University of California to invest $4 bln in Blackstone real estate fund

 University of California’s fund manager said on Tuesday it will invest $4 billion in Blackstone Inc’s real estate fund, barely a month after the asset manager limited withdrawals from the fund due to a surge in redemptions.

REITs, one of the core strategies that helped Blackstone become the world’s biggest alternative asset manager, suffered a setback in December as investors concerned about China’s economic prospects and turmoil in the Asian markets withdrew money at a frenetic pace from the real estate fund.

The investment in Blackstone Real Estate Income Trust is through UC Investments, which manages a portfolio of nearly $152 billion, according to its website.

UC Investments can redeem its holdings over two years after January 2028 and will get an 11.25% minimum annualized net return on its investment, partially supported by a $1 billion commitment from Blackstone.

Blackstone’s shares were up nearly 3% at $76.22.