2030			491,201				517,500				490,745				538,200
1.600%, Due 3/30/2031			495,319				474,750				495,100				497,950
6.250%, Due 8/15/2042			238,789				364,025				238,668				372,250
5.000%, Due 6/15/2044			489,322				665,200				489,201				684,800
4.450%, Due 7/15/2045			344,346				432,495				344,282				449,645
4.000%, Due 10/2/2047			290,630				353,070				290,533				364,590
3.500%, Due 9/10/2049			392,007				440,760				391,925				460,120
2.800%, Due 9/30/2050			393,749				395,400				393,681				406,280
		$	5,594,549			$	6,280,720			$	5,644,554			$	6,515,676

 

 

(a)	Fair value is determined by broker quote and these notes would be classified as Level II within the fair value hierarchy.

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Scheduled principal payments for borrowings as of June 30, 2021 were as follows:

 

		Operating				Blackstone Fund				Total
		Borrowings				Facilities				Borrowings
2021		$	—			$	99			$	99
2022			—				—				—
2023			400,000				—				400,000
2024			—				—				—
2025			355,740				—				355,740
Thereafter			4,922,960				—				4,922,960
		$	5,678,700			$	99			$	5,678,799

13. Income Taxes

 

Prior to the Conversion, Blackstone and certain of its subsidiaries operated in the U.S. as partnerships for income tax purposes (partnerships generally are not subject to federal income taxes) and generally as corporate entities in non-U.S. jurisdictions. Subsequent to the Conversion, all income attributable to Blackstone is subject to U.S. corporate income taxes.

The Conversion resulted in a step-up in the tax basis of certain assets that will be recovered as those assets are sold or the basis is amortized.

Blackstone was a cash 

taxpayer for the three and six months ended June 30, 2021. Blackstone’s effective tax rate was

9.2

% and

9.8

% for the three months ended June 30, 2021 and 2020, respectively, and

4.4

% and

0.9

% for the six months ended June 30, 2021 and 2020, respectively. Blackstone’s income tax provision (benefit) was $

288.3

 million and $

147.4

 million for the three months ended June 30, 2021 and 2020, respectively, and $

287.8

 million and $

(11.3

) million for the six months ended June 30, 2021 and 2020, respectively. For the three and six months ended June 30, 2021, the effective tax rate differs from the statutory rate primarily because: (a) a portion of the reported net income (loss) before taxes is attributable to non-controlling interest holders and (b) of the net change to the valuation allowance related to the step-up in the tax basis of investment tax assets

.

 For the three and six months ended June 30, 2020, the effective tax rate differs from the statutory rate primarily because: (a) a portion of the reported net income (loss) before taxes is attributable to non-controlling interest holders and (b) of the net change to the valuation allowance related to the step-up in the tax basis of investment tax assets.

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14. Earnings Per Share and Stockholders’ Equity

Earnings Per Share

Basic and diluted net income per share of common stock for the three and six months ended June 30, 2021 and 2020 was calculated as follows:

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Net Income (Loss) for Per Share of Common Stock Calculations
Net Income (Loss) Attributable to The Blackstone Group Inc., Basic		$	1,309,152			$	568,266			$	3,057,024			$	(498,226	)
Incremental Net Income from Assumed Exchange of Blackstone Holdings Partnership Units			—				405,459				—				—
Net Income (Loss) Attributable to The Blackstone Group Inc., Diluted		$	1,309,152			$	973,725			$	3,057,024			$	(498,226	)
Shares/Units Outstanding
Weighted-Average Shares of Common Stock Outstanding, Basic			721,141,954				698,534,168				715,121,029				677,041,769
Weighted-Average Shares of Unvested Deferred Restricted Common Stock			123,226				123,340				501,179				—
Weighted-Average Blackstone Holdings Partnership Units			—				505,754,449				—				—
Weighted-Average Shares of Common Stock Outstanding, Diluted			721,265,180				1,204,411,957				715,622,208				677,041,769
Net Income (Loss) Per Share of Common Stock
Basic		$	1.82			$	0.81			$	4.27			$	(0.74	)
Diluted		$	1.82			$	0.81			$	4.27			$	(0.74	)
Dividends Declared Per Share of Common Stock (a)		$	0.82			$	0.39			$	1.78			$	1.00

 

(a)	Dividends declared reflects the calendar date of the declaration for each dividend.

In computing the dilutive effect that the exchange of Blackstone Holdings Partnership Units would have on Net Income Per Share of Common Stock, Blackstone considered that net income available to holders of shares of common stock would increase due to the elimination of non-controlling interests in Blackstone Holdings, inclusive of any tax impact. The hypothetical conversion may be dilutive to the extent there is activity at The Blackstone Group Inc. level that has not previously been attributed to the non-controlling interests or if there is a change in tax rate as a result of a hypothetical conversion.

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The following table summarizes the anti-dilutive securities for the three and six months ended June 30, 2021 and 2020:

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
Weighted-Average Shares of Unvested Deferred Restricted Common Stock			—				—				—				15,672,449
Weighted-Average Blackstone Holdings Partnership Units			488,569,471				—				490,857,143				508,487,300

Stockholders’ Equity

In connection with the Conversion, effective July 1, 2019, each common unit of the Partnership outstanding immediately prior to the Conversion converted into one issued and outstanding, fully paid and nonassessable share of Class A common stock, $0.00001 par value per share, of the Company. The special voting unit of the Partnership outstanding immediately prior to the Conversion converted into one issued and outstanding, fully paid and nonassessable share of Class B common stock, $0.00001 par value per share, of the Company. The general partner units of the Partnership outstanding immediately prior to the Conversion converted into one issued and outstanding, fully paid and nonassessable share of Class C common stock, $0.00001 par value per share, of the Company.

In connection with the share reclassification, effective February 26, 2021, the Certificate of Incorporation of The Blackstone Group Inc. was amended and restated to: (a) rename the Class A common stock as “common stock,” which has the same rights and powers (including, without limitation, with respect to voting) that Blackstone’s Class A common stock formerly had, (b) reclassify the “Class B common stock” into a new “Series I preferred stock,” which has the same rights and powers that the Class B common stock formerly had, and (c) reclassify the Class C common stock into a new “Series II preferred stock,” which has the same rights and powers that the Class C common stock formerly had. In connection with such share reclassification, the Company authorized 10 billion shares of preferred stock with a par value of $0.00001, of which (a) 999,999,000 shares are designated as Series I preferred stock and (b) 1,000 shares are designated as Series II preferred stock. The remaining 9 billion shares may be designated from time to time in accordance with Blackstone’s certificate of incorporation. There was 1 share of Series I preferred stock and 1 share of Series II preferred stock issued and outstanding as of June 30, 2021.

Under Blackstone’s certificate of incorporation and Delaware law, holders of Blackstone’s common stock are entitled to vote, together with holders of Blackstone’s Series I preferred stock, voting as a single class, on a number of significant matters, including certain sales, exchanges or other dispositions of all or substantially all of Blackstone’s assets, a merger, consolidation or other business combination, the removal of the Series II Preferred Stockholder and forced transfer by the Series II Preferred Stockholder of its shares of Series II preferred stock and the designation of a successor Series II Preferred Stockholder. The Series II Preferred Stockholder elects the Company’s directors. Holders of Blackstone’s Series I preferred stock and Series II preferred stock are not entitled to dividends from the Company, or receipt of any of the Company’s assets in the event of any dissolution, liquidation or winding up. Blackstone Partners L.L.C. is the sole holder of the Series I preferred stock and Blackstone Group Management L.L.C. is the sole holder of the

Series II preferred stock.

Share Repurchase Program

On May 6, 2021, Blackstone’s board of directors authorized the repurchase of up to $1.0 billion of common stock and Blackstone Holdings Partnership Units. Under the repurchase program, repurchases may be made from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual numbers repurchased will depend on a variety of factors, including legal requirements, price and economic and market conditions. The repurchase program may be changed, suspended or discontinued at any time and does not have a specified expiration date.

---

During the three and six months

 ended June 30, 2021, Blackstone repurchased 3.2 million shares of common stock at a total cost of $289.1 million. During the three and six months ended June 30, 2020, Blackstone repurchased 2.0 million and 7.0 million shares, respectively, of common stock at a total cost of $114.9 million and $368.4 million, respectively. As of June 30, 2021, the amount remaining available for repurchases under the repurchase program was $758.4 million.

Shares Eligible for Dividends and Distributions

As of June 30, 2021, the total shares of common stock and Blackstone Holdings Partnership Units entitled to participate in dividends and distributions were as follows:

 

		Shares/Units
Common Stock Outstanding			691,093,463
Unvested Participating Common Stock			29,381,076
Total Participating Common Stock			720,474,539
Participating Blackstone Holdings Partnership Units			487,276,882
			1,207,751,421

15.	Equity-Based Compensation

Blackstone has granted equity-based compensation awards to Blackstone’s senior managing directors, non-partner professionals, non-professionals and selected external advisers under Blackstone’s Amended and Restated 2007 Equity Incentive Plan (the “Equity Plan”). The Equity Plan allows for the granting of options, share appreciation rights or other share-based awards (shares, restricted shares, restricted shares of common stock, deferred restricted shares of common stock, phantom restricted shares of common stock or other share-based awards based in whole or in part on the fair value of shares of common stock or Blackstone Holdings Partnership Units) which may contain certain service or performance requirements. As of January 1, 2021, Blackstone had the ability to grant 171,130,080 shares under the Equity Plan.

For the three and six months ended June 30, 2021, Blackstone recorded compensation expense of $141.6 million and $305.4 million, respectively, in relation to its equity-based awards with corresponding tax benefits of $18.8 million and $40.7 million, respectively. For the three and six months ended June 30, 2020, Blackstone recorded compensation expense of $119.9 million and $238.7 million, respectively, in relation to its equity-based awards with corresponding tax benefits of $14.7 million and $28.4 million, respectively.

As of June 30, 2021, there was $1.4 billion of estimated unrecognized compensation expense related to unvested awards. This cost is expected to be recognized over a weighted-average period of 3.5 years.

Total vested and unvested outstanding shares, including common stock, Blackstone Holdings Partnership Units and deferred restricted shares of common stock, were 1,207,856,387 as of June 30, 2021. Total outstanding phantom shares were 92,051 as of June 30, 2021.

---

A summary of the status of Blackstone’s unvested equity-based awards as of June 30, 2021 and of changes during the period January 1, 2021 through June 30, 2021 is presented below:

 

		Blackstone Holdings								The Blackstone Group Inc.
										Equity Settled Awards								Cash Settled Awards
						Weighted-								Weighted-								Weighted-
						Average				Deferred				Average								Average
		Partnership				Grant Date				Restricted Shares				Grant Date				Phantom				Grant Date
Unvested Shares/Units		Units				Fair Value				of Common Stock				Fair Value				Shares				Fair Value
Balance, December 31, 2020			23,771,136			$	36.33				19,512,034			$	42.60				65,284			$	60.42
Granted			—				—				11,844,962				72.88				22,000				89.68
Vested			(1,590,073	)			36.19				(2,611,721	)			47.63				(1,211	)			69.96
Forfeited			(535,650	)			41.28				(390,170	)			46.08				—				—
Balance, June 30, 2021			21,645,413			$	36.50				28,355,105			$	54.75				86,073			$	92.42

Shares/Units Expected to Vest

The following unvested shares and units, after expected forfeitures, as of June 30, 2021, are expected to vest:

 

						Weighted-
						Average
						Service Period
		Shares/Units				in Years
Blackstone Holdings Partnership Units			19,772,774			2.3
Deferred Restricted Shares of Common Stock			24,434,747			3.5
Total Equity-Based Awards			44,207,521			3.0
Phantom Shares			70,356			2.9

16.	Related Party Transactions

A

ffiliate Receivables and Payables

Due from Affiliates and Due to Affiliates consisted of the following:

 

		June 30,				December 31,
		2021				2020
Due from Affiliates
Management Fees, Performance Revenues, Reimbursable Expenses and Other Receivables from Non-Consolidated Entities and Portfolio Companies		$	2,462,256			$	2,637,055
Due from Certain Non-Controlling Interest Holders and Blackstone Employees			661,193				548,897
Accrual for Potential Clawback of Previously Distributed Performance Allocations			36,380				35,563
		$	3,159,829			$	3,221,515

---

		June 30,				December 31,
		2021				2020
Due to Affiliates
Due to Certain Non-Controlling Interest Holders in Connection with the Tax Receivable Agreements		$	951,574			$	857,523
Due to Non-Consolidated Entities			149,924				107,410
Due to Certain Non-Controlling Interest Holders and Blackstone Employees			38,562				61,539
Accrual for Potential Repayment of Previously Received Performance Allocations			86,444				108,569
		$	1,226,504			$	1,135,041

Interests of the Founder, Senior Managing Directors, Employees and Other Related Parties

The Founder, senior managing directors, employees and certain other related parties invest on a discretionary basis in the consolidated Blackstone Funds both directly and through consolidated entities. These investments generally are subject to preferential management fee and performance allocation or incentive fee arrangements. As of June 30, 2021 and December 31, 2020, such investments aggregated $1.4 billion and $1.1 billion, respectively. Their share of the Net Income

 (

L

oss)

Attributable to Redeemable Non-Controlling and

Non-Controlling

Interests in Consolidated Entities aggregated

to

$116.2 million and $64.1 million for the three months ended June 30, 2021 and 2020, respectively, and $233.6 million and $(114.3) million for the six months ended June 30, 2021 and 2020, respectively.

Loans to Affiliates

Loans to affiliates consist of interest bearing advances to certain Blackstone individuals to finance their investments in certain Blackstone Funds. These loans earn interest at Blackstone’s cost of borrowing and such interest totaled $1.0 million and $1.1 million for the three months ended June 30, 2021 and 2020, respectively, and $3.3 million and $4.1 million for the six months ended June 30, 2021 and 2020, respectively.

Contingent Repayment Guarantee

Blackstone and its personnel who have received Performance Allocation distributions have guaranteed payment on a several basis (subject to a cap) to the carry funds of any clawback obligation with respect to the excess Performance Allocation allocated to the general partners of such funds and indirectly received thereby to the extent that either Blackstone or its personnel fails to fulfill its clawback obligation, if any. The Accrual for Potential Repayment of Previously Received Performance Allocations represents amounts previously paid to Blackstone Holdings and non-controlling interest holders that would need to be repaid to the Blackstone Funds if the carry funds were to be liquidated based on the fair value of their underlying investments as of June 30, 2021. See Note 17. “Commitments and Contingencies — Contingencies — Contingent Obligations (Clawback).”

Aircraft and Other Services 

In the normal course of business, Blackstone makes use of aircraft owned by Stephen A. Schwarzman; aircraft owned by Jonathan D. Gray; and aircraft owned jointly by Joseph P. Baratta and two other individuals (each such aircraft, “Personal Aircraft”). Each of Messrs. Schwarzman, Gray and Baratta paid for his respective ownership interest in his Personal Aircraft himself and bears his respective share of all operating, personnel and maintenance costs associated with the operation of such Personal Aircraft. The payments Blackstone makes for the use of the Personal Aircraft are based on current market rates.

In addition, on occasion, certain of Blackstone’s executive officers and employee directors and their families may make personal use of aircraft in which Blackstone owns a fractional interest, as well as other assets of Blackstone. Any such personal use of

 

---

Blackstone assets is charged to the executive officer or employee director based on market rates and usage. Personal use of Blackstone resources is also reimbursed to Blackstone based on market rates.

The transactions described herein are not material to the Condensed Consolidated Financial Statements.

Tax Receivable Agreements

Blackstone used a portion of the proceeds from the IPO and other sales of shares to purchase interests in the predecessor businesses from the predecessor owners. In addition, holders of Blackstone Holdings Partnership Units may exchange their Blackstone Holdings Partnership Units for shares of Blackstone common stock on a one-for-one basis. The purchase and subsequent exchanges are expected to result in increases in the tax basis of the tangible and intangible assets of Blackstone Holdings and therefore reduce the amount of tax that Blackstone would otherwise be required to pay in the future.

Blackstone has entered into tax receivable agreements with each of the predecessor owners and additional tax receivable agreements have been executed, and will continue to be executed, with newly-admitted senior managing directors and others who acquire Blackstone Holdings Partnership Units. The agreements provide for the payment by the corporate taxpayer to such owners of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the corporate taxpayers actually realize as a result of the aforementioned increases in tax basis and of certain other tax benefits related to entering into these tax receivable agreements. For purposes of the tax receivable agreements, cash savings in income tax will be computed by comparing the actual income tax liability of the corporate taxpayers to the amount of such taxes that the corporate taxpayers would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Blackstone Holdings as a result of the exchanges and had the corporate taxpayers not entered into the tax receivable agreements.

Assuming no future material changes in the relevant tax law and that the corporate taxpayers earn sufficient taxable income to realize the full tax benefit of the increased amortization of the assets, the expected future payments under the tax receivable agreements (which are taxable to the recipients) will aggregate $951.6 million over the next 15 years. The after-tax net present value of these estimated payments totals $261.5 million assuming a 15% discount rate and using Blackstone’s most recent projections relating to the estimated timing of the benefit to be received. Future payments under the tax receivable agreements in respect of subsequent exchanges would be in addition to these amounts. The payments under the tax receivable agreements are not conditioned upon continued ownership of Blackstone equity interests by the pre-IPO owners and the others mentioned above.

Amounts related to the deferred tax asset resulting from the increase in tax basis from the exchange of Blackstone Holdings Partnership Units to shares of Blackstone common stock, the resulting remeasurement of net deferred tax assets at the Blackstone ownership percentage at the balance sheet date, the due to affiliates for the future payments resulting from the tax receivable agreements and resulting adjustment to partners’ capital are included as Acquisition of Ownership Interests from Non-Controlling Interest Holders in the Supplemental Disclosure of Non-Cash Investing and Financing Activities in the Condensed Consolidated Statements of Cash Flows.

Other

Blackstone does business with and on behalf of some of its Portfolio Companies; all such arrangements are on a negotiated basis.

Additionally, please see Note 17. “Commitments and Contingencies — Contingencies — Guarantees” for information regarding guarantees provided to a lending institution for certain loans held by employees.

---

17.    Commitments and Contingencies

Commitments

Investment Commitments

Blackstone had $3.7 billion of investment commitments as of June 30, 2021 representing general partner capital funding commitments to the Blackstone Funds, limited partner capital funding to other funds and Blackstone principal investment commitments, including loan commitments. The consolidated Blackstone Funds had signed investment commitments of $293.0 million as of June 30, 2021, which includes $216.3 million of signed investment commitments for portfolio company acquisitions in the process of closing.

Contingencies

Guarantees

Certain of Blackstone’s consolidated real estate funds guarantee payments to third parties in connection with the ongoing business activities and/or acquisitions of their Portfolio Companies. There is no direct recourse to Blackstone to fulfill such obligations. To the extent that underlying funds are required to fulfill guarantee obligations, Blackstone’s invested capital in such funds is at risk. Total investments at risk in respect of guarantees extended by consolidated real estate funds was $16.7 million as of June 30, 2021.

