Private equity titan says housing, logistics and data centres are its three growth areas

US equity and property investor Blackstone wants to play a greater role in helping alleviate Australia’s housing crisis.

Blackstone’s build-to-rent complex “Realm Caulfield”.

Private equity and property heavyweight Blackstone would like to play a larger role in helping solve Australia’s housing crisis.

That is according to Blackstone Real Estate global co-head Kathleen McCarthy, who identified housing, logistics and data centres as the three main growth engines for the company’s $600bn property operation.

While Australia lags behind other markets in the maturity of its build-to-rent sector, more stock is being completed, including properties run by Blackstone.

“We’re really a pioneer, I think, in the build-to-rent space; we would love to be doing more,” Ms McCarthy said.

But she says there are some barriers to ensuring that the global business is able to fully participate and bring its global smarts to the table. She cited the common challenge of the costs of developing housing as inputs have jumped but offshore groups also face hefty tax burdens.

“In this market, particularly for capital like ours, there are some additional, basically, taxes that apply to foreign owners that just make the math … that much more challenging,” she said.

Ms McCarthy said Australia was still a market where many opportunities remained available to it and she believed the company could enhance the quality of local housing stock.

Blackstone is involved in assets ranging from up-market rentals to affordable homes, where it is a leader in both the US and Britain.

“Rental housing is a quarter of our portfolio, and that spans a whole variety of formats,” Ms McCarthy said.

Global Co-Head of Blackstone Real Estate, Kathleen McCarthy. Jane Dempster/The Australian.

Locally, Blackstone has won the most prominence for its dramatic $24bn acquisition of AirTrunk, which gave it a platform across the region. Ms McCarthy said the focus in data centre investing was on providing infrastructure and operating capacity. “You’re not trying to pick which company is the winner,” she said.

Ms McCarthy cited demand coming even ahead of the AI boom, spurred by the shift to cloud computing.

“That is really the near-term catalyst for so much of the leasing activity we see in our portfolio, including, and maybe especially, in Asia Pacific,” she said.

Blackstone’s local real estate head, Chris Tynan, added that there was plenty of opportunity for dramatic growth in the business which spans a series of Asian megacities.

Mr Tynan cited the need for data to be stored in-country, creating a need for domestic data centre capacity, with AI and training to come atop of that demand driver.

Blackstone is setting up a network that will be able to provide a global solution for large hyper-scale customers and expects to invest more worldwide as developers and technology companies roll out large facilities.

“We can help them do so much more than they can do on their own in a more capital-light way,” Ms McCarthy said.

Whatever Blackstone does is likely to capitalise on its huge scale – as it did when making its takeover play for Crown Resorts.

“As a firm, we have about $180bn of dry powder in the real estate group,” Ms McCarthy said.

And it intends to buy early in the property recovery.