Blackstone chief: ‘Stay connected and consistent to counteract risk of size’

Big does not always mean better, but the two correlate closely, Blackstone’s global head of real estate Jon Gray told the annual INREV conference in Barcelona last week.

‘Can a company become too big? We have been getting that question consistently for a decade. The way to counteract the risk of size is to ensure the business stays as connected and consistent as possible. Move partners around the globe so you have the same culture. Stay integrated and create a meritocracy.’

Earlier this month, Blackstone closed a deal with US electrical goods giant GE to take over its $23 bn real estate portfolio. The transaction was signed in just 3½ weeks, Gray revealed during an interview at the conference. ‘It is an advantage that we are larger than most of our competitors and we take advantage of that. We have done that in Spain too. The key is being able to move quickly, staying connected and staying integrated.’

Thanks to its financial clout, Blackstone will get a disproportionate share of new investment, Gray predicted. Discipline when investing, an entrepreneurial and rigorous approach and operating with integrity are also vital, he added. ‘Making sure that everybody understands the culture is important. We play hard, but we play by the rules. That is hugely important to a business here.’

One of the great advantages of going public, Gray said, is that it helps attract new recruits. ‘The attractiveness of our firm is very strong and our reputation brings us success. The real asset of a firm like ours is the people we bring in the door. We have the brand to attract great people and investors. We need to make sure that we continue to open up the lanes for the best people. You can’t have a great culture or a great firm if you don’t have the room.’