The Blackstone Holdings Partnerships provided guarantees to a lending institution for certain loans held by employees either for investment in Blackstone Funds or for members’ capital contributions to The Blackstone Group International Partners LLP. The amount guaranteed as of June 30, 2021 was $216.3 million.

Litigation 

Blackstone may from time to time be involved in litigation and claims incidental to the conduct of its business. Blackstone’s businesses are also subject to extensive regulation, which may result in regulatory proceedings against Blackstone.

Blackstone accrues a liability for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. Although there can be no assurance of the outcome of such legal actions, based on information known by management, Blackstone does not have a potential liability related to any current legal proceeding or claim that would individually or in the aggregate materially affect its results of operations, financial position or cash flows.

In December 2017, a purported derivative suit (Mayberry v. KKR & Co., L.P., et al.) was filed in the Commonwealth of Kentucky Franklin County Circuit Court on behalf of the Kentucky Retirement System (“KRS”) by eight of its members and beneficiaries (the “Mayberry Plaintiffs”) alleging various breaches of fiduciary duty and other violations of Kentucky state law in connection with KRS’s investment in three hedge funds of funds, including a fund managed by Blackstone Alternative Asset Management L.P. (“BAAM L.P.”). The suit named more than 30 defendants, including The Blackstone Group L.P.; BAAM L.P.; Stephen A. Schwarzman, as Chairman and CEO of Blackstone; and J. Tomilson Hill, as then-Vice Chairman of Blackstone and CEO of BAAM L.P. (collectively, the “Blackstone Defendants”). Aside from the Blackstone Defendants, the action also named current and former KRS trustees and former KRS officers and various other service providers to KRS and their related persons.

The Mayberry Plaintiffs filed an amended complaint in January 2018. In November 2018, the Circuit Court granted one defendant’s motion to dismiss and denied all other defendants’ motions to dismiss, including those of the Blackstone Defendants. In January 2019, certain defendants, including the Blackstone Defendants, filed petitions in the Kentucky Court of Appeals for a writ of prohibition against the ongoing Mayberry proceedings on the ground that the Mayberry Plaintiffs lack standing. Certain KRS trustee

---

and officer defendants also noticed appeals from the Circuit Court’s denial of the motions to dismiss, which were transferred to the Kentucky Supreme Court.

 

On April 23, 2019, the Kentucky Court of Appeals granted the Blackstone Defendants’ petition for a writ of prohibition and vacated the Circuit Court’s November 30, 2018 Opinion and Order denying the motion to dismiss for lack of standing. On April 24, 2019, the Mayberry Plaintiffs filed a notice of appeal of that order to the Kentucky Supreme Court.

On July 9, 2020, the Kentucky Supreme Court unanimously held that the Mayberry Plaintiffs lack constitutional standing to bring their claims and remanded the case to the Circuit Court with direction to dismiss the complaint. On July 20, 2020, the Kentucky Attorney General filed a motion to intervene and a proposed intervening complaint in the Mayberry action on behalf of the Commonwealth of Kentucky. The Blackstone Defendants filed an objection to that motion on July 30, 2020. On July 21, 2020, the Kentucky Attorney General also filed a separate action in Franklin County Circuit Court that is nearly identical to its proposed intervening complaint.

In addition, on July 29, 2020, counsel for certain of the Mayberry Plaintiffs filed a motion for leave to amend their complaint. On December 28, 2020, the Circuit Court dismissed the Mayberry Plaintiffs’ complaint for lack of standing, denied the Mayberry Plaintiffs’ motion for leave to amend, and granted the Kentucky Attorney General’s motion to intervene. On May 24, 2021, the Attorney General filed its first amended complaint, which generally asserts the same allegations and claims as the Attorney General’s proposed intervening complaint and the Mayberry Plaintiffs’ original complaint. On July 30, 2021, the Blackstone Defendants filed a motion to dismiss the first amended complaint.

On December 31, 2020, three potentially new derivative plaintiffs brought a motion in the Circuit Court for leave to file a third amended complaint. The new derivative plaintiffs alleged they had standing and sought to press the Mayberry Plaintiffs’ case. The Circuit Court ordered the three potentially new derivative plaintiffs to file a motion to intervene, which they filed on February 1, 2021. On March 2, 2021, the Blackstone Defendants, certain other defendants, the Kentucky Attorney General, and KRS filed responses opposing the motion to intervene. On June 14, 2021, the Circuit Court denied the motion to intervene.

On January 6, 2021, the same three potentially new derivative plaintiffs also filed a separate derivative action that is substantially the same as the amended complaint they had sought to file in the original derivative action. On July 9, 2021, these same plaintiffs filed their first amended complaint. The first amended complaint is not styled as a derivative complaint, but rather as a purported “class” complaint brought on behalf of all KRS beneficiaries in KRS’s “Tier 3” pension plan. Defendants’ deadline to respond to the first amended complaint is September 20, 2021. On July 19, 2021, the Blackstone Defendants and other defendants removed this purported class action to federal court in the United States District Court for the Eastern District of Kentucky. On August 3, 2021, the plaintiffs moved to remand the lawsuit back to state court. Defendants’ opposition to the motion to remand is due August 23, 2021.

On April 28, 2021, the Kentucky Attorney General filed a declaratory judgment action in Franklin County Circuit Court on behalf of the Commonwealth of Kentucky. The Attorney General’s complaint alleges that certain provisions in the subscription agreements between KRS and the managers of the three funds at issue in the Mayberry action violate the Kentucky Constitution. The Attorney General’s suit names as defendants BAAM L.P., Blackstone, and five other defendants also named in the Mayberry action. On July 12, 2021, BAAM L.P. and Blackstone filed their answer to the complaint. On July 28, 2021, BAAM L.P. filed a motion for judgment on the pleadings, or in the alternative, for summary judgment seeking dismissal of the action and arguing the relevant contractual provisions are enforceable under the Kentucky Constitution. Also on July 28, 2021, Blackstone filed a motion for judgment on the pleadings seeking dismissal on the basis that Blackstone was not a party to the relevant agreements and is not subject to jurisdiction in Kentucky for this action.

Blackstone continues to believe that these suits are totally without merit and intends to defend them vigorously.

Finally, on July 30, 2021, BAAM L.P. filed a complaint in the Franklin Circuit Court in Kentucky asserting claims for breach of contract against Kentucky Public Pensions Authority (the administrative board overseeing KRS pension systems following a restructuring on April 1, 2021), Board of Trustees of KRS, Board of Trustees of the County Employees Retirement System, KRS Insurance Fund, and KRS Pension Fund, based on KRS’s breach of its representations in its subscription agreements with BAAM L.P.

---

The complaint alleges that KRS’s support and prosecution of the Mayberry action and the Kentucky Attorney General’s declaratory judgment action breaches the parties’ subscription agreements governing KRS’s investment with BAAM L.P and seeks damages flowing from that breach, including legal fees and expenses incurred in defending against the Mayberry and declaratory judgment actions. The KRS defendants’ response to the complaint is currently due September 8, 2021.

Contingent Obligations (Clawback)

Performance Allocations are subject to clawback to the extent that the Performance Allocations received to date with respect to a fund exceeds the amount due to Blackstone based on cumulative results of that fund. The actual clawback liability, however, generally does not become realized until the end of a fund’s life except for certain Blackstone real estate funds, multi-asset class investment funds and credit-focused funds, which may have an interim clawback liability. The lives of the carry funds, including available contemplated extensions, for which a liability for potential clawback obligations has been recorded for financial reporting purposes, are currently anticipated to expire at various points through 2028. Further extensions of such terms may be implemented under given circumstances.

For financial reporting purposes, when applicable, the general partners record a liability for potential clawback obligations to the limited partners of some of the carry funds due to changes in the unrealized value of a fund’s remaining investments and where the fund’s general partner has previously received Performance Allocation distributions with respect to such fund’s realized investments.

The following table presents the clawback obligations by segment:

 

		June 30, 2021												December 31, 2020
						Current and												Current and
		Blackstone				Former								Blackstone				Former
Segment		Holdings				Personnel (a)				Total (b)				Holdings				Personnel (a)				Total (b)
Real Estate		$	30,689			$	18,596			$	49,285			$	28,283			$	17,102			$	45,385
Private Equity			5,544				2,006				7,550				41,722				(8,623	)			33,099
Credit & Insurance			13,831				15,778				29,609				13,935				16,150				30,085
		$	50,064			$	36,380			$	86,444			$	83,940			$	24,629			$	108,569

 

(a)	The split of clawback between Blackstone Holdings and Current and Former Personnel is based on the performance of individual investments held by a fund rather than on a fund by fund basis.

(b)	Total is a component of Due to Affiliates. See Note 16. “Related Party Transactions — Affiliate Receivables and Payables — Due to Affiliates.”

For Private Equity, Real Estate, and certain Credit & Insurance Funds, a portion of the Performance Allocations paid to current and former Blackstone personnel is held in segregated accounts in the event of a cash clawback obligation. These segregated accounts are not included in the Condensed Consolidated Financial Statements of Blackstone, except to the extent a portion of the assets held in the segregated accounts may be allocated to a consolidated Blackstone fund of hedge funds. At June 30, 2021, $856.4 million was held in segregated accounts for the purpose of meeting any clawback obligations of current and former personnel if such payments are required.

In the Credit & Insurance segment, payment of Performance Allocations to Blackstone by the majority of the stressed/distressed, mezzanine and credit alpha strategies funds are substantially deferred under the terms of the partnership agreements. This deferral mitigates the need to hold funds in segregated accounts in the event of a cash clawback obligation.

If, at June 30, 2021, all of the investments held by Blackstone’s carry funds were deemed worthless, a possibility that management views as remote, the amount of Performance Allocations subject to potential clawback would be $3.6 billion, on an

after-tax

basis where applicable, of which Blackstone Holdings is potentially liable for $3.4 billion if current and former Blackstone personnel default on their share of the liability, a possibility that management also views as remote.

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18.    Segment Reporting

Blackstone transacts its primary business in the United States and substantially all of its revenues are generated domestically.

Blackstone conducts its alternative asset management businesses through four segments:

 

•

Real Estate – Blackstone’s Real Estate segment primarily comprises its management of global, Europe and Asia-focused opportunistic real estate funds, high-yield and high-grade real estate debt funds, liquid real estate debt funds, North America, Europe, Asia and life science-focused Core+ real estate funds, which also include a non-listed REIT, and a NYSE-listed REIT.

•

Private Equity – Blackstone’s Private Equity segment includes its management of flagship corporate private equity funds, sector and geographically-focused corporate private equity funds, including energy and Asia-focused funds, core private equity funds, an opportunistic investment platform, a secondary fund of funds business, infrastructure-focused funds, a life sciences private investment platform, a growth equity investment platform, a multi-asset investment program for eligible high net worth investors and a capital markets services business.

 

•

Hedge Fund Solutions – The largest component of Blackstone’s Hedge Fund Solutions segment is Blackstone Alternative Asset Management, which manages a broad range of commingled and customized hedge fund of fund solutions. The segment also includes investment platforms that seed new hedge fund businesses, purchase minority interests in more established general partners and management companies of funds, invest in special situation opportunities, create alternative solutions through daily liquidity products and invest directly.

 

•

Credit & Insurance – Blackstone’s Credit & Insurance segment consists principally of Blackstone Credit, which is organized into two overarching strategies: private credit (which includes mezzanine lending funds, middle market direct lending funds, including Blackstone’s business development companies, structured products group, stressed/distressed strategies and energy strategies) and liquid credit (which consists of CLOs, closed-ended funds, open-ended funds and separately managed accounts). In addition, the segment includes a publicly traded master limited partnership investment platform, Harvest, and Blackstone’s insurer-focused platform, Blackstone Insurance Solutions.

These business segments are differentiated by their various investment strategies. The Real Estate, Private Equity, Hedge Fund Solutions and Credit & Insurance segments primarily earn their income from management fees and investment returns on assets under management.

Segment Distributable Earnings is Blackstone’s segment profitability measure used to make operating decisions and assess performance across Blackstone’s four segments. Segment Distributable Earnings represents the net realized earnings of Blackstone’s segments and is the sum of Fee Related Earnings and Net Realizations for each segment. Blackstone’s segments are presented on a basis that deconsolidates Blackstone Funds, eliminates non-controlling ownership interests in Blackstone’s consolidated operating partnerships, removes the amortization of intangible assets and removes Transaction-Related Charges. Transaction-Related Charges arise from corporate actions including acquisitions, divestitures and Blackstone’s initial public offering. They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs and any gains or losses associated with these corporate actions.

For segment reporting purposes, Segment Distributable Earnings is presented along with its major components, Fee Related Earnings and Net Realizations. Fee Related Earnings is used to assess Blackstone’s ability to generate profits from revenues that are measured and received on a recurring basis and not subject to future realization events. Net Realizations is the sum of Realized Principal Investment Income and Realized Performance Revenues less Realized Performance Compensation. Performance Allocations and Incentive Fees are presented together and referred to collectively as Performance Revenues or Performance Compensation.

---

Segment Presentation

The following tables present the financial data for Blackstone’s four segments for the three months ended June 30, 2021 and 2020:

 

		Three Months Ended June 30, 2021
		Real				Private				Hedge Fund				Credit &				Total
		Estate				Equity				Solutions				Insurance				Segments
Management and Advisory Fees, Net
Base Management Fees		$	453,664			$	364,606			$	155,244			$	166,537			$	1,140,051
Transaction, Advisory and Other Fees, Net			38,080				32,272				1,558				6,215				78,125
Management Fee Offsets			(493	)			(3,601	)			(203	)			(1,137	)			(5,434	)
Total Management and Advisory Fees, Net			491,251				393,277				156,599				171,615				1,212,742
Fee Related Performance Revenues			33,776				—				—				15,113				48,889
Fee Related Compensation			(121,957	)			(136,767	)			(38,638	)			(78,023	)			(375,385	)
Other Operating Expenses			(54,760	)			(61,041	)			(21,873	)			(44,504	)			(182,178	)
Fee Related Earnings			348,310				195,469				96,088				64,201				704,068
Realized Performance Revenues			351,053				383,010				17,056				41,819				792,938
Realized Performance Compensation			(154,928	)			(159,375	)			(5,626	)			(18,342	)			(338,271	)
Realized Principal Investment Income			28,129				27,796				2,125				5,082				63,132
Total Net Realizations			224,254				251,431				13,555				28,559				517,799
Total Segment Distributable Earnings		$	572,564			$	446,900			$	109,643			$	92,760			$	1,221,867

		Three Months Ended June 30, 2020
		Real				Private				Hedge Fund				Credit &				Total
		Estate				Equity				Solutions				Insurance				Segments
Management and Advisory Fees, Net
Base Management Fees		$	382,704			$	268,070			$	145,455			$	145,565			$	941,794
Transaction, Advisory and Other Fees, Net			32,039				9,521				859				5,873				48,292
Management Fee Offsets			(2,436	)			(8,031	)			4				(2,890	)			(13,353	)
Total Management and Advisory Fees, Net			412,307				269,560				146,318				148,548				976,733
Fee Related Performance Revenues			6,505				—				—				8,528				15,033
Fee Related Compensation			(116,640	)			(92,825	)			(40,353	)			(57,086	)			(306,904	)
Other Operating Expenses			(44,525	)			(44,827	)			(17,807	)			(36,424	)			(143,583	)
Fee Related Earnings			257,647				131,908				88,158				63,566				541,279
Realized Performance Revenues			34,209				64,513				1,482				1,973				102,177
Realized Performance Compensation			(12,547	)			(25,016	)			—				(224	)			(37,787	)
Realized Principal Investment Income (Loss)			1,573				17,416				(331	)			280				18,938
Total Net Realizations			23,235				56,913				1,151				2,029				83,328
Total Segment Distributable Earnings		$	280,882			$	188,821			$	89,309			$	65,595			$	624,607

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The following tables present the financial data for Blackstone’s four segments as of June 30, 2021 and for the six months ended June 30, 2021 and 2020:

 

		June 30, 2021 and the Six Months Then Ended
		Real				Private				Hedge Fund				Credit &				Total
		Estate				Equity				Solutions				Insurance				Segments
Management and Advisory Fees, Net
Base Management Fees		$	880,850			$	742,266			$	305,777			$	328,448			$	2,257,341
Transaction, Advisory and Other Fees, Net			64,099				74,979				5,904				11,783				156,765
Management Fee Offsets			(2,116	)			(17,520	)			(261	)			(3,262	)			(23,159	)
Total Management and Advisory Fees, Net			942,833				799,725				311,420				336,969				2,390,947
Fee Related Performance Revenues			189,168				—				—				28,889				218,057
Fee Related Compensation			(310,449	)			(277,364	)			(77,488	)			(155,194	)			(820,495	)
Other Operating Expenses			(99,122	)			(112,096	)			(41,045	)			(91,339	)			(343,602	)
Fee Related Earnings			722,430				410,265				192,887				119,325				1,444,907
Realized Performance Revenues			439,691				638,855				48,629				67,086				1,194,261
Realized Performance Compensation			(177,690	)			(270,584	)			(12,534	)			(28,387	)			(489,195	)
Realized Principal Investment Income			128,949				143,199				37,675				51,465				361,288
Total Net Realizations			390,950				511,470				73,770				90,164				1,066,354
Total Segment Distributable Earnings		$	1,113,380			$	921,735			$	266,657			$	209,489			$	2,511,261
Segment Assets		$	11,049,049			$	14,178,326			$	2,803,086			$	3,754,874			$	31,785,335

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		Six Months Ended June 30, 2020
		Real				Private				Hedge Fund				Credit &				Total
		Estate				Equity				Solutions				Insurance				Segments
Management and Advisory Fees, Net
Base Management Fees		$	754,142			$	522,044			$	285,111			$	290,893			$	1,852,190
Transaction, Advisory and Other Fees, Net			55,063				30,934				1,617				11,343				98,957
Management Fee Offsets			(10,777	)			(17,246	)			(38	)			(5,786	)			(33,847	)
Total Management and Advisory Fees, Net			798,428				535,732				286,690				296,450				1,917,300
Fee Related Performance Revenues			11,056				—				—				16,443				27,499
Fee Related Compensation			(236,936	)			(203,193	)			(86,544	)			(126,495	)			(653,168	)
Other Operating Expenses			(85,001	)			(85,828	)			(36,474	)			(75,165	)			(282,468	)
Fee Related Earnings			487,547				246,711				163,672				111,233				1,009,163
Realized Performance Revenues			77,929				176,589				3,249				11,643				269,410
Realized Performance Compensation			(25,939	)			(79,659	)			(945	)			(2,546	)			(109,089	)
Realized Principal Investment Income Income (Loss)			8,873				27,763				(940	)			3,532				39,228
Total Net Realizations			60,863				124,693				1,364				12,629				199,549
Total Segment Distributable Earnings		$	548,410			$	371,404			$	165,036			$	123,862			$	1,208,712

Reconciliations of Total Segment Amounts

The following tables reconcile the Total Segment Revenues, Expenses and Distributable Earnings to their equivalent GAAP measure

f

or the three and six months ended June 30, 2021 and 2020 along with Total Assets as of June 30, 2021:

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Revenues
Total GAAP Revenues		$	5,291,354			$	2,516,069			$	10,590,226			$	(559,895	)
Less: Unrealized Performance Revenues (a)			(2,697,170	)			(1,067,923	)			(5,161,667	)			2,385,523
Less: Unrealized Principal Investment Income (b)			(104,658	)			(223,316	)			(528,592	)			393,294
Less: Interest and Dividend Revenue (c)			(32,931	)			(26,290	)			(64,343	)			(63,889	)
Less: Other Revenue (d)			(27,870	)			55,606				(88,143	)			(82,545	)
Impact of Consolidation (e)			(312,076	)			(141,599	)			(581,392	)			179,519
Amortization of Intangibles (f)			—				387				—				774
Transaction-Related Charges (g)			12				(1,310	)			(3,611	)			(2,140	)
Intersegment Eliminations			1,040				1,257				2,075				2,796
Total Segment Revenue (h)		$	2,117,701			$	1,112,881			$	4,164,553			$	2,253,437

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		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Expenses
Total GAAP Expenses		$	2,272,330			$	1,172,681			$	4,323,777			$	534,606
Less: Unrealized Performance  Allocations Compensation (i)			(1,150,219	)			(454,813	)			(2,200,188	)			942,565
Less: Equity-Based Compensation (j)			(121,422	)			(89,341	)			(265,694	)			(176,813	)
Less: Interest Expense (k)			(44,132	)			(38,924	)			(88,472	)			(80,464	)
Impact of Consolidation (e)			(6,647	)			(9,020	)			(11,747	)			(20,479	)
Amortization of Intangibles (f)			(17,044	)			(16,096	)			(34,168	)			(32,192	)
Transaction-Related Charges (g)			(35,521	)			(77,470	)			(67,032	)			(125,294	)
Administrative Fee Adjustment (l)			(2,551	)			—				(5,259	)			—
Intersegment Eliminations			1,040				1,257				2,075				2,796
Total Segment Expenses (m)		$	895,834			$	488,274			$	1,653,292			$	1,044,725

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Other Income
Total GAAP Other Income		$	126,724			$	158,373			$	249,987			$	(169,596	)
Impact of Consolidation (e)			(126,724	)			(158,373	)			(249,987	)			169,596
Total Segment Other Income		$	—			$	—			$	—			$	—

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Income (Loss) Before Provision (Benefit) for Taxes
Total GAAP Income (Loss) Before Provision (Benefit) for Taxes		$	3,145,748			$	1,501,761			$	6,516,436			$	(1,264,097	)
Less: Unrealized Performance Revenues (a)			(2,697,170	)			(1,067,923	)			(5,161,667	)			2,385,523
Less: Unrealized Principal Investment Income (b)			(104,658	)			(223,316	)			(528,592	)			393,294
Less: Interest and Dividend Revenue (c)			(32,931	)			(26,290	)			(64,343	)			(63,889	)
Less: Other Revenue (d)			(27,870	)			55,606				(88,143	)			(82,545	)
Plus: Unrealized Performance  Allocations Compensation (i)			1,150,219				454,813				2,200,188				(942,565	)
Plus: Equity-Based Compensation (j)			121,422				89,341				265,694				176,813
Plus: Interest Expense (k)			44,132				38,924				88,472				80,464
Impact of Consolidation (e)			(432,153	)			(290,952	)			(819,632	)			369,594
Amortization of Intangibles (f)			17,044				16,483				34,168				32,966
Transaction-Related Charges (g)			35,533				76,160				63,421				123,154
Administrative Fee Adjustment (l)			2,551				—				5,259				—
Total Segment Distributable Earnings		$	1,221,867			$	624,607			$	2,511,261			$	1,208,712

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		As of
		June 30,
		2021
Total Assets
Total GAAP Assets		$	33,297,192
Impact of Consolidation (e)			(1,511,857	)
Total Segment Assets		$	31,785,335

 

Segment basis presents revenues and expenses on a basis that deconsolidates the investment funds Blackstone manages and excludes the amortization of intangibles and Transaction-Related Charges.

(a)	This adjustment removes Unrealized Performance Revenues on a segment basis.

(b)	This adjustment removes Unrealized Principal Investment Income (Loss) on a segment basis.

(c)	This adjustment removes Interest and Dividend Revenue on a segment basis.

(d)

This adjustment removes Other Revenue on a segment basis. For the three months ended June 30, 2021 and 2020, Other Revenue on a GAAP basis was $27.9 million and $(55.6) million, and included $27.3 million and $(56.7) million of foreign exchange gains (losses), respectively. For the six months ended June 30, 2021 and 2020, Other Revenue on a GAAP basis was $88.2 million and $82.6 million, and included $86.9 million and $80.3 million of foreign exchange gains (losses), respectively.

(e)

This adjustment reverses the effect of consolidating Blackstone Funds, which are excluded from Blackstone’s segment presentation. This adjustment includes the elimination of Blackstone’s interest in these funds, the removal of revenue from the reimbursement of certain expenses by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures, and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

(f)

This adjustment removes the amortization of transaction-related intangibles, which are excluded from Blackstone’s segment presentation. This amount includes amortization of intangibles associated with Blackstone’s investment in Pátria, which was historically accounted for under the equity method. As a result of Pátria’s IPO in January 2021, equity method has been discontinued and there will no longer be amortization of intangibles associated with the investment.

(g)

This adjustment removes Transaction-Related Charges, which are excluded from Blackstone’s segment presentation. Transaction-Related Charges arise from corporate actions including acquisitions, divestitures, and Blackstone’s initial public offering. They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs and any gains or losses associated with these corporate actions.

(h)	Total Segment Revenues is comprised of the following:

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Total Segment Management and Advisory Fees, Net		$	1,212,742			$	976,733			$	2,390,947			$	1,917,300
Total Segment Fee Related Performance Revenues			48,889				15,033				218,057				27,499
Total Segment Realized Performance Revenues			792,938				102,177				1,194,261				269,410
Total Segment Realized Principal Investment Income			63,132				18,938				361,288				39,228
Total Segment Revenues		$	2,117,701			$	1,112,881			$	4,164,553			$	2,253,437

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(i)	This adjustment removes Unrealized Performance Allocations Compensation.

(j)	This adjustment removes Equity-Based Compensation on a segment basis.

(k)	This adjustment adds back Interest Expense on a segment basis, excluding interest expense related to the Tax Receivable Agreement.

(l)

This adjustment adds an amount equal to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units. The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.

(m)	Total Segment Expenses is comprised of the following:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Total Segment Fee Related Compensation		$	375,385			$	306,904			$	820,495			$	653,168
Total Segment Realized Performance Compensation			338,271				37,787				489,195				109,089
Total Segment Other Operating Expenses			182,178				143,583				343,602				282,468
Total Segment Expenses		$	895,834			$	488,274			$	1,653,292			$	1,044,725

Reconciliations of Total Segment Components

The following tables reconcile the components of Total Segments to their equivalent GAAP measures, reported on the Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2021 and 2020:

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
Management and Advisory Fees, Net
GAAP		$	1,212,549			$	969,728			$	2,390,364			$	1,904,560
Segment Adjustment (a)			193				7,005				583				12,740
Total Segment		$	1,212,742			$	976,733			$	2,390,947			$	1,917,300

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		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
GAAP Realized Performance Revenues to Total Segment Fee Related Performance Revenues
GAAP
Incentive Fees		$	33,207			$	15,300			$	69,331			$	27,461
Investment Income - Realized Performance Allocations			808,620				101,910				1,342,987				269,440
GAAP			841,827				117,210				1,412,318				296,901
Total Segment
Less: Realized Performance Revenues			(792,938	)			(102,177	)			(1,194,261	)			(269,410	)
Segment Adjustment (b)			—				—				—				8
Total Segment		$	48,889			$	15,033			$	218,057			$	27,499

 

		Three Months Ended								Six Months Ended
		J une 30 ,								J une 30 ,
		2021				2020				2021				2020
GAAP Compensation to Total Segment Fee Related Compensation
GAAP
Compensation		$	507,104			$	458,457			$	1,049,742			$	935,000
Incentive Fee Compensation			14,431				8,432				27,756				14,954
Realized Performance Allocations Compensation			347,423				38,569				560,450				110,992
GAAP			868,958				505,458				1,637,948				1,060,946
Total Segment
Less: Realized Performance Compensation			(338,271	)			(37,787	)			(489,195	)			(109,089	)
Less: Equity-Based Compensation - Operating Compensation			(119,491	)			(87,205	)			(261,165	)			(172,539	)
Less: Equity-Based Compensation - Performance Compensation			(1,931	)			(2,136	)			(4,529	)			(4,274	)
Segment Adjustment (c)			(33,880	)			(71,426	)			(62,564	)			(121,876	)
Total Segment		$	375,385			$	306,904			$	820,495			$	653,168

 

		Three Months Ended								Six Months Ended
		J une 30 ,								J une   30,
		2021				2020				2021				2020
GAAP General, Administrative and Other to Total Segment Other Operating Expenses
GAAP		$	205,057			$	169,051			$	390,179			$	326,617
Segment Adjustment (d)			(22,879	)			(25,468	)			(46,577	)			(44,149	)
Total Segment		$	182,178			$	143,583			$	343,602			$	282,468

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		Three Months Ended								Six Months Ended
		J une   30,								J une   30,
		2021				2020				2021				2020
Realized Performance Revenues
GAAP
Incentive Fees		$	33,207			$	15,300			$	69,331			$	27,461
Investment Income - Realized Performance Allocations			808,620				101,910				1,342,987				269,440
GAAP			841,827				117,210				1,412,318				296,901
Total Segment
Less: Fee Related Performance Revenues			(48,889	)			(15,033	)			(218,057	)			(27,499	)
Segment Adjustment (b)			—				—				—				8
Total Segment		$	792,938			$	102,177			$	1,194,261			$	269,410

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
Realized Performance Compensation
GAAP
Incentive Fee Compensation		$	14,431			$	8,432			$	27,756			$	14,954
Realized Performance Allocation Compensation			347,423				38,569				560,450				110,992
GAAP			361,854				47,001				588,206				125,946
Total Segment
Less: Fee Related Performance Compensation			(21,652	)			(7,078	)			(94,482	)			(12,583	)
Less: Equity-Based Compensation - Performance Compensation			(1,931	)			(2,136	)			(4,529	)			(4,274	)
Total Segment		$	338,271			$	37,787			$	489,195			$	109,089

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
Realized Principal Investment Income
GAAP		$	152,060			$	61,102			$	507,098			$	109,797
Segment Adjustment (e)			(88,928	)			(42,164	)			(145,810	)			(70,569	)
Total Segment		$	63,132			$	18,938			$	361,288			$	39,228

 

Segment basis presents revenues and expenses on a basis that deconsolidates the investment funds Blackstone manages and excludes the amortization of intangibles, the expense of equity-based awards and Transaction-Related Charges.

(a)

Represents (1) the add back of net management fees earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of revenue from the reimbursement of certain expenses by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures.

(b)	Represents the add back of Performance Revenues earned from consolidated Blackstone Funds which have been eliminated in consolidation.

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(c)	Represents the removal of Transaction-Related Charges that are not recorded in the Total Segment measures.

(d)

Represents the removal of (1) the amortization of transaction-related intangibles, and (2) certain expenses reimbursed by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures. The three and six months ended June 30, 2021 includes a reduction equal to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units which is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.

(e)

Represents (1) the add back of Principal Investment Income, including general partner income, earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

19.     Subsequent Events

On July 14, 2021, Blackstone announced that it entered into a stock purchase agreement with American International Group, Inc. (“AIG”) to acquire a 9.9% equity stake in SAFG Retirement Services, Inc. (“SAFG”) for an aggregate cash purchase price of $2.2 billion, subject to purchase price adjustments. SAFG is expected to be the parent company of AIG’s Life and Retirement (“AIG L&R”) business at the time of the anticipated initial public offering of AIG L&R, which AIG previously announced it is pursuing. In connection with the closing of the transaction, Blackstone will enter into a long-term strategic asset management partnership to serve as the exclusive investment manager of AIG L&R with respect to certain asset classes.

On August 5, 2021, Blackstone issued $650 million aggregate principal amount of 1.625% senior notes due August 5, 2028, $800 million aggregate principal amount of 2.000% senior notes due January 30, 2032 and $550 million aggregate principal amount of 2.850% senior notes due August 5, 2051. For additional information see Note 12. “Borrowings.”

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		June 30, 2021
		Consolidated				Consolidated
		Operating				Blackstone				Reclasses and
		Partnerships				Funds (a)				Eliminations				Consolidated
Assets
Cash and Cash Equivalents		$	2,467,444			$	—			$	—			$	2,467,444
Cash Held by Blackstone Funds and Other			—				109,676				—				109,676
Investments			20,700,820				1,871,269				(408,767	)			22,163,322
Accounts Receivable			502,168				80,374				—				582,542
Due from Affiliates			3,301,073				12,475				(153,719	)			3,159,829
Intangible Assets, Net			321,780				—				—				321,780
Goodwill			1,890,202				—				—				1,890,202
Other Assets			556,165				549				—				556,714
Right-of-Use Assets			723,539				—				—				723,539
Deferred Tax Assets			1,322,144				—				—				1,322,144
Total Assets		$	31,785,335			$	2,074,343			$	(562,486	)		$	33,297,192
Liabilities and Equity
Loans Payable		$	5,594,549			$	99			$	—			$	5,594,648
Due to Affiliates			1,125,981				254,241				(153,718	)			1,226,504
Accrued Compensation and Benefits			5,789,662				—				—				5,789,662
Securities Sold, Not Yet Purchased			11,953				23,830				—				35,783
Repurchase Agreements			—				57,247				—				57,247
Operating Lease Liabilities			841,152				—				—				841,152
Accounts Payable, Accrued Expenses and Other Liabilities			1,171,568				33,614				—				1,205,182
Total Liabilities			14,534,865				369,031				(153,718	)			14,750,178
Redeemable Non-Controlling Interests in Consolidated Entities			22,000				43,568				—				65,568
Equity
Common Stock			7				—				—				7
Series I Preferred Stock			—				—				—				—
Series II Preferred Stock			—				—				—				—
Additional Paid-in-Capital			6,282,600				383,095				(383,095	)			6,282,600
Retained Earnings			2,133,794				25,673				(25,673	)			2,133,794
Accumulated Other Comprehensive Loss			(10,245	)			—				—				(10,245	)
Non-Controlling Interests in Consolidated Entities			3,607,466				1,252,976				—				4,860,442
Non-Controlling Interests in Blackstone Holdings			5,214,848				—				—				5,214,848
Total Equity			17,228,470				1,661,744				(408,768	)			18,481,446
Total Liabilities and Equity		$	31,785,335			$	2,074,343			$	(562,486	)		$	33,297,192

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		December 31, 2020
		Consolidated				Consolidated
		Operating				Blackstone				Reclasses and
		Partnerships				Funds (a)				Eliminations				Consolidated
Assets
Cash and Cash Equivalents		$	1,999,484			$	—			$	—			$	1,999,484
Cash Held by Blackstone Funds and Other			—				64,972				—				64,972
Investments			14,425,035				1,455,008				(262,901	)			15,617,142
Accounts Receivable			746,059				120,099				—				866,158
Due from Affiliates			3,224,522				10,001				(13,008	)			3,221,515
Intangible Assets, Net			347,955				—				—				347,955
Goodwill			1,901,485				—				—				1,901,485
Other Assets			480,760				262				—				481,022
Right-of-Use Assets			526,943				—				—				526,943
Deferred Tax Assets			1,242,576				—				—				1,242,576
Total Assets		$	24,894,819			$	1,650,342			$	(275,909	)		$	26,269,252
Liabilities and Equity
Loans Payable		$	5,644,554			$	99			$	—			$	5,644,653
Due to Affiliates			1,070,955				77,095				(13,009	)			1,135,041
Accrued Compensation and Benefits			3,433,260				—				—				3,433,260
Securities Sold, Not Yet Purchased			9,324				41,709				—				51,033
Repurchase Agreements			—				76,808				—				76,808
Operating Lease Liabilities			620,844				—				—				620,844
Accounts Payable, Accrued Expenses and Other Liabilities			679,883				37,221				—				717,104
Total Liabilities			11,458,820				232,932				(13,009	)			11,678,743
Redeemable Non-Controlling Interests in Consolidated Entities			21,999				43,162				—				65,161
Equity
Common Stock			7				—				—				7
Series I Preferred Stock			—				—				—				—
Series II Preferred Stock			—				—				—				—
Additional Paid-in-Capital			6,332,105				269,235				(269,235	)			6,332,105
Retained Earnings			335,762				(6,335	)			6,335				335,762
Accumulated Other Comprehensive Loss			(15,831	)			—				—				(15,831	)
Non-Controlling Interests in Consolidated Entities			2,930,809				1,111,348				—				4,042,157
Non-Controlling Interests in Blackstone Holdings			3,831,148				—				—				3,831,148
Total Equity			13,414,000				1,374,248				(262,900	)			14,525,348
Total Liabilities and Equity		$	24,894,819			$	1,650,342			$	(275,909	)		$	26,269,252

(a)	The Consolidated Blackstone Funds consisted of the following:

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•

Real Estate. Our real estate business is a global leader in real estate investing. Our Real Estate segment operates as one globally integrated business, with investments in the Americas, Europe and Asia. Our real estate investment teams seek to utilize our global expertise and presence to generate attractive risk-adjusted returns for our investors and to make a positive impact on the communities in which we invest. Blackstone Real Estate seeks to invest thematically in high-quality assets, focusing where we see outsized growth potential driven by global economic and demographic trends. Blackstone Real Estate has made significant investments in logistics, office, rental housing, hospitality and retail properties around the world, as well as a variety of real estate operating companies.

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•

Private Equity. Our Private Equity segment includes our corporate private equity business, which consists of (a) our flagship private equity funds (Blackstone Capital Partners (“BCP”) funds), which includes global funds as well as funds focused specifically on Asia investments, (b) our sector-focused private equity funds, including our energy-focused funds (Blackstone Energy Partners (“BEP”) funds) and (c) our core private equity funds, Blackstone Core Equity Partners (“BCEP”). In addition, our Private Equity segment includes (a) our opportunistic investment platform that invests globally across asset classes, industries and geographies, Blackstone Tactical Opportunities (“Tactical Opportunities”), (b) our secondary fund of funds business, Strategic Partners Fund Solutions (“Strategic Partners”), (c) our infrastructure-focused funds, Blackstone Infrastructure Partners (“BIP”), (d) our life sciences private investment platform, Blackstone Life Sciences (“BXLS”), (e) our growth equity investment platform, Blackstone Growth (“BXG”), (f) a multi-asset investment program for eligible high net worth investors offering exposure to certain of Blackstone’s key illiquid investment strategies through a single commitment, Blackstone Total Alternatives Solution (“BTAS”) and (g) our capital markets services business, Blackstone Capital Markets (“BXCM”).

•

Hedge Fund Solutions. The principal component of our Hedge Fund Solutions segment is Blackstone Alternative Asset Management (“BAAM”). BAAM is the world’s largest discretionary allocator to hedge funds, managing a broad range of commingled and customized fund solutions since its inception in 1990. The Hedge Fund Solutions segment also includes investment platforms that seed new hedge fund businesses, purchase minority interests in more established general partners and management companies of funds, invest in special situation opportunities, create alternative solutions through daily liquidity products and invest directly.

•

Credit & Insurance. The principal component of our Credit & Insurance segment is Blackstone Credit (“BXC”). BXC is one of the largest credit-oriented managers in the world and is the largest manager of collateralized loan obligations (“CLOs”) globally. The investment portfolios of the funds BXC manages or sub-advises predominantly consist of loans and securities of non-investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity.

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(a)

the fair value of the investments held by our carry funds and our side-by-side and co-investment entities managed by us plus the capital that we are entitled to call from investors in those funds and entities pursuant to the terms of their respective capital commitments, including capital commitments to funds that have yet to commence their investment periods,

(b)

the net asset value of (1) our hedge funds, real estate debt carry funds, BPP, certain co-investments managed by us, certain credit-focused funds, and our Hedge Fund Solutions drawdown funds (plus, in each case, the capital that we are entitled to call from investors in those funds, including commitments yet to commence their investment periods), and (2) our funds of hedge funds, our Hedge Fund Solutions registered investment companies, and BREIT,

(c)

the invested capital, fair value or net asset value of assets we manage pursuant to separately managed accounts,

(d)

the amount of debt and equity outstanding for our CLOs during the reinvestment period,

(e)

the aggregate par amount of collateral assets, including principal cash, for our CLOs after the reinvestment period,

(f)

the gross or net amount of assets (including leverage where applicable) for our credit-focused registered investment companies,

(g)

the fair value of common stock, preferred stock, convertible debt, term loans or similar instruments issued by BXMT, and

(h)

borrowings under and any amounts available to be borrowed under certain credit facilities of our funds.

(a)

for our Private Equity segment funds and Real Estate segment carry funds, including certain BREDS and Hedge Fund Solutions funds, the amount of capital commitments, remaining invested capital, fair value, net asset value or par value of assets held, depending on the fee terms of the fund,

(b)

for our credit-focused carry funds, the amount of remaining invested capital (which may include leverage) or net asset value, depending on the fee terms of the fund,

(c)

the remaining invested capital or fair value of assets held in co-investment vehicles managed by us on which we receive fees,

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(d)

the net asset value of our funds of hedge funds, hedge funds, BPP, certain co-investments managed by us, certain registered investment companies, BREIT, and certain of our Hedge Fund Solutions drawdown funds,

(e)

the invested capital, fair value of assets or the net asset value we manage pursuant to separately managed accounts,

(f)

the net proceeds received from equity offerings and accumulated distributable earnings of BXMT, subject to certain adjustments,

(g)

the aggregate par amount of collateral assets, including principal cash, of our CLOs, and

(h)

the gross amount of assets (including leverage) or the net assets (plus leverage where applicable) for certain of our credit-focused registered investment companies.

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		Three Months Ended																Six Months Ended
		June 30,								2021 vs. 2020								June 30,								2021 vs. 2020
		2021				2020				$				%				2021				2020				$				%
		(Dollars in Thousands)
Revenues
Management and Advisory Fees, Net		$	1,212,549			$	969,728			$	242,821				25	%		$	2,390,364			$	1,904,560			$	485,804				26	%
Incentive Fees			33,207				15,300				17,907				117	%			69,331				27,461				41,870				152	%
Investment Income (Loss)
Performance Allocations
Realized			808,620				101,910				706,710				693	%			1,342,987				269,440				1,073,547				398	%
Unrealized			2,697,170				1,067,923				1,629,247				153	%			5,161,667				(2,385,158	)			7,546,825				n/m
Principal Investments
Realized			152,060				61,102				90,958				149	%			507,098				109,797				397,301				362	%
Unrealized			328,835				331,762				(2,927	)			-1	%			968,150				(627,603	)			1,595,753				n/m
Total Investment Income (Loss)			3,986,685				1,562,697				2,423,988				155	%			7,979,902				(2,633,524	)			10,613,426				n/m
Interest and Dividend Revenue			31,017				23,924				7,093				30	%			62,429				59,008				3,421				6	%
Other			27,896				(55,580	)			83,476				n/m				88,200				82,600				5,600				7	%
Total Revenues			5,291,354				2,516,069				2,775,285				110	%			10,590,226				(559,895	)			11,150,121				n/m
Expenses
Compensation and Benefits
Compensation			507,104				458,457				48,647				11	%			1,049,742				935,000				114,742				12	%
Incentive Fee Compensation			14,431				8,432				5,999				71	%			27,756				14,954				12,802				86	%
Performance Allocations Compensation
Realized			347,423				38,569				308,854				801	%			560,450				110,992				449,458				405	%
Unrealized			1,150,219				454,813				695,406				153	%			2,200,188				(942,565	)			3,142,753				n/m
Total Compensation and Benefits			2,019,177				960,271				1,058,906				110	%			3,838,136				118,381				3,719,755				n/m
General, Administrative and Other			205,057				169,051				36,006				21	%			390,179				326,617				63,562				19	%
Interest Expense			44,322				39,276				5,046				13	%			89,305				80,920				8,385				10	%
Fund Expenses			3,774				4,083				(309	)			-8	%			6,157				8,688				(2,531	)			-29	%
Total Expenses			2,272,330				1,172,681				1,099,649				94	%			4,323,777				534,606				3,789,171				709	%
Other Income (Loss)
Change in Tax Receivable Agreement Liability			(392	)			76				(468	)			n/m				2,518				(519	)			3,037				n/m
Net Gains (Losses) from Fund Investment Activities			127,116				158,297				(31,181	)			-20	%			247,469				(169,077	)			416,546				n/m
Total Other Income (Loss)			126,724				158,373				(31,649	)			-20	%			249,987				(169,596	)			419,583				n/m
Income (Loss) Before Provision (Benefit) for Taxes			3,145,748				1,501,761				1,643,987				109	%			6,516,436				(1,264,097	)			7,780,533				n/m
Provision (Benefit) for Taxes			288,250				147,415				140,835				96	%			287,803				(11,288	)			299,091				n/m
Net Income (Loss)			2,857,498				1,354,346				1,503,152				111	%			6,228,633				(1,252,809	)			7,481,442				n/m
Net Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			637				(3,426	)			4,063				n/m				1,266				(18,895	)			20,161				n/m
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			431,516				294,378				137,138				47	%			818,366				(350,699	)			1,169,065				n/m
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			1,116,193				495,128				621,065				125	%			2,351,977				(384,989	)			2,736,966				n/m
Net Income (Loss) Attributable to The Blackstone Group Inc.		$	1,309,152			$	568,266			$	740,886				130	%		$	3,057,024			$	(498,226	)		$	3,555,250				n/m

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•

The increase in our Real Estate segment was primarily attributable to higher net unrealized appreciation of investment holdings in our BREP opportunistic funds in the three months ended June 30, 2021 compared to the three months ended June 30, 2020. The carrying value of investments for our BREP opportunistic funds increased 9.4% in the three months ended June 30, 2021 compared to 1.6% in the three months ended June 30, 2020.

•

The increase in our Private Equity segment was primarily attributable to higher net unrealized appreciation of investment holdings in corporate private equity and Strategic Partners in the three months ended June 30, 2021 compared to the three months ended June 30, 2020. Corporate private equity carrying value increased 13.8% in the three months ended June 30, 2021 compared to 12.8% in the three months ended June 30, 2020. Strategic Partners carrying value increased 17.7% in the three months ended June 30, 2021 compared to 3.8% in the three months ended June 30, 2020.

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•

The increase in our Private Equity segment was primarily attributable to higher net unrealized appreciation of investment holdings in corporate private equity, Tactical Opportunities and Strategic Partners in the six months ended June 30, 2021 compared to the six months ended June 30, 2020. Corporate private equity carrying value increased 29.0% in the six months ended June 30, 2021 compared to a decrease of 12.4% in the six months ended June 30, 2020. Tactical Opportunities carrying value increased 22.1% in the six months ended June 30, 2021 compared to a decrease of 6.1% in the six months ended June 30, 2020. Strategic Partners carrying value increased 28.7% in the six months ended June 30, 2021 compared to 5.6% in the six months ended June 30, 2020.

•

The increase in our Real Estate segment was primarily attributable to higher net unrealized appreciation of investment holdings in our BREP opportunistic funds in the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The carrying value of investments for our BREP opportunistic funds increased 14.9% in the six months ended June 30, 2021 compared to a decrease of 7.6% in the six months ended June 30, 2020.

•

The increase in our Credit & Insurance segment was primary attributable to net unrealized appreciation of investments in our private credit strategies in the six months ended June 30, 2021 compared to net unrealized depreciation in the six months ended June 30, 2020.

•

The increase in our Hedge Fund Solutions segment was primarily due to the net unrealized appreciation of investments of which Blackstone owns a share in the six months ended June 30, 2021 compared to net unrealized depreciation in the six months ended June 30, 2020.

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		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
Income (Loss) Before Provision (Benefit) for Taxes		$	3,145,748			$	1,501,761			$	6,516,436			$	(1,264,097	)
Provision (Benefit) for Taxes		$	288,250			$	147,415			$	287,803			$	(11,288	)
Effective Income Tax Rate			9.2	%			9.8	%			4.4	%			0.9	%

		Three Months Ended								2021				Six Months Ended								2021
		June 30,								vs.				June 30,								vs.
		2021				2020				2020				2021				2020				2020
Statutory U.S. Federal Income Tax Rate			21.0%				21.0%				—				21.0%				21.0%				—
Income Passed Through to Non-Controlling Interest Holders (a)(b)			-10.4%				-10.6%				0.2%				-10.3%				-12.9%				2.6%
State and Local Income Taxes			2.2%				2.2%				—				2.2%				0.3%				1.9%
Change in Valuation Allowance			-4.0%				-3.8%				-0.2%				-8.6%				-5.0%				-3.6%
Other (a)			0.4%				1.0%				-0.6%				0.1%				-2.5%				2.6%
Effective Income Tax Rate			9.2%				9.8%				-0.6%				4.4%				0.9%				3.5%

(a)

During the three months ended June 30, 2021, Blackstone recategorized certain components of its effective income tax reconciliation. Accordingly, certain components related to income attributable to non-controlling interest holders were recategorized from Income Passed Through to Non-Controlling Interest Holders to Other. Prior periods have been recast accordingly. The recategorization had no effect on Blackstone’s Provision (Benefit) for Taxes.

(b)	Includes income that was not taxable to Blackstone and its subsidiaries. Such income remains taxable to Blackstone’s non-controlling interest holders.

---

---

---

		Three Months Ended
		June 30, 2021																				June 30, 2020
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Fee-Earning Assets Under Management
Balance, Beginning of Period		$	155,851,794			$	131,903,347			$	76,614,206			$	116,856,060			$	481,225,407			$	130,424,462			$	128,300,802			$	68,214,435			$	96,115,338			$	423,055,037
Inflows (a)			9,834,475				2,320,367				1,794,869				14,734,257				28,683,968				3,572,729				3,980,763				3,480,682				4,552,263				15,586,437
Outflows (b)			(581,677	)			(457,610	)			(8,277,079	)			(2,502,137	)			(11,818,503	)			(730,177	)			(1,945,670	)			(4,548,271	)			(2,080,773	)			(9,304,891	)
Net Inflows (Outflows)			9,252,798				1,862,757				(6,482,210	)			12,232,120				16,865,465				2,842,552				2,035,093				(1,067,589	)			2,471,490				6,281,546
Realizations (c)			(3,069,895	)			(3,304,081	)			(294,858	)			(4,029,664	)			(10,698,498	)			(998,351	)			(1,118,162	)			(512,215	)			(1,078,291	)			(3,707,019	)
Market Activity (d)(g)			4,228,796				2,013,463				2,403,014				2,894,879				11,540,152				1,991,685				66,379				3,565,510				4,572,797				10,196,371
Balance, End of Period (e)		$	166,263,493			$	132,475,486			$	72,240,152			$	127,953,395			$	498,932,526			$	134,260,348			$	129,284,112			$	70,200,141			$	102,081,334			$	435,825,935
Increase (Decrease)		$	10,411,699			$	572,139			$	(4,374,054	)		$	11,097,335			$	17,707,119			$	3,835,886			$	983,310			$	1,985,706			$	5,965,996			$	12,770,898
Increase (Decrease)			7	%			—				-6	%			9	%			4	%			3	%			1	%			3	%			6	%			3	%

		Six Months Ended
		June 30, 2021																				June 30, 2020
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Fee-Earning Assets Under Management
Balance, Beginning of Period		$	149,121,461			$	129,539,630			$	74,126,610			$	116,645,413			$	469,433,114			$	128,214,137			$	97,773,964			$	75,636,004			$	106,450,747			$	408,074,852
Inflows (a)			18,395,652				6,788,988				3,800,855				22,920,908				51,906,403				13,001,518				39,306,793				5,847,645				8,188,108				66,344,064
Outflows (b)			(1,425,237	)			(1,065,631	)			(9,623,330	)			(7,618,014	)			(19,732,212	)			(1,741,073	)			(5,558,119	)			(7,200,263	)			(4,821,457	)			(19,320,912	)
Net Inflows (Outflows)			16,970,415				5,723,357				(5,822,475	)			15,302,894				32,174,191				11,260,445				33,748,674				(1,352,618	)			3,366,651				47,023,152
Realizations (c)			(4,925,197	)			(6,375,260	)			(483,294	)			(7,276,868	)			(19,060,619	)			(3,696,112	)			(2,043,516	)			(646,945	)			(2,508,418	)			(8,894,991	)
Market Activity (d)(h)			5,096,814				3,587,759				4,419,311				3,281,956				16,385,840				(1,518,122	)			(195,010	)			(3,436,300	)			(5,227,646	)			(10,377,078	)
Balance, End of Period (e)		$	166,263,493			$	132,475,486			$	72,240,152			$	127,953,395			$	498,932,526			$	134,260,348			$	129,284,112			$	70,200,141			$	102,081,334			$	435,825,935
Increase (Decrease)		$	17,142,032			$	2,935,856			$	(1,886,458	)		$	11,307,982			$	29,499,412			$	6,046,211			$	31,510,148			$	(5,435,863	)		$	(4,369,413	)		$	27,751,083
Increase (Decrease)			11	%			2	%			-3	%			10	%			6	%			5	%			32	%			-7	%			-4	%			7	%
Annualized Base Management Fee Rate (f)			1.12	%			1.13	%			0.82	%			0.55	%			0.93	%			1.15	%			0.88	%			0.80	%			0.57	%			0.88	%

---

		Three Months Ended
		June 30, 2021																				June 30, 2020
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Total Assets Under Management
Balance, Beginning of Period		$	196,277,032			$	211,801,085			$	81,819,220			$	158,905,670			$	648,803,007			$	160,934,849			$	174,695,883			$	73,720,792			$	128,655,761			$	538,007,285
Inflows (a)			8,879,659				7,335,028				2,197,161				18,869,609				37,281,457				4,884,629				5,202,708				3,323,861				6,857,865				20,269,063
Outflows (b)			(579,152	)			(1,077,784	)			(7,299,018	)			(2,716,532	)			(11,672,486	)			(713,861	)			(668,799	)			(4,618,615	)			(2,346,962	)			(8,348,237	)
Net Inflows (Outflows)			8,300,507				6,257,244				(5,101,857	)			16,153,077				25,608,971				4,170,768				4,533,909				(1,294,754	)			4,510,903				11,920,826
Realizations (c)			(5,306,047	)			(8,633,166	)			(303,557	)			(5,390,278	)			(19,633,048	)			(2,264,204	)			(2,990,225	)			(516,843	)			(1,579,530	)			(7,350,802	)
Market Activity (d)(i)(k)			8,276,744				14,196,196				2,731,457				4,045,385				29,249,782				3,882,431				7,878,568				3,758,944				6,232,836				21,752,779
Balance, End of Period (e)		$	207,548,236			$	223,621,359			$	79,145,263			$	173,713,854			$	684,028,712			$	166,723,844			$	184,118,135			$	75,668,139			$	137,819,970			$	564,330,088
Increase (Decrease)		$	11,271,204			$	11,820,274			$	(2,673,957	)		$	14,808,184			$	35,225,705			$	5,788,995			$	9,422,252			$	1,947,347			$	9,164,209			$	26,322,803
Increase (Decrease)			6	%			6	%			-3	%			9	%			5	%			4	%			5	%			3	%			7	%			5	%

		Six Months Ended
		June 30, 2021																				June 30, 2020
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Total Assets Under Management
Balance, Beginning of Period		$	187,191,247			$	197,549,222			$	79,422,869			$	154,393,590			$	618,556,928			$	163,156,064			$	182,886,109			$	80,738,112			$	144,342,178			$	571,122,463
Inflows (a)			17,461,122				15,166,670				4,264,119				31,993,631				68,885,542				17,537,804				14,071,559				6,570,522				9,401,686				47,581,571
Outflows (b)			(2,388,253	)			(1,828,756	)			(8,922,346	)			(8,508,421	)			(21,647,776	)			(1,507,549	)			(1,067,275	)			(7,499,898	)			(5,188,261	)			(15,262,983	)
Net Inflows (Outflows)			15,072,869				13,337,914				(4,658,227	)			23,485,210				47,237,766				16,030,255				13,004,284				(929,376	)			4,213,425				32,318,588
Realizations (c)			(7,259,579	)			(16,726,541	)			(497,904	)			(10,017,051	)			(34,501,075	)			(4,783,000	)			(5,021,331	)			(655,830	)			(3,279,335	)			(13,739,496	)
Market Activity (d)(j)(k)			12,543,699				29,460,764				4,878,525				5,852,105				52,735,093				(7,679,475	)			(6,750,927	)			(3,484,767	)			(7,456,298	)			(25,371,467	)
Balance, End of Period (e)		$	207,548,236			$	223,621,359			$	79,145,263			$	173,713,854			$	684,028,712			$	166,723,844			$	184,118,135			$	75,668,139			$	137,819,970			$	564,330,088
Increase (Decrease)		$	20,356,989			$	26,072,137			$	(277,606	)		$	19,320,264			$	65,471,784			$	3,567,780			$	1,232,026			$	(5,069,973	)		$	(6,522,208	)		$	(6,792,375	)
Increase (Decrease)			11	%			13	%			—				13	%			11	%			2	%			1	%			-6	%			-5	%			-1	%

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(a)	Inflows represent contributions, capital raised, other increases in available capital (recallable capital and increased side-by-side commitments), purchases, inter-segment allocations and acquisitions.

(b)	Outflows represent redemptions, client withdrawals and decreases in available capital (expired capital, expense drawdowns and decreased side-by-side commitments).

(c)	Realizations represent realization proceeds from the disposition or other monetization of assets, current income or capital returned to investors from CLOs.

(d)	Market activity includes realized and unrealized gains (losses) on portfolio investments and the impact of foreign exchange rate fluctuations.

(e)	Total and Fee-Earning Assets Under Management are reported in the segment where the assets are managed.

(f)	Annualized Base Management Fee Rate represents annualized year to date Base Management Fee divided by the average of the beginning of year and each quarter end’s Fee-Earning Assets Under Management in the reporting period.

(g)

For the three months ended June 30, 2021, the impact to Fee-Earning Assets Under Management due to foreign exchange rate fluctuations was $332.1 million, $262.1 million and $599.8 million for the Real Estate, Credit & Insurance and Total segments, respectively. For the three months ended June 30, 2020, such impact was $546.9 million, $260.7 million and $809.6 million for the Real Estate, Credit & Insurance and Total segments, respectively.

(h)

For the six months ended June 30, 2021, the impact to Fee-Earning Assets Under Management due to foreign exchange rate fluctuations was $(777.3) million, $130.7 million and $(659.6) million for the Real Estate, Credit & Insurance and Total segments, respectively. For the six months ended June 30, 2020, such impact was $(211.6) million, $(14.4) million and $(223.9) million for the Real Estate, Credit & Insurance and Total segments, respectively.

(i)

For the three months ended June 30, 2021, the impact to Total Assets Under Management due to foreign exchange rate fluctuations was $452.1 million, $68.4 million, $361.8 million and $882.3 million for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively. For the three months ended June 30, 2020, such impact was $1.0 billion, $37.0 million, $336.4 million and $1.4 billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively.

(j)

For the six months ended June 30, 2021, the impact to Total Assets Under Management due to foreign exchange rate fluctuations was $(1.2) billion, $(262.2) million, $115.5 million and $(1.3) billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively. For the six months ended June 30, 2020, such impact was $(471.6) million, $(564.6) million, $(65.6) million and $(1.1) billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively.

(k)

Effective in the three months ended June 30, 2021, the methodology for Total Assets Under Management was updated to exclude permanent fund leverage where the intended use is not for investing purposes. Funds without an adjustment were either already applying the methodology in reporting Total Assets Under Management or the update was not applicable. Additional detail on these adjustments is included below:

		Three Months Ended June 30, 2021
						Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Market Activity		$	10,103,225			$	14,196,196			$	2,731,457			$	4,045,385			$	31,076,263
One-Time Methodology Adjustment			(1,826,481	)			—				—				—				(1,826,481	)
Reported Market Activity		$	8,276,744			$	14,196,196			$	2,731,457			$	4,045,385			$	29,249,782

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		Six Months Ended June 30, 2021
						Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Market Activity		$	14,370,180			$	29,460,764			$	4,878,525			$	5,852,105			$	54,561,574
One-Time Methodology Adjustment			(1,826,481	)			—				—				—				(1,826,481	)
Reported Market Activity		$	12,543,699			$	29,460,764			$	4,878,525			$	5,852,105			$	52,735,093

•

Inflows of $28.7 billion related to:

o

$14.7 billion in our Credit & Insurance segment driven by $5.5 billion from direct lending, $4.1 billion from certain liquid credit and MLP strategies, $3.6 billion from CLOs, $2.0 billion from BIS, $1.2 billion from our structured products group, $435.3 million from mezzanine funds, $245.3 million from stressed/distressed strategies and $189.5 million from energy strategies, all partially offset by $2.5 billion of allocations to various strategies and other segments,

o

$9.8 billion in our Real Estate segment driven by $5.8 billion from BREIT, $3.0 billion from BREDS due to capital being deployed (this amount was previously reflected in Inflows for Total Assets Under Management at each capital closing of the fund), $453.3 million from BPP Europe and co-investment and $437.0 million from BPP U.S. and co-investment,

o

$2.3 billion in our Private Equity segment driven by $958.8 million from Strategic Partners, $922.6 million from corporate private equity and $527.3 million from Tactical Opportunities, and

o

$1.8 billion in our Hedge Fund Solutions segment driven by $1.2 billion from individual investor and specialized solutions, $333.9 million from commingled products and $310.1 million from customized solutions.

•

Market activity of $11.5 billion primarily attributable to:

o

$4.2 billion of market appreciation in our Real Estate segment driven by appreciation of $3.9 billion from Core+ real estate, $199.6 million from BREDS and $128.8 million from BREP opportunistic and co-investment, all of which included $332.1 million of foreign exchange appreciation across the segment,

o

$2.9 billion of market appreciation in our Credit & Insurance segment driven by appreciation of $2.3 billion from certain liquid credit and MLP strategies, $341.3 million from CLOs and $274.5 million from direct lending, partially offset by $116.4 million of market depreciation from energy strategies, all of which included $262.1 million of foreign exchange appreciation across the segment,

o

$2.4 billion of market appreciation in our Hedge Fund Solutions segment driven by returns from BAAM’s Principal Solutions Composite of 3.5% gross (3.2% net), and

o

$2.0 billion of market appreciation in our Private Equity segment driven by $1.3 billion from Strategic Partners and $724.0 million from BIP.

•

Outflows of $11.8 billion primarily attributable to:

o

$8.3 billion in our Hedge Fund Solutions segment driven by $6.4 billion from customized solutions, $1.3 billion from commingled products and $584.1 million from individual investor and specialized solutions, and

---

o

$2.5 billion in our Credit & Insurance segment driven by $1.4 billion from certain liquid credit and MLP strategies, $331.1 million from BIS and $107.9 million from stressed/distressed strategies.

•

Realizations of $10.7 billion driven by:

o

$4.0 billion in our Credit & Insurance segment driven by $2.2 billion from CLOs, $635.0 million from direct lending, $624.3 million from stressed/distressed strategies, $225.2 million from mezzanine funds, $196.6 million from energy strategies and $159.1 million from certain liquid credit and MLP strategies,

o

$3.3 billion in our Private Equity segment driven by $1.3 billion from Strategic Partners, $1.1 billion from corporate private equity and $878.5 million from Tactical Opportunities, and

o

$3.1 billion in our Real Estate segment driven by $1.2 billion from BREP opportunistic funds and co-investment, $969.5 million from BREDS and $857.7 million from Core+ real estate.

•

Inflows of $51.9 billion related to:

o

$22.9 billion in our Credit & Insurance segment driven by $8.8 billion from direct lending, $5.4 billion from certain liquid credit and MLP strategies, $3.6 billion from CLOs, $2.3 billion from BIS, $1.3 billion from our structured products group, $869.5 million from mezzanine funds, $349.1 million from stressed/distressed strategies and $304.9 million from energy strategies,

o

$18.4 billion in our Real Estate segment driven by $8.9 billion from BREIT, $5.9 billion from BREDS due to capital being deployed (this amount was previously reflected in Inflows for Total Assets Under Management at each capital closing of the fund), $2.0 billion from BPP Life Sciences, $638.4 million from BPP U.S. and co-investment, $463.3 million from BPP Europe and co-investment, $326.8 million from BREP opportunistic funds and co-investment and $198.3 million from BPP Asia,

o

$6.8 billion in our Private Equity segment driven by $2.5 billion from corporate private equity, $1.4 billion from BXG, $1.2 billion from Tactical Opportunities, $1.0 billion from Strategic Partners and $659.1 million from multi-asset products, and

o

$3.8 billion in our Hedge Fund Solutions segment driven by $2.5 billion from individual investor and specialized solutions, $727.8 million from customized solutions and $547.0 million from commingled products.

•

Market activity of $16.4 billion primarily attributable to:

o

$5.1 billion of market appreciation in our Real Estate segment driven by appreciation of $5.7 billion from Core+ real estate and $200.6 million from BREDS, partially offset by foreign exchange depreciation of $396.4 million from Core+ real estate and $381.3 million from BREP opportunistic and co-investment,

o

$4.4 billion of market appreciation in our Hedge Fund Solutions segment driven by returns from BAAM’s Principal Solutions Composite of 6.0% gross (5.5% net),

o

$3.6 billion of market appreciation in our Private Equity segment driven by $2.1 billion from Strategic Partners and $1.5 billion from BIP, and

o

$3.3 billion of market appreciation in our Credit & Insurance segment driven by appreciation of $2.6 billion from certain liquid credit and MLP strategies, $332.9 million from CLOs and $319.9 million from direct lending, partially offset by $116.4 million of market depreciation from energy strategies, all of which included $130.7 million of foreign exchange appreciation across the segment.

---

•

Outflows of $19.7 billion primarily attributable to:

o

$9.6 billion in our Hedge Fund Solutions segment driven by $6.7 billion from customized solutions, $1.5 billion from individual investor and specialized solutions and $1.4 billion from commingled products,

o

$7.6 billion in our Credit & Insurance segment driven by $3.8 billion from certain liquid credit and MLP strategies, $2.7 billion from BIS, $469.3 million from CLOs and $307.4 million from stressed/distressed strategies,

o

$1.4 billion in our Real Estate segment driven by $876.0 million from BREIT, $370.1 million from BPP U.S. and co-investment and $141.0 million from BREDS, and

o

$1.1 billion in our Private Equity segment driven by $418.1 million from Tactical Opportunities, $386.0 million from multi-asset products and $245.5 million from Strategic Partners.

•

Realizations of $19.1 billion primarily driven by:

o

$7.3 billion in our Credit & Insurance segment driven by $2.9 billion from CLOs, $1.8 billion from direct lending, $996.4 million from stressed/distressed strategies, $866.6 million from mezzanine funds, $355.0 million from energy strategies and $319.1 million from certain liquid credit and MLP strategies,

o

$6.4 billion in our Private Equity segment driven by $2.4 billion from corporate private equity, $2.2 billion from Strategic Partners and $1.6 billion from Tactical Opportunities, and

o

$4.9 billion in our Real Estate segment driven by $1.8 billion from BREP opportunistic funds and co-investment, $1.7 billion from BREDS and $1.5 billion from Core+ real estate.

•

Inflows of $37.3 billion primarily related to:

o

$18.9 billion in our Credit & Insurance segment driven by $9.5 billion from direct lending (which exceeds Fee-Earning Assets Under Management inflows principally due to certain funds charging fees on net assets versus gross assets), $4.3 billion from certain liquid credit and MLP strategies, $3.6 billion from CLOs, $2.0 billion from BIS, $981.3 million from mezzanine funds and $868.6 million from our structured products group, all partially offset by $2.4 billion of allocations to various strategies and other segments,

o

$8.9 billion in our Real Estate segment driven by $5.8 billion from BREIT, $1.2 billion from BREDS, $911.0 million from BPP Europe and co-investment, $437.2 million from BPP U.S. and co-investment, $243.8 million from BPP Life Sciences, $175.6 million from BREP opportunistic funds and $125.4 million from BPP Asia,

o

$7.3 billion in our Private Equity segment driven by $3.6 billion from Strategic Partners, $2.5 billion from corporate private equity and $1.1 billion from Tactical Opportunities, and

o

$2.2 billion in our Hedge Fund Solutions segment driven by $1.4 billion from individual investor and specialized solutions, $429.3 million from commingled products and $356.8 million from customized solutions.

•

Market activity of $29.2 billion primarily driven by:

o

$14.2 billion of market appreciation in our Private Equity segment driven by carrying value increases in corporate private equity, Tactical Opportunities and Strategic Partners of 13.8%, 7.2% and 17.7%, during the quarter, respectively, which includes $68.4 million of foreign exchange appreciation across the segment,

---

o

$8.3 billion of market appreciation in our Real Estate segment driven by carrying value increases in opportunistic and Core+ real estate of 9.4% and 5.7%, during the quarter, respectively, which includes $452.1 million of foreign exchange appreciation across the segment,

o

$4.0 billion of market appreciation in our Credit & Insurance segment driven by appreciation of $2.5 billion from certain liquid credit and MLP strategies, $520.2 million from direct lending, $290.9 million from mezzanine funds, $262.2 million from CLOs, $213.9 million from stressed/distressed strategies and $180.0 million from energy strategies, all of which included $361.8 million of foreign exchange appreciation across the segment, and

o

$2.7 billion of market appreciation in our Hedge Fund Solutions segment driven by reasons noted above in Fee-Earning Assets Under Management.

•

Realizations of $19.6 billion primarily driven by:

o

$8.6 billion in our Private Equity segment driven by $4.0 billion from corporate private equity, $2.6 billion from Strategic Partners and $1.8 billion from Tactical Opportunities,

o

$5.4 billion in our Credit & Insurance segment driven by $2.1 billion from CLOs, $1.1 billion from direct lending, $1.1 billion from stressed/distressed strategies, $508.1 million from mezzanine funds, $355.6 million from energy strategies and $173.1 million from certain liquid credit and MLP strategies, and

o

$5.3 billion in our Real Estate segment driven by $4.0 billion from BREP opportunistic and co-investment, $877.7 million from Core+ real estate and $461.4 million from BREDS.

•

Outflows of $11.7 billion primarily attributable to:

o

$7.3 billion in our Hedge Fund Solutions segment driven by $5.3 billion from customized solutions, $1.4 billion from commingled products and $587.9 million from individual investor and specialized solutions,

o

$2.7 billion in our Credit & Insurance segment driven by $1.5 billion from certain liquid credit and MLP strategies, $534.4 million from CLOs and $347.2 million from BIS, and

o

$1.1 billion on our Private Equity segment driven by $600.3 million from Tactical Opportunities and $183.2 million from multi-asset products.

•

Inflows of $68.9 billion primarily related to:

o

$32.0 billion in our Credit & Insurance segment driven by $16.6 billion from direct lending (which exceeds Fee-Earning Assets Under Management inflows principally due to certain funds charging fees on net assets versus gross assets), $5.2 billion from certain liquid credit and MLP strategies, $3.7 billion from CLOs, $2.7 billion from our structured products group, $2.0 billion from BIS and $1.5 billion from mezzanine funds,

---

o

$17.5 billion in our Real Estate segment driven by $9.3 billion from BREIT, $4.1 billion from BPP Life Sciences, $1.6 billion from BREDS, $1.0 billion from BPP Europe and co-investment, $639.3 million from BPP U.S. and co-investment, $533.1 million from BREP opportunistic funds and $286.4 million from BPP Asia,

o

$15.2 billion in our Private Equity segment driven by $6.2 billion from corporate private equity, $4.2 billion from Strategic Partners, $2.3 billion from Tactical Opportunities, $1.9 billion from BXG and $481.3 million from multi-asset products, and

o

$4.3 billion in our Hedge Fund Solutions segment driven by $3.0 billion from individual investor and specialized solutions, $654.9 million from customized solutions and $621.3 million from commingled products.

•

Market activity of $52.7 billion primarily driven by:

o

$29.5 billion of market appreciation in our Private Equity segment driven by carrying value increases in corporate private equity, Tactical Opportunities and Strategic Partners of 29.0%, 22.1% and 28.7%, during the year, respectively, which includes $262.2 million of foreign exchange depreciation across the segment,

o

$12.5 billion of market appreciation in our Real Estate segment driven by carrying value increases in opportunistic and Core+ real estate of 14.9% and 9.0%, during the year, respectively, which includes $1.2 billion of foreign exchange depreciation across the segment,

o

$5.9 billion of market appreciation in our Credit & Insurance segment driven by appreciation of $3.1 billion from certain liquid credit and MLP strategies, $715.7 million from mezzanine funds, $908.8 million from direct lending, $596.1 million from stressed/distressed strategies and $534.5 million from energy strategies, all of which included $115.5 million of foreign exchange appreciation across the segment, and

o

$4.9 billion of market appreciation in our Hedge Fund Solutions segment driven by reasons noted above in Fee-Earning Assets Under Management.

•

Realizations of $34.5 billion primarily driven by:

o

$16.7 billion in our Private Equity segment driven by $7.8 billion from corporate private equity, $4.2 billion from Strategic Partners, $4.1 billion from Tactical Opportunities, $278.6 million from BXG, $162.3 million from BIP and $151.2 million from BXLS,

o

$10.0 billion in our Credit & Insurance segment driven by $2.9 billion from CLOs, $2.7 billion from direct lending, $1.9 billion from mezzanine funds, $1.6 billion from stressed/distressed strategies, $573.1 million from energy strategies and $347.5 million from certain liquid credit and MLP strategies, and

o

$7.3 billion in our Real Estate segment driven by $4.9 billion from BREP opportunistic and co-investment, $1.5 billion from Core+ real estate and $845.3 million from BREDS.

---

•

Outflows of $21.6 billion primarily attributable to:

o

$8.9 billion in our Hedge Fund Solutions segment driven by $5.6 billion from customized solutions, $1.8 billion from individual investor and specialized solutions and $1.5 billion from commingled products,

o

$8.5 billion in our Credit & Insurance segment driven by $4.0 billion from certain liquid credit and MLP strategies, $2.6 billion from BIS, $588.7 million from direct lending, $587.0 million from CLOs, $213.9 million from stressed/distressed strategies, $141.4 million from our structured products group and $106.3 million from energy strategies,

o

$2.4 billion in our Real Estate segment driven by $1.3 billion from Core+ real estate, $738.8 million from BREDS and $365.0 million from BREP opportunistic funds and co-investment, and

o

$1.8 billion in our Private Equity segment driven by $845.1 million from Tactical Opportunities, $390.1 million from Strategic Partners, $281.5 million from multi-asset products and $160.0 million from corporate private equity.

Note:

Totals may not add due to rounding.

(a)

Represents illiquid drawdown funds, a component of Perpetual Capital and fee-paying co-investments; includes fee-paying third party capital as well as general partner and employee capital that does not earn fees. Amounts are reduced by outstanding capital commitments, for which capital has not yet been invested.

---

		June 30,
		2021				2020
		(Dollars in Millions)
Real Estate
BREP IV		$	19			$	7
BREP V			26				1
BREP VI			42				45
BREP VII			300				238
BREP VIII			626				604
BREP IX			359				6
BREP Europe IV			89				105
BREP Europe V			312				99
BREP Europe VI			60				—
BREP Asia I			107				85
BREP Asia II			98				—
BPP			265				225
BREIT			247				—
BREDS			32				3
BTAS			6				22
Total Real Estate (a)			2,591				1,441
Private Equity
BCP IV			9				19
BCP V			39				—
BCP VI			740				521
BCP VII			1,351				307
BCP VIII			89				—
BCP Asia I			213				18
BEP I			28				63
BEP III			47				3
BCEP I			170				43
Tactical Opportunities (b)			432				55
Strategic Partners			262				155
BIP			81				—
BXLS			23				8
BTAS/Other			151				7
Total Private Equity (a)			3,637				1,199
Hedge Fund Solutions			300				26
Credit & Insurance			233				42
Total Blackstone Net Accrued Performance Revenues		$	6,761			$	2,708

Note:

Totals may not add due to rounding.

(a)	Real Estate and Private Equity include co-investments, as applicable.

(b)	Tactical Opportunities includes Blackstone Growth.

---

Note:

Totals may not add due to rounding.

---

Note:

Totals may not add due to rounding.

---

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Real Estate
Pre-BREP		$       140,714		$                 —		$                —			n/a				—			$         345,190			2.5x			$         345,190			2.5x				33	%			33	%
BREP I (Sep 1994 / Oct 1996)		380,708		—		—			n/a				—			1,327,708			2.8x			1,327,708			2.8x				40	%			40	%
BREP II (Oct 1996 / Mar 1999)		1,198,339		—		—			n/a				—			2,531,614			2.1x			2,531,614			2.1x				19	%			19	%
BREP III (Apr 1999 / Apr 2003)		1,522,708		—		—			n/a				—			3,330,406			2.4x			3,330,406			2.4x				21	%			21	%
BREP IV (Apr 2003 / Dec 2005)		2,198,694		—		67,097			1.3x				56	%		4,579,740			1.7x			4,646,837			1.7x				13	%			12	%
BREP V (Dec 2005 / Feb 2007)		5,539,418		231,857		255,300			1.1x				58	%		13,090,349			2.4x			13,345,649			2.3x				12	%			11	%
BREP VI (Feb 2007 / Aug 2011)		11,060,444		550,596		493,096			2.3x				77	%		27,272,291			2.5x			27,765,387			2.5x				13	%			13	%
BREP VII (Aug 2011 / Apr 2015)		13,496,823		1,525,932		5,918,553			1.3x				6	%		23,280,621			2.1x			29,199,174			1.9x				22	%			14	%
BREP VIII (Apr 2015 / Jun 2019)		16,576,617		2,571,042		14,572,997			1.3x				—			14,848,690			2.4x			29,421,687			1.7x				29	%			15	%
*BREP IX (Jun 2019 / Dec 2024)		21,007,890		11,839,168		12,675,878			1.4x				7	%		1,585,131			1.7x			14,261,009			1.4x				n/m				29	%
Total Global BREP		$   73,122,355		$  16,718,595		$  33,982,921			1.4x				6	%		$  92,191,740			2.3x			$  126,174,661			1.9x				18	%			16	%
BREP Int’l (Jan 2001 / Sep 2005)		€         824,172		€                   —		€                   —			n/a				—			€     1,373,170			2.1x			€       1,373,170			2.1x				23	%			23	%
BREP Int’l II (Sep 2005 / Jun 2008) (e)		1,629,748		—		—			n/a				—			2,576,670			1.8x			2,576,670			1.8x				8	%			8	%
BREP Europe III (Jun 2008 / Sep 2013)		3,205,167		460,260		339,108			0.5x				—			5,738,120			2.5x			6,077,228			2.1x				20	%			14	%
BREP Europe IV (Sep 2013 / Dec 2016)		6,675,950		1,328,875		2,226,614			1.4x				—			9,238,374			1.9x			11,464,988			1.8x				20	%			14	%
BREP Europe V (Dec 2016 / Oct 2019)		7,937,730		1,579,708		8,147,321			1.4x				—			1,530,272			2.5x			9,677,593			1.5x				41	%			11	%
*BREP Europe VI (Oct 2019 / Apr 2025)		9,835,049		6,410,782		3,935,114			1.2x				2	%		9,200			n/a			3,944,314			1.2x				n/m				13	%
Total BREP Europe		€   30,107,816		€     9,779,625		€   14,648,157			1.3x				1	%		€   20,465,806			2.1x			€     35,113,963			1.7x				16	%			12	%

---

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Real Estate (continued)
BREP Asia I (Jun 2013 / Dec 2017)		$      4,261,983		$       916,901		$    2,505,476			1.4x				17	%		$      5,788,923			2.1x			$       8,294,399			1.8x				21	%			13	%
*BREP Asia II (Dec 2017 / Jun 2023)		7,349,172		3,091,837		5,381,616			1.3x				5	%		491,184			1.7x			5,872,800			1.3x				55	%			11	%
BREP Co-Investment (f)		7,055,974		32,158		670,425			1.6x				1	%		14,812,488			2.2x			15,482,913			2.2x				16	%			16	%
Total BREP		$  127,579,181		$  32,356,170		$  59,378,266			1.3x				5	%		$  138,957,222			2.2x			$  198,335,488			1.9x				17	%			15	%
*Core+ BPP (Various) (g)		$                  n/a		$                n/a		$  48,143,297			n/a				—			$      8,480,471			n/a			$    56,623,768			n/a				n/a				9	%
*Core+ BREIT (Various) (h)		n/a		n/a		31,518,967			n/a				—			1,008,038			n/a			32,527,005			n/a				n/a				11	%
*BREDS High-Yield (Various) (i)		19,991,125		7,767,589		5,179,211			1.1x				—			13,732,462			1.3x			18,911,673			1.2x				11	%			10	%
Private Equity
Corporate Private Equity
BCP I (Oct 1987 / Oct 1993)		$         859,081		$                 —		$                 —			n/a				—			$      1,741,738			2.6x			$      1,741,738			2.6x				19	%			19	%
BCP II (Oct 1993 / Aug 1997)		1,361,100		—		—			n/a				—			3,256,819			2.5x			3,256,819			2.5x				32	%			32	%
BCP III (Aug 1997 / Nov 2002)		3,967,422		—		—			n/a				—			9,184,688			2.3x			9,184,688			2.3x				14	%			14	%
BCOM (Jun 2000 / Jun 2006)		2,137,330		24,575		16,589			n/a				—			2,953,649			1.4x			2,970,238			1.4x				6	%			6	%
BCP IV (Nov 2002 / Dec 2005)		6,773,182		179,524		118,662			1.3x				—			21,478,010			2.9x			21,596,672			2.8x				36	%			36	%
BCP V (Dec 2005 / Jan 2011)		21,009,112		1,035,259		553,720			37.5x				98	%		37,876,327			1.9x			38,430,047			1.9x				8	%			8	%
BCP VI (Jan 2011 / May 2016)		15,202,246		1,164,816		11,003,889			2.0x				52	%		20,142,109			2.1x			31,145,998			2.1x				17	%			13	%
BCP VII (May 2016 / Feb 2020)		18,846,349		1,622,124		27,335,958			1.8x				34	%		5,130,267			1.9x			32,466,225			1.8x				29	%			21	%
*BCP VIII (Feb 2020 / Feb 2026)		24,884,732		21,948,631		4,226,476			1.5x				6	%		—			n/a			4,226,476			1.5x				n/a				n/m
Energy I (Aug 2011 / Feb 2015)		2,441,558		142,138		728,983			1.4x				64	%		3,618,876			1.9x			4,347,859			1.8x				14	%			11	%
Energy II (Feb 2015 / Feb 2020)		4,914,647		833,132		4,214,573			1.3x				20	%		1,197,747			0.9x			5,412,320			1.2x				-8	%			2	%
*Energy III (Feb 2020 / Feb 2026)		4,257,011		3,679,798		1,091,715			2.1x				75	%		238,516			2.0x			1,330,231			2.0x				94	%			95	%
*BCP Asia I (Dec 2017 / Dec 2023)		2,414,503		1,370,026		3,079,369			3.1x				58	%		603,472			4.8x			3,682,841			3.3x				97	%			65	%
BCP Asia II (TBD)		5,243,475		5,243,475		—			n/a				—			—			n/a			—			n/a				n/a				n/a
Core Private Equity I (Jan 2017 / Mar 2021) (j)		4,756,020		1,076,792		7,024,913			1.8x				—			1,284,639			2.3x			8,309,552			1.9x				31	%			25	%
*Core Private Equity II (Mar 2021 / Mar 2026) (j)		8,165,403		8,156,099		(4,266)			n/a				—			—			n/a			(4,266)			n/a				n/a				n/a
Total Corporate Private Equity		$  127,233,171		$  46,476,389		$  59,390,581			1.8x				33	%		$  108,706,857			2.1x			$  168,097,438			2.0x				16	%			15	%

---

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Private Equity (continued)
Tactical Opportunities
*Tactical Opportunities (Various)		$   22,862,522		$    7,088,393		$  14,979,562			1.5x				20	%		$ 14,307,619			1.8x			$ 29,287,181			1.6x				17	%			13	%
*Tactical Opportunities Co-Investment and Other (Various)		9,238,885		1,445,766		4,253,052			1.4x				6	%		6,072,437			1.6x			10,325,489			1.5x				20	%			16	%
Total Tactical Opportunities		$   32,101,407		$    8,534,159		$  19,232,614			1.5x				17	%		$  20,380,056			1.7x			$ 39,612,670			1.6x				18	%			14	%
*Blackstone Growth (Jul 2020 / Jul 2025)		$     4,761,851		$    3,500,609		$    2,101,698			1.6x				46	%		$       220,087			3.8x			$   2,321,785			1.7x				n/m				n/m
Strategic Partners (Secondaries)
Strategic Partners I-V (Various) (k)		11,863,351		1,047,300		722,607			n/m				—			17,234,545			n/m			17,957,152			1.6x				n/a				13	%
Strategic Partners VI (Apr 2014 / Apr 2016) (k)		4,362,750		1,316,363		1,278,661			n/m				—			3,596,948			n/m			4,875,609			1.5x				n/a				15	%
Strategic Partners VII (May 2016 / Mar 2019) (k)		7,489,970		2,049,841		5,268,290			n/m				—			3,509,459			n/m			8,777,749			1.6x				n/a				20	%
Strategic Partners Real Assets II (May 2017 / Jun 2020) (k)		1,749,807		379,942		1,047,927			n/m				—			535,504			n/m			1,583,431			1.2x				n/a				12	%
*Strategic Partners VIII (Mar 2019 / Jul 2023) (k)		10,763,600		5,454,255		5,691,944			n/m				—			1,991,266			n/m			7,683,210			1.5x				n/a				44	%
*Strategic Partners Real Estate, SMA and Other (Various) (k)		7,878,498		2,537,778		2,999,839			n/m				—			2,015,737			n/m			5,015,576			1.3x				n/a				15	%
*Strategic Partners Infra III (Jun 2020 / Jul 2024) (k)		3,250,100		2,627,042		101,030			n/m				—			14,819			n/a			115,849			1.7x				n/a				n/m
Total Strategic Partners (Secondaries)		$  47,358,076		$ 15,412,521		$  17,110,298			n/m				—			$ 28,898,278			n/m			$ 46,008,576			1.5x				n/a				15	%
*Infrastructure (Various)		$  13,658,063		$   9,103,132		$    6,168,496			1.4x				49	%		$                 —			n/a			$   6,168,496			1.4x				n/a				20	%
Life Sciences
Clarus IV (Jan 2018 / Jan 2020)		910,000		275,501		821,098			1.5x				5	%		34,970			0.8x			856,068			1.5x				-27	%			16	%
*BXLS V (Jan 2020 / Jan 2025)		4,772,543		4,124,567		822,115			1.4x				15	%		—			n/a			822,115			1.4x				n/a				n/m

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						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Credit
Mezzanine / Opportunistic I (Jul 2007 / Oct 2011)		$       2,000,000		$         97,114		$         20,784			1.1x				—			$    4,775,786			1.6x			$     4,796,570			1.6x				n/a				17	%
Mezzanine / Opportunistic II (Nov 2011 / Nov 2016)		4,120,000		1,013,932		876,247			0.6x				—			5,787,118			1.6x			6,663,365			1.3x				n/a				10	%
Mezzanine / Opportunistic III (Sep 2016 / Jan 2021)		6,639,133		1,073,044		5,120,278			1.1x				—			3,756,163			1.7x			8,876,441			1.3x				n/a				11	%
*Mezzanine / Opportunistic IV (Jan 2021 / Jan 2026)		3,738,771		3,304,044		444,960			1.0x				—			5,321			n/a			450,281			1.0x				n/a				n/a
Stressed / Distressed I (Sep 2009 / May 2013)		3,253,143		76,000		—			n/a				—			5,776,922			1.3x			5,776,922			1.3x				n/a				9	%
Stressed / Distressed II (Jun 2013 / Jun 2018)		5,125,000		547,430		642,546			0.7x				—			4,956,906			1.2x			5,599,452			1.1x				n/a				1	%
*Stressed / Distressed III (Dec 2017 / Dec 2022)		7,356,380		3,665,909		2,142,557			1.0x				—			2,002,481			1.4x			4,145,038			1.1x				n/a				8	%
Energy I (Nov 2015 / Nov 2018)		2,856,867		1,003,583		1,437,797			1.0x				—			1,523,775			1.6x			2,961,572			1.3x				n/a				8	%
*Energy II (Feb 2019 / Feb 2024)		3,616,081		2,639,556		1,109,599			1.1x				—			338,649			1.7x			1,448,248			1.2x				n/a				27	%
European Senior Debt I (Feb 2015 / Feb 2019)		€     1,964,689		€        262,076		€     1,403,591			1.0x				—			€     1,824,750			1.4x			€     3,228,341			1.2x				n/a				6	%
*European Senior Debt II (Jun 2019 / Jun 2024)		€     4,088,344		€     3,344,258		€     1,777,997			1.0x				—			€        581,142			1.2x			€     2,359,139			1.1x				n/a				19	%
Total Credit Drawdown Funds (l)		$  45,611,033		$  17,697,364		$  15,567,813			1.0x				—			$  31,707,914			1.4x			$  47,275,727			1.3x				n/a				10	%
*Direct Lending BDC (Various) (m)		$    3,926,295		$       356,250		$    3,741,102			n/a				—			$       379,307			n/a			$    4,120,409			n/a				n/a				10	%

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n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

SMA	Separately managed account.

*	Represents funds that are currently in their investment period and open-ended funds.

(a)	Excludes investment vehicles where Blackstone does not earn fees.

(b)	Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital and may include leverage, less invested capital. This amount is not reduced by outstanding commitments to investments.

(c)	Multiple of Invested Capital (“MOIC”) represents carrying value, before management fees, expenses and Performance Revenues, divided by invested capital.

(d)

Unless otherwise indicated, Net Internal Rate of Return (“IRR”) represents the annualized inception to June 30, 2021 IRR on total invested capital based on realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues. IRRs are calculated using actual timing of limited partner cash flows. Initial inception date of cash flows may differ from the Investment Period Beginning Date.

(e)	The 8% Realized Net IRR and 8% Total Net IRR exclude investors that opted out of the Hilton investment opportunity. Overall BREP International II performance reflects a 7% Realized Net IRR and a 7% Total Net IRR.

(f)	BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues.

(g)	BPP represents the Core+ real estate funds which invest with a more modest risk profile and lower leverage. Committed Capital and Available Capital are not regularly reported to investors in our Core+ strategy and are not applicable in the context of these funds.

(h)

Unrealized Investment Value reflects BREIT’s net asset value as of June 30, 2021. Realized Investment Value represents BREIT’s cash distributions, net of servicing fees. The BREIT net return reflects a per share blended return, assuming BREIT had a single share class, reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BREIT. These returns are not representative of the returns experienced by any particular investor or share class. Inception to date net returns are presented on an annualized basis and are from January 1, 2017. Committed Capital and Available Capital are not regularly reported to investors in our Core+ strategy and are not applicable in the context of this vehicle.

(i)	BREDS High-Yield represents the flagship real estate debt drawdown funds only and excludes BREDS High-Grade.

(j)	Blackstone Core Equity Partners is a core private equity strategy which invests with a more modest risk profile and longer hold period than traditional private equity.

(k)

Realizations are treated as return of capital until fully recovered and therefore unrealized and realized MOICs are not meaningful. If information is not available on a timely basis, returns are calculated from results that are reported on a three month lag and therefore do not include the impact of economic and market activities in the quarter in which such events occur.

(l)	Funds presented represent the flagship credit drawdown funds only. The Total Credit Net IRR is the combined IRR of the credit drawdown funds presented.

(m)

Unrealized Investment Value reflects BXSL’s net asset value as of June 30, 2021. Realized Investment Value represents BXSL’s cash distributions. BXSL’s net return is annualized and calculated since inception starting on November 20, 2018, as the change in net asset value (“NAV”) per share during the period, plus distributions per share (assuming dividends and distributions are reinvested in accordance with the Company’s dividend reinvestment plan) divided by the beginning NAV per share.

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		Three Months Ended																Six Months Ended
		June 30,								2021 vs. 2020								June 30,								2021 vs. 2020
		2021				2020				$				%				2021				2020				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	453,664			$	382,704			$	70,960				19	%		$	880,850			$	754,142			$	126,708				17	%
Transaction and Other Fees, Net			38,080				32,039				6,041				19	%			64,099				55,063				9,036				16	%
Management Fee Offsets			(493	)			(2,436	)			1,943				-80	%			(2,116	)			(10,777	)			8,661				-80	%
Total Management Fees, Net			491,251				412,307				78,944				19	%			942,833				798,428				144,405				18	%
Fee Related Performance Revenues			33,776				6,505				27,271				419	%			189,168				11,056				178,112				n/	m
Fee Related Compensation			(121,957	)			(116,640	)			(5,317	)			5	%			(310,449	)			(236,936	)			(73,513	)			31	%
Other Operating Expenses			(54,760	)			(44,525	)			(10,235	)			23	%			(99,122	)			(85,001	)			(14,121	)			17	%
Fee Related Earnings			348,310				257,647				90,663				35	%			722,430				487,547				234,883				48	%
Realized Performance Revenues			351,053				34,209				316,844				926	%			439,691				77,929				361,762				464	%
Realized Performance Compensation			(154,928	)			(12,547	)			(142,381	)			n/	m			(177,690	)			(25,939	)			(151,751	)			585	%
Realized Principal Investment Income			28,129				1,573				26,556				n/	m			128,949				8,873				120,076				n/	m
Net Realizations			224,254				23,235				201,019				865	%			390,950				60,863				330,087				542	%
Segment Distributable Earnings		$	572,564			$	280,882			$	291,682				104	%		$	1,113,380			$	548,410			$	564,970				103	%

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		Three Months Ended																Six Months Ended																June 30, 2021
		June 30,																June 30,																Inception to Date
		2021								2020								2021								2020								Realized								Total
Fund (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BREP VII			7%				6%				-9%				-8%				11%				9%				-22%				-20%				30%				22%				21%				14%
BREP VIII			12%				10%				4%				3%				17%				13%				-4%				-3%				36%				29%				21%				15%
BREP IX			17%				13%				10%				9%				27%				20%				8%				3%				n/m				n/m				44%				29%
BREP Europe IV (b)			-1%				-1%				-5%				-5%				-1%				-1%				-13%				-12%				29%				20%				20%				14%
BREP Europe V (b)			6%				5%				1%				1%				10%				8%				-7%				-6%				52%				41%				16%				11%
BREP Europe VI (b)			11%				8%				n/m				n/m				19%				13%				n/m				n/m				n/m				n/m				25%				13%
BREP Asia I			5%				4%				-				-				20%				16%				-15%				-13%				29%				21%				19%				13%
BREP Asia II			4%				3%				3%				2%				16%				10%				-6%				-7%				81%				55%				20%				11%
BREP Co-Investment (c)			17%				17%				16%				15%				24%				22%				13%				13%				18%				16%				18%				16%
BPP (d)			4%				4%				2%				2%				6%				5%				-				-				n/a				n/a				11%				9%
BREIT (e)			n/a				7%				n/a				4%				n/a				12%				n/a				-4%				n/a				n/a				n/a				11%
BREDS High-Yield (f)			4%				3%				5%				4%				9%				7%				-7%				-7%				15%				11%				15%				10%
BREDS Liquid (g)			3%				2%				3%				3%				9%				8%				-19%				-19%				n/a				n/a				9%				7%
BXMT (h)			n/a				5%				n/a				33%				n/a				20%				n/a				-32%				n/a				n/a				n/a				11%

n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Revenues.

(b)	Euro-based internal rates of return.

(c)	BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues.

(d)	BPP represents the Core+ real estate funds which invest with a more modest risk profile and lower leverage.

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(e)

Reflects a per share blended return for each respective period, assuming BREIT had a single share class, reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BREIT. These returns are not representative of the returns experienced by any particular investor or share class. Inception to date returns are presented on an annualized basis and are from January 1, 2017.

(f)	BREDS High-Yield represents the flagship real estate debt drawdown funds and excludes the BREDS High-Grade drawdown fund, which has a different risk-return profile. Inception to date returns are from July 1, 2009.

(g)

BREDS Liquid represents BREDS funds that invest in liquid real estate debt securities, except funds in liquidation and insurance mandates with specific investment objectives. The returns presented represent summarized asset-weighted gross and net rates of return from August 1, 2008. Inception to Date returns are presented on an annualized basis.

(h)

Reflects annualized return of a shareholder invested in BXMT as of the beginning of each period presented, assuming reinvestment of all dividends received during the period, and net of all fees and expenses incurred by BXMT. Return incorporates the closing NYSE stock price as of each period end. Inception to date returns are from May 22, 2013.

		Three Months Ended																Six Months Ended
		June 30,								2021 vs. 2020								June 30,								2021 vs. 2020
		2021				2020				$				%				2021				2020				$				%
		(Dollars in Thousands)
Management and Advisory Fees, Net
Base Management Fees		$	364,606			$	268,070			$	96,536				36	%		$	742,266			$	522,044			$	220,222				42	%
Transaction, Advisory and Other Fees, Net			32,272				9,521				22,751				239	%			74,979				30,934				44,045				142	%
Management Fee Offsets			(3,601	)			(8,031	)			4,430				-55	%			(17,520	)			(17,246	)			(274	)			2	%
Total Management and Advisory Fees, Net			393,277				269,560				123,717				46	%			799,725				535,732				263,993				49	%
Fee Related Compensation			(136,767	)			(92,825	)			(43,942	)			47	%			(277,364	)			(203,193	)			(74,171	)			37	%
Other Operating Expenses			(61,041	)			(44,827	)			(16,214	)			36	%			(112,096	)			(85,828	)			(26,268	)			31	%
Fee Related Earnings			195,469				131,908				63,561				48	%			410,265				246,711				163,554				66	%
Realized Performance Revenues			383,010				64,513				318,497				494	%			638,855				176,589				462,266				262	%
Realized Performance Compensation			(159,375	)			(25,016	)			(134,359	)			537	%			(270,584	)			(79,659	)			(190,925	)			240	%
Realized Principal Investment Income			27,796				17,416				10,380				60	%			143,199				27,763				115,436				416	%
Net Realizations			251,431				56,913				194,518				342	%			511,470				124,693				386,777				310	%
Segment Distributable Earnings		$	446,900			$	188,821			$	258,079				137	%		$	921,735			$	371,404			$	550,331				148	%

n/m	Not meaningful.

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		Three Months Ended																Six Months Ended																June 30, 2021
		June 30,																June 30,																Inception to Date
		2021								2020								2021								2020								Realized								Total
Fund (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BCP V			3%				1%				15%				3%				148%				69%				-15%				-7%				10%				8%				10%				8%
BCP VI			4%				4%				27%				22%				15%				13%				-10%				-9%				22%				17%				17%				13%
BCP VII			14%				12%				6%				4%				29%				23%				-7%				-7%				41%				29%				29%				21%
BEP I			13%				10%				47%				34%				53%				42%				-22%				-20%				18%				14%				14%				11%
BEP II			15%				14%				13%				13%				40%				38%				-38%				-38%				-3%				-8%				6%				2%
BEP III			24%				14%				n/m				n/m				59%				40%				n/m				n/m				138%				94%				173%				95%
BCP Asia I			60%				52%				4%				3%				88%				75%				3%				1%				209%				97%				90%				65%
BCEP I (b)			11%				10%				4%				4%				29%				27%				-2%				-2%				42%				31%				28%				25%
Tactical Opportunities			8%				6%				12%				9%				27%				21%				-9%				-5%				21%				17%				18%				13%
Tactical Opportunities Co-Investment and Other			7%				6%				9%				9%				21%				18%				-				-				20%				20%				19%				16%
Strategic Partners I-V (c)			11%				10%				1%				1%				18%				15%				3%				3%				n/a				n/a				16%				13%
Strategic Partners VI (c)			16%				15%				-				-				27%				24%				-1%				-2%				n/a				n/a				19%				15%
Strategic Partners VII (c)			20%				19%				3%				3%				34%				31%				3%				2%				n/a				n/a				24%				20%
Strategic Partners Real Assets II (c)			5%				4%				4%				4%				7%				6%				8%				7%				n/a				n/a				16%				12%
Strategic Partners VIII (c)			24%				22%				8%				5%				49%				41%				12%				9%				n/a				n/a				58%				44%
Strategic Partners RE, SMA and Other (c)			7%				7%				5%				5%				14%				14%				7%				7%				n/a				n/a				17%				15%
BIP			13%				12%				3%				3%				39%				32%				-9%				-10%				n/a				n/a				28%				20%
Clarus IV			5%				4%				-				-				18%				14%				2%				1%				-19%				-27%				28%				16%

n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

SMA	Separately managed account.

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Revenues.

(b)	BCEP is a core private equity strategy which invests with a more modest risk profile and longer hold period than traditional private equity.

(c)

Realizations are treated as return of capital until fully recovered and therefore inception to date realized returns are not applicable. If information is not available on a timely basis, returns are calculated from results that are reported on a three month lag and therefore do not include the impact of economic and market activities in the quarter in which such events occur.

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		Three Months Ended																Six Months Ended
		June 30,								2021 vs. 2020								June 30,								2021 vs. 2020
		2021				2020				$				%				2021				2020				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	155,244			$	145,455			$	9,789				7%			$	305,777			$	285,111			$	20,666				7%
Transaction and Other Fees, Net			1,558				859				699				81%				5,904				1,617				4,287				265%
Management Fee Offsets			(203	)			4				(207	)			n/m				(261	)			(38	)			(223	)			587%
Total Management Fees, Net			156,599				146,318				10,281				7%				311,420				286,690				24,730				9%
Fee Related Compensation			(38,638	)			(40,353	)			1,715				-4%				(77,488	)			(86,544	)			9,056				-10%
Other Operating Expenses			(21,873	)			(17,807	)			(4,066	)			23%				(41,045	)			(36,474	)			(4,571	)			13%
Fee Related Earnings			96,088				88,158				7,930				9%				192,887				163,672				29,215				18%
Realized Performance Revenues			17,056				1,482				15,574				n/m				48,629				3,249				45,380				n/m
Realized Performance Compensation			(5,626	)			—				(5,626	)			n/m				(12,534	)			(945	)			(11,589	)			n/m
Realized Principal Investment Income (Loss)			2,125				(331	)			2,456				n/m				37,675				(940	)			38,615				n/m
Net Realizations			13,555				1,151				12,404				n/m				73,770				1,364				72,406				n/m
Segment Distributable Earnings		$	109,643			$	89,309			$	20,334				23%			$	266,657			$	165,036			$	101,621				62%

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		Three																Six																Average Annual Returns (a)
		Months Ended																Months Ended																Periods Ended
		June 30,																June 30,																June 30, 2021
		2021								2020								2021								2020								One Year								Three Year								Five Year								Historical
Composite		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BAAM Principal Solutions Composite (b)			3	%			3	%			6	%			6	%			6	%			5	%			-3	%			-3	%			15	%			14	%			6	%			5	%			7	%			6	%			7	%			6	%

(a)	Composite returns present a summarized asset-weighted return measure to evaluate the overall performance of the applicable class of Blackstone Funds.

(b)

BAAM’s Principal Solutions (“BPS”) Composite covers the period from January 2000 to present, although BAAM’s inception date is September 1990. The BPS Composite includes only BAAM-managed commingled and customized multi-manager funds and accounts and does not include BAAM’s individual investor solutions (liquid alternatives), strategic capital (seeding and GP minority stakes), strategic opportunities (co-invests), and advisory (non-discretionary) platforms, except for investments by BPS funds directly into those platforms. BAAM-managed funds in liquidation and, in the case of net returns, non-fee-paying assets are also excluded. The funds/accounts that comprise the BPS Composite are not managed within a single fund or account and are managed with different mandates. There is no guarantee that BAAM would have made the same mix of investments in a stand-alone fund/account. The BPS Composite is not an investible product and, as such, the performance of the BPS Composite does not represent the performance of an actual fund or account. The historical return is from January 1, 2000.

		Invested Performance								Estimated % Above
		Eligible Assets Under								High Water Mark/
		Management								Benchmark (a)
		As of June 30,								As of June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
Hedge Fund Solutions Managed Funds (b)		$	44,660,713			$	43,933,866				93	%			21	%

(a)

Estimated % Above High Water Mark/Benchmark represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Hedge Fund Solutions managed fund has positive investment performance relative to a benchmark, where applicable. Incremental positive performance in the applicable Blackstone Funds may cause additional assets to reach their respective High Water Mark or clear a benchmark return, thereby resulting in an increase in Estimated % Above High Water Mark/Benchmark.

(b)

For the Hedge Fund Solutions managed funds, at June 30, 2021, the incremental appreciation needed for the 7% of Invested Performance Eligible Assets Under Management below their respective High Water Marks/Benchmarks to reach their respective High Water Marks/Benchmarks was $261.5 million, a decrease of $(2.2) billion, compared to $2.5 billion at June 30, 2020. Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/Benchmarks as of June 30, 2021, 55% were within 5% of reaching their respective High Water Mark.

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		Three Months Ended																Six Months Ended
		June 30,								2021 vs. 2020								June 30,								2021 vs. 2020
		2021				2020				$				%				2021				2020				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	166,537			$	145,565			$	20,972				14%			$	328,448			$	290,893			$	37,555				13%
Transaction and Other Fees, Net			6,215				5,873				342				6%				11,783				11,343				440				4%
Management Fee Offsets			(1,137	)			(2,890	)			1,753				-61%				(3,262	)			(5,786	)			2,524				-44%
Total Management Fees, Net			171,615				148,548				23,067				16%				336,969				296,450				40,519				14%
Fee Related Performance Revenues			15,113				8,528				6,585				77%				28,889				16,443				12,446				76%
Fee Related Compensation			(78,023	)			(57,086	)			(20,937	)			37%				(155,194	)			(126,495	)			(28,699	)			23%
Other Operating Expenses			(44,504	)			(36,424	)			(8,080	)			22%				(91,339	)			(75,165	)			(16,174	)			22%
Fee Related Earnings			64,201				63,566				635				1%				119,325				111,233				8,092				7%
Realized Performance Revenues			41,819				1,973				39,846				n/m				67,086				11,643				55,443				476%
Realized Performance Compensation			(18,342	)			(224	)			(18,118	)			n/m				(28,387	)			(2,546	)			(25,841	)			n/m
Realized Principal Investment Income			5,082				280				4,802				n/m				51,465				3,532				47,933				n/m
Net Realizations			28,559				2,029				26,530				n/m				90,164				12,629				77,535				614%
Segment Distributable Earnings		$	92,760			$	65,595			$	27,165				41%			$	209,489			$	123,862			$	85,627				69%

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		Three Months Ended June 30,																Six Months Ended June 30,																June 30, 2021
		2021								2020								2021								2020								Inception to Date
Composite (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
Private Credit (b)			5	%			4	%			11	%			9	%			12	%			10	%			-14	%			-12	%			11	%			7	%
Liquid Credit (b)			2	%			2	%			10	%			10	%			3	%			3	%			-3	%			-3	%			5	%			5	%

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Allocations, net of tax advances.

(b)

Effective January 1, 2021, Credit returns are presented as separate returns for Private Credit and Liquid Credit instead of as a Credit Composite. Private Credit returns include mezzanine lending funds and middle market direct lending funds (including BXSL), stressed/distressed strategies (including stressed/distressed funds and credit alpha strategies) and energy strategies. Liquid Credit returns include CLOs, closed-ended funds, open-ended funds and separately managed accounts. Only fee-earning funds exceeding $100 million of fair value at the beginning of each respective quarter-end are included. Funds in liquidation, funds investing primarily in investment grade corporate credit and our structured products group are excluded. Blackstone Funds that were contributed to BXC as part of Blackstone’s acquisition of BXC in March 2008 and the pre-acquisition date performance for funds and vehicles acquired by BXC subsequent to March 2008, are also excluded. Private Credit and Liquid Credit’s inception to date returns are from December 31, 2005. Prior periods have been updated to reflect this presentation.

		Invested Performance Eligible Assets Under Management								Estimated % Above High Water Mark/ Hurdle (a)
		As of June 30,								As of June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
Credit & Insurance (b)		$	42,210,582			$	24,731,100				76	%			41	%

(a)

Estimated % Above High Water Mark/Hurdle represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Credit & Insurance managed fund has positive investment performance relative to a hurdle, where applicable. Incremental positive performance in the applicable Blackstone Funds may cause additional assets to reach their respective High Water Mark or clear a hurdle return, thereby resulting in an increase in Estimated % Above High Water Mark/Hurdle.

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(b)

For the Credit & Insurance managed funds, at June 30, 2021, the incremental appreciation needed for the 24% of Invested Performance Eligible Assets Under Management below their respective High Water Marks/Hurdles to reach their respective High Water Marks/Hurdles was $2.4 billion, a decrease of $(2.1) billion, compared to $4.5 billion at June 30, 2020. Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/Hurdles as of June 30, 2021, 58% were within 5% of reaching their respective High Water Mark.

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		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
Net Income (Loss) Attributable to The Blackstone Group Inc.		$	1,309,152			$	568,266			$	3,057,024			$	(498,226	)
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			1,116,193				495,128				2,351,977				(384,989	)
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			431,516				294,378				818,366				(350,699	)
Net Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			637				(3,426	)			1,266				(18,895	)
Net Income (Loss)			2,857,498				1,354,346				6,228,633				(1,252,809	)
Provision (Benefit) for Taxes			288,250				147,415				287,803				(11,288	)
Net Income (Loss) Before Provision (Benefit) for Taxes			3,145,748				1,501,761				6,516,436				(1,264,097	)
Transaction-Related Charges (a)			35,533				76,160				63,421				123,154
Amortization of Intangibles (b)			17,044				16,483				34,168				32,966
Impact of Consolidation (c)			(432,153	)			(290,952	)			(819,632	)			369,594
Unrealized Performance Revenues (d)			(2,697,170	)			(1,067,923	)			(5,161,667	)			2,385,523
Unrealized Performance Allocations Compensation (e)			1,150,219				454,813				2,200,188				(942,565	)
Unrealized Principal Investment (Income) Loss (f)			(104,658	)			(223,316	)			(528,592	)			393,294
Other Revenues (g)			(27,870	)			55,606				(88,143	)			(82,545	)
Equity-Based Compensation (h)			121,422				89,341				265,694				176,813
Administrative Fee Adjustment (i)			2,551				—				5,259				—
Taxes and Related Payables (j)			(140,673	)			(63,990	)			(224,895	)			(87,043	)
Distributable Earnings			1,069,993				547,983				2,262,237				1,105,094
Taxes and Related Payables (j)			140,673				63,990				224,895				87,043
Net Interest Loss (k)			11,201				12,634				24,129				16,575
Total Segment Distributable Earnings			1,221,867				624,607				2,511,261				1,208,712
Realized Performance Revenues (l)			(792,938	)			(102,177	)			(1,194,261	)			(269,410	)
Realized Performance Compensation (m)			338,271				37,787				489,195				109,089
Realized Principal Investment Income (n)			(63,132	)			(18,938	)			(361,288	)			(39,228	)
Fee Related Earnings		$	704,068			$	541,279			$	1,444,907			$	1,009,163
Adjusted EBITDA Reconciliation
Distributable Earnings		$	1,069,993			$	547,983			$	2,262,237			$	1,105,094
Interest Expense (o)			44,132				38,924				88,472				80,464
Taxes and Related Payables (j)			140,673				63,990				224,895				87,043
Depreciation and Amortization (p)			12,581				8,110				24,874				15,622
Adjusted EBITDA		$	1,267,379			$	659,007			$	2,600,478			$	1,288,223

(a)

This adjustment removes Transaction-Related Charges, which are excluded from Blackstone’s segment presentation. Transaction-Related Charges arise from corporate actions including acquisitions, divestitures, and Blackstone’s initial public offering. They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs and any gains or losses associated with these corporate actions.

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(b)

This adjustment removes the amortization of transaction-related intangibles, which are excluded from Blackstone’s segment presentation. This amount includes amortization of intangibles associated with Blackstone’s investment in Pátria, which was historically accounted for under the equity method. As a result of Pátria’s IPO in January 2021, equity method has been discontinued and there will no longer be amortization of intangibles associated with the investment.

(c)

This adjustment reverses the effect of consolidating Blackstone Funds, which are excluded from Blackstone’s segment presentation. This adjustment includes the elimination of Blackstone’s interest in these funds and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

(d)	This adjustment removes Unrealized Performance Revenues on a segment basis. The Segment Adjustment represents the add back of performance revenues earned from consolidated Blackstone Funds which have been eliminated in consolidation.

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
GAAP Unrealized Performance Allocations		$	2,697,170			$	1,067,923			$	5,161,667			$	(2,385,158	)
Segment Adjustment			—				—				—				(365	)
Unrealized Performance Revenues		$	2,697,170			$	1,067,923			$	5,161,667			$	(2,385,523	)

(e)	This adjustment removes Unrealized Performance Allocations Compensation.

(f)

This adjustment removes Unrealized Principal Investment Income (Loss) on a segment basis. The Segment Adjustment represents (1) the add back of Principal Investment Income, including general partner income, earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
GAAP Unrealized Principal Investment Income (Loss)		$	328,835			$	331,762			$	968,150			$	(627,603	)
Segment Adjustment			(224,177	)			(108,446	)			(439,558	)			234,309
Unrealized Principal Investment Income (Loss)		$	104,658			$	223,316			$	528,592			$	(393,294	)

(g)	This adjustment removes Other Revenues on a segment basis. The Segment Adjustment represents (1) the add back of Other Revenues earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of certain Transaction-Related Charges.

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
GAAP Other Revenue		$	27,896			$	(55,580	)		$	88,200			$	82,600
Segment Adjustment			(26	)			(26	)			(57	)			(55	)
Other Revenues		$	27,870			$	(55,606	)		$	88,143			$	82,545

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(h)	This adjustment removes Equity-Based Compensation on a segment basis.

(i)

This adjustment adds an amount equal to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units. The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.

(j)

Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes and adjusted to exclude the tax impact of any divestitures. Related Payables represent tax-related payables including the amount payable under the Tax Receivable Agreement. See “— Key Financial Measures and Indicators — Distributable Earnings” for the full definition of Taxes and Related Payables.

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
Taxes		$	127,809			$	48,462			$	197,418			$	64,736
Related Payables			12,864				15,528				27,477				22,307
Taxes and Related Payables		$	140,673			$	63,990			$	224,895			$	87,043

(k)

This adjustment removes Interest and Dividend Revenue less Interest Expense on a segment basis. The Segment Adjustment represents (1) the add back of Interest and Dividend Revenue earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of interest expense associated with the Tax Receivable Agreement.

		Three Months Ended June 30,								Six Months Ended June 30,
		2021				2020				2021				2020
		(Dollars in Thousands)
GAAP Interest and Dividend Revenue		$	31,017			$	23,924			$	62,429			$	59,008
Segment Adjustment			1,914				2,366				1,914				4,881
Interest and Dividend Revenue			32,931				26,290				64,343				63,889
GAAP Interest Expense			44,322				39,276				89,305				80,920
Segment Adjustment			(190	)			(352	)			(833	)			(456	)
Interest Expense			44,132				38,924				88,472				80,464
Net Interest Loss		$	(11,201	)		$	(12,634	)		$	(24,129	)		$	(16,575	)

(l)	This adjustment removes the total segment amount of Realized Performance Revenues.

(m)	This adjustment removes the total segment amount of Realized Performance Compensation.

(n)	This adjustment removes the total segment amount of Realized Principal Investment Income.

(o)	This adjustment adds back Interest Expense on a segment basis, excluding interest expense related to the Tax Receivable Agreement.

(p)	This adjustment adds back Depreciation and Amortization on a segment basis.

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		June 30,
		2021				2020
		(Dollars in Thousands)
Investments of Consolidated Blackstone Funds		$	1,871,269			$	7,943,531
Equity Method Investments
Partnership Investments			4,916,674				3,873,346
Accrued Performance Allocations			12,101,142				4,715,510
Corporate Treasury Investments			2,440,325				2,205,843
Other Investments			833,912				235,143
Total GAAP Investments		$	22,163,322			$	18,973,373
Accrued Performance Allocations - GAAP		$	12,101,142			$	4,715,510
Impact of Consolidation (a)			1				19
Due from Affiliates - GAAP (b)			59,304				20,642
Less: Net Realized Performance Revenues (c)			(261,760	)			(38,592	)
Less: Accrued Performance Compensation - GAAP (d)			(5,137,933	)			(1,989,219	)
Net Accrued Performance Revenues		$	6,760,754			$	2,708,360

(a)	This adjustment adds back investments in consolidated Blackstone Funds which have been eliminated in consolidation.

(b)	Represents GAAP accrued performance revenue recorded within Due from Affiliates.

(c)	Represents Performance Revenues realized but not yet distributed as of the reporting date and are included in Distributable Earnings in the period they are realized.

(d)	Represents GAAP accrued performance compensation associated with Accrued Performance Allocations and is recorded within Accrued Compensation and Benefits and Due to Affiliates.

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										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Real Estate
BREP V		$	52,545			$	2,185			$	—			$	—
BREP VI			750,000				36,809				150,000				12,270
BREP VII			300,000				33,652				100,000				11,217
BREP VIII			300,000				48,178				100,000				16,059
BREP IX			300,000				170,534				100,000				56,845
BREP Europe III			100,000				13,231				35,000				4,410
BREP Europe IV			130,000				24,074				43,333				8,025
BREP Europe V			150,000				32,040				43,333				9,256
BREP Europe VI			130,000				87,059				43,333				29,020
BREP Asia I			50,000				10,141				16,667				3,380
BREP Asia II			70,707				30,014				23,569				10,005
BREDS II			50,000				6,227				16,667				2,076
BREDS III			50,000				17,659				16,667				5,886
BREDS IV			50,000				33,366				—				—
BPP			176,306				30,315				—				—
Other (b)			25,599				11,557				—				—
Total Real Estate			2,685,157				587,041				688,569				168,449

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										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Private Equity
BCP V		$	629,356			$	30,642			$	—			$	—
BCP VI			719,718				82,838				250,000				28,774
BCP VII			500,000				43,119				225,000				19,404
BCP VIII			500,000				443,434				225,000				199,545
BEP I			50,000				4,728				—				—
BEP II			80,000				14,477				26,667				4,826
BEP III			80,000				69,421				26,667				23,140
BCEP I			120,000				27,062				18,992				4,283
BCEP II			160,000				160,000				32,640				32,640
BCP Asia I			40,000				22,860				13,333				7,620
BCP Asia II			100,000				100,000				33,333				33,333
Tactical Opportunities			420,577				164,315				140,192				54,772
Strategic Partners			777,368				453,280				120,214				69,072
BIP			168,632				91,577				—				—
BXLS			110,000				81,310				26,667				23,427
BXG			80,500				60,227				26,667				19,942
Other (b)			278,669				31,787				—				—
Total Private Equity			4,814,820				1,881,077				1,165,372				520,778
Hedge Fund Solutions
Strategic Alliance I			50,000				2,033				—				—
Strategic Alliance II			50,000				1,482				—				—
Strategic Alliance III			22,000				2,031				—				—
Strategic Alliance IV			15,000				15,000				—				—
Strategic Holdings I			154,610				53,330				—				—
Strategic Holdings II			50,000				40,157				—				—
Horizon			100,000				13,225				—				—
Other (b)			18,879				10,095				—				—
Total Hedge Fund Solutions			460,489				137,353				—				—

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										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Credit & Insurance
Mezzanine / Opportunistic II		$	120,000			$	29,458			$	110,101			$	27,028
Mezzanine / Opportunistic III			130,783				40,960				31,072				9,731
Mezzanine / Opportunistic IV			122,000				111,853				33,383				30,607
European Senior Debt I			63,000				16,521				56,882				14,917
European Senior Debt II			93,110				64,462				24,284				16,774
Stressed / Distressed I			50,000				4,869				27,666				2,694
Stressed / Distressed II			125,000				51,695				119,878				49,576
Stressed / Distressed III			151,000				113,042				31,989				23,948
Energy I			80,000				37,630				75,566				35,544
Energy II			150,000				129,739				25,565				22,112
Credit Alpha Fund			52,102				19,752				50,675				19,211
Credit Alpha Fund II			25,500				11,336				6,130				2,725
Other (b)			147,368				51,248				20,612				4,073
Total Credit & Insurance			1,309,863				682,565				613,803				258,940
Other
Treasury (c)			680,638				372,637				—				—
		$	9,950,967			$	3,660,673			$	2,467,744			$	948,167

(a)

For some of the general partner commitments shown in the table above, we require our senior managing directors and certain other professionals to fund a portion of the commitment even though the ultimate obligation to fund the aggregate commitment is ours pursuant to the governing agreements of the respective funds. The amounts of the aggregate applicable general partner original and remaining commitment are shown in the table above. In addition, certain senior managing directors and other professionals may be required to fund a de minimis amount of the commitment in certain carry funds. We expect our commitments to be drawn down over time and to be funded by available cash and cash generated from operations and realizations. Taking into account prevailing market conditions and both the liquidity and cash or liquid investment balances, we believe that the sources of liquidity described above will be more than sufficient to fund our working capital requirements.

(b)	Represents capital commitments to a number of other funds in each respective segment.

(c)	Represents loan origination commitments, revolver commitments and capital market commitments.

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		Aggregate
		Principal
		Amount
		(Dollars/Euros
Senior Notes (a)		in Thousands)
4.750%, Due 2/15/2023		$	400,000
2.000%, Due 5/19/2025		€	300,000
1.000%, Due 10/5/2026		€	600,000
3.150%, Due 10/2/2027		$	300,000
1.500%, Due 4/10/2029		€	600,000
2.500%, Due 1/10/2030		$	500,000
1.600%, Due 3/30/2031		$	500,000
6.250%, Due 8/15/2042		$	250,000
5.000%, Due 6/15/2044		$	500,000
4.450%, Due 7/15/2045		$	350,000
4.000%, Due 10/2/2047		$	300,000
3.500%, Due 9/10/2049		$	400,000
2.800%, Due 9/30/2050		$	400,000
		$	5,678,700

(a)

The Notes are unsecured and unsubordinated obligations of the Issuer and are fully and unconditionally guaranteed, jointly and severally, by The Blackstone Group Inc. and each of the Blackstone Holdings Partnerships. The Notes contain customary covenants and financial restrictions that, among other things, limit the Issuer and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The Notes also contain customary events of default. All or a portion of the Notes may be redeemed at our option, in whole or in part, at any time and from time to time, prior to their stated maturity, at the make-whole redemption price set forth in the Notes. If a change of control repurchase event occurs, the Notes are subject to repurchase at the repurchase price as set forth in the Notes.

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						Securities
		Repurchase				Sold, Not Yet
		Agreements				Purchased
		(Dollars in Millions)
Balance, June 30, 2021		$	57.2			$	35.8
Balance, December 31, 2020		$	76.8			$	51.0
Six Months Ended June 30, 2021
Average Daily Balance		$	61.0			$	42.3
Maximum Daily Balance		$	75.5			$	51.0

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		July 1, 2021 to
Contractual Obligations		December 31, 2021				2022-2023				2024-2025				Thereafter				Total
		(Dollars in Thousands)
Operating Lease Obligations (a)		$	59,483			$	246,399			$	209,251			$	293,223			$	808,356
Purchase Obligations			46,080				55,482				7,106				—				108,668
Blackstone Issued Notes and Revolving Credit Facility (b)			—				400,000				355,740				4,922,960				5,678,700
Interest on Blackstone Issued Notes and Revolving Credit Facility (c)			78,290				325,004				296,504				2,088,579				2,788,377
Blackstone Funds Debt Obligations Payable			99				—				—				—				99
Blackstone Funds Capital Commitments to Investee Funds (d)			292,970				—				—				—				292,970
Due to Certain Non-Controlling Interest Holders in Connection with Tax Receivable Agreements (e)			—				107,144				105,779				738,566				951,489
Unrecognized Tax Benefits, Including Interest and Penalties (f)			1,098				—				—				—				1,098
Blackstone Operating Entities Capital Commitments to Blackstone Funds and Other (g)			3,660,673				—				—				—				3,660,673
Consolidated Contractual Obligations			4,138,693				1,134,029				974,380				8,043,328				14,290,430
Blackstone Funds Debt Obligations Payable			(99	)			—				—				—				(99	)
Blackstone Funds Capital Commitments to Investee Funds (d)			(292,970	)			—				—				—				(292,970	)
Blackstone Operating Entities Contractual Obligations		$	3,845,624			$	1,134,029			$	974,380			$	8,043,328			$	13,997,361

(a)

We lease our primary office space and certain office equipment under agreements that expire through 2031. Occupancy lease agreements, in addition to contractual rent payments, generally include additional payments for certain costs incurred by the landlord, such as building expenses, and utilities. To the extent these are fixed or determinable they are included in the table above. The table above includes operating leases that are recognized as Operating Lease Liabilities, short-term leases that are not recorded as Operating Lease Liabilities and leases that have been signed but not yet commenced which are not recorded as Operating Lease Liabilities. The amounts in this table are presented net of contractual sublease commitments.

(b)	Represents the principal amount due on the senior notes we issued. As of June 30, 2021, we had no outstanding borrowings under our revolver.

(c)

Represents interest to be paid over the maturity of our senior notes and borrowings under our revolving credit facility which has been calculated assuming no pre-payments are made and debt is held until its final maturity date. These amounts exclude commitment fees for unutilized borrowings under our revolver.

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(d)	These obligations represent commitments of the consolidated Blackstone Funds to make capital contributions to investee funds and portfolio companies. These amounts are generally due on demand and are therefore presented in the less than one year category.

(e)

Represents obligations by Blackstone’s corporate subsidiary to make payments under the Tax Receivable Agreements to certain non-controlling interest holders for the tax savings realized from the taxable purchases of their interests in connection with the reorganization at the time of Blackstone’s IPO in 2007 and subsequent purchases. The obligation represents the amount of the payments currently expected to be made, which are dependent on the tax savings actually realized as determined annually without discounting for the timing of the payments. As required by GAAP, the amount of the obligation included in the Condensed Consolidated Financial Statements and shown in Note 16. “Related Party Transactions” (see “Part I. Item 1. Financial Statements”) differs to reflect the net present value of the payments due to certain non-controlling interest holders.

(f)

The total represents gross unrecognized tax benefits of $0.5 million and interest and penalties of $0.6 million. In addition, Blackstone is not able to make a reasonably reliable estimate of the timing of payments in individual years in connection with gross unrecognized benefits of $36.9 million and interest of $3.9 million, therefore, such amounts are not included in the above contractual obligations table.

(g)

These obligations represent commitments by us to provide general partner capital funding to the Blackstone Funds, limited partner capital funding to other funds and Blackstone principal investment commitments. These amounts are generally due on demand and are therefore presented in the less than one year category; however, a substantial amount of the capital commitments are expected to be called over the next three years. We expect to continue to make these general partner capital commitments as we raise additional amounts for our investment funds over time.

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Determining whether our management fees, Incentive Fees or Performance Allocations represent variable interests – We make judgments as to whether the fees we earn are commensurate with the level of effort required for those fees and at market rates. In making this judgment, we consider, among other things, the extent of third party investment in the entity and the terms of any other interests we hold in the VIE.

•

Determining whether kick-out rights are substantive – We make judgments as to whether the third party investors in a partnership entity have the ability to remove the general partner, the investment manager or its equivalent, or to dissolve (liquidate) the partnership entity, through a simple majority vote. This includes an evaluation of whether barriers to exercise these rights exist.

•

Concluding whether Blackstone has an obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE – As there is no explicit threshold in GAAP to define “potentially significant,” management must apply judgment and evaluate both quantitative and qualitative factors to conclude whether this threshold is met.

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•

0.25% to 1.75% of committed capital or invested capital during the investment period,

•

0.25% to 1.50% of invested capital, committed capital or investment fair value subsequent to the investment period for private equity and real estate funds, and

•

1.00% to 1.50% of invested capital or net asset value subsequent to the investment period for certain of our hedge fund solutions and credit-focused funds.

•

0.24% to 1.50% of net asset value.

•

0.20% to 1.50% of net asset value or total assets.

•

0.65% to 2.00% of invested capital, net operating income or net asset value.

•

0.25% to 1.50% of net asset value.

•

0.40% to 0.50% of the aggregate par amount of collateral assets, including principal cash.

•

0.25% to 1.25% of total assets or net asset value.

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•

Note 9. “Variable Interest Entities,” and

•

Note 17. “Commitments and Contingencies — Commitments — Investment Commitments” and “— Contingencies — Guarantees.”

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Period		Total Number of Shares Purchased				Average Price Paid per Share				Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)				Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (Dollars in Thousands) (a)
Apr. 1 - Apr. 30, 2021			267,855			$	88.93				267,855			$	283,355
May 1 - May 31, 2021			1,785,711			$	89.11				1,785,711			$	864,543
Jun. 1 - Jun. 30, 2021			1,121,032			$	94.65				1,121,032			$	758,433
			3,174,598								3,174,598

(a)

On May 6, 2021, Blackstone’s board of directors authorized the repurchase of up to $1.0 billion of common stock and Blackstone Holdings Partnership Units. Under the repurchase program, repurchases may be made from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual numbers repurchased will depend on a variety of factors, including legal requirements, price and economic and market conditions. The repurchase program may be changed, suspended or discontinued at any time and does not have a specified expiration date. See “Part I. Item 1. Financial Statements – Notes to Condensed Consolidated Financial Statements – Note 14. Earnings Per Share and Stockholders’ Equity — Share Repurchase Program” and “Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Share Repurchase Program” for further information regarding this repurchase program.

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Exhibit Number		Exhibit Description
3.1*		Amended and Restated Certificate of Incorporation of Blackstone Inc.
3.2*		Amended and Restated Bylaws of Blackstone Inc.
4.1		Seventeenth Supplemental Indenture dated as of August 5, 2021 among Blackstone Holdings Finance Co. L.L.C., The Blackstone Group Inc., Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P., Blackstone Holdings IV L.P. and The Bank of New York Mellon, as trustee (incorporated herein by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 5, 2021).

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4.2		Form of 1.625% Senior Note due 2028 (included in Exhibit 4.1 hereto).
4.3		Eighteenth Supplemental Indenture dated as of August 5, 2021 among Blackstone Holdings Finance Co. L.L.C., The Blackstone Group Inc., Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P., Blackstone Holdings IV L.P. and The Bank of New York Mellon, as trustee (incorporated herein by reference to Exhibit 4.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 5, 2021).
4.4		Form of 2.000% Senior Note due 2032 (included in Exhibit 4.3 hereto).
4.5		Nineteenth Supplemental Indenture dated as of August 5, 2021 among Blackstone Holdings Finance Co. L.L.C., The Blackstone Group Inc., Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P., Blackstone Holdings IV L.P. and The Bank of New York Mellon, as trustee (incorporated herein by reference to Exhibit 4.6 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 5, 2021).
4.6		Form of 2.850% Senior Note due 2051 (included in Exhibit 4.5 hereto).
31.1*		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a).
31.2*		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a).
32.1*		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2*		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
101.INS*		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104.		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

*	Filed herewith.

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