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Blackstone Real Estate Income Trust

Filed: 14 Nov 21, 7:00pm


Filed Pursuant to Rule 424(b)(3)
Registration No. 333-249070
BLACKSTONE REAL ESTATE INCOME TRUST, INC.
SUPPLEMENT NO. 4 DATED NOVEMBER 12, 2021
TO THE PROSPECTUS DATED FEBRUARY 12, 2021

This prospectus supplement (“Supplement”) is part of and should be read in conjunction with the prospectus of Blackstone Real Estate Income Trust, Inc., dated February 12, 2021 (as supplemented to date, the “Prospectus”). Unless otherwise defined herein, capitalized terms used in this Supplement shall have the same meanings as in the Prospectus. References herein to the "Company," "BREIT," "we," "us," or "our" refer to Blackstone Real Estate Income Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.

The purposes of this Supplement are as follows:

to provide an update to BREIT’s portfolio;
to disclose the transaction price for each class of our common stock as of December 1, 2021;
to disclose the calculation of our October 31, 2021 NAV per share for all share classes;
to provide an update on the status of our current public offering (the “Offering”); and
to include our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021.
Portfolio Update

For the month ended October 31, 2021, BREIT’s Class I NAV per share increased $0.40, from $13.50 as of September 30, 2021 to $13.90 as of October 31, 2021.1 This price movement reflects broad-based increases in the value of assets, particularly among our residential, industrial and net lease properties.
We have oriented BREIT’s portfolio to markets and sectors where we see opportunities for outsized growth. Today, our portfolio is nearly 80% concentrated in industrial and residential, two of the best performing sectors where growth is outpacing inflation.2 These sectors typically have shorter duration leases which provide the opportunity to regularly adjust rents to market, resulting in higher cash flows. In addition, increases in the cost to develop make new supply more costly and less financially feasible, which is generally supportive of higher occupancies and stronger pricing power for existing assets. These dynamics are driving increased cash flows across the real estate sectors where BREIT is concentrated:

a.Residential (47% of BREIT’s real estate portfolio): BREIT’s top residential markets are experiencing double digit multifamily rent growth.3
b.Industrial (32% of BREIT’s real estate portfolio): BREIT’s industrial assets are executing leases at 13% higher rents in Q3’21 driven by continued e-commerce growth and disrupted supply chains.4

As a result of BREIT’s thoughtful sector and market selection, we believe BREIT is well-positioned for a rising-rate, inflationary environment.

In addition, we continue to identify differentiated opportunities to acquire high-quality, income-generating assets in growth markets. For example, on October 20, 2021, BREIT completed the acquisition of WPT Industrial Real Estate Investment Trust ((TSX: WIR.U; WIR.UN) (OTCQX: WPTIF) (“WPT”), a Canadian-listed REIT, in an all-cash transaction valued at $3.2 billion including the assumption of debt. As part of this transaction, we acquired nearly 30 million square feet of high-quality industrial assets across the U.S in established industrial submarkets concentrated in Atlanta, Dallas, Indianapolis, L.A, Memphis and Minneapolis. We believe the industrial sector is benefitting from continued strong demand driven by e-commerce growth and disrupted supply chains. This transaction further orients BREIT’s real estate portfolio toward the industrial sector.

In addition, we currently estimate that 90% - 100% of distributions for the year ended December 31, 2021 will be characterized as return of capital for federal income tax purposes.

For more information on our Net Asset Value Calculation and Valuation Guidelines, please refer to page 183 of the Prospectus.

1 BREIT’s Class S NAV per share increased from $13.51 to $13.91, BREIT’s Class T NAV per share increased from $13.32 to $13.71 and BREIT’s Class D NAV per share increased from $13.26 to $13.65.
2 Morningstar, FTSE Nareit Equity REITs as of October 31, 2021. Based on performance of industrial and residential public REITs YTD and since BREIT's inception.
3 RealPage, as of September 30, 2021. Represents effective rent growth change between Q3’20 and Q3’21 for BREIT’s top ten residential markets.
4 Leasing spreads reflect Q3’21 leasing spreads as of September 30, 2021 and compare new or renewal rent to prior rent or expiring rent, as applicable.




December 1, 2021 Transaction Price
The transaction price for each share class of our common stock for subscriptions accepted as of December 1, 2021 (and repurchases as of November 30, 2021) is as follows:
Transaction Price
(per share)
Class S$13.9072 
Class I$13.9017 
Class T$13.7102 
Class D$13.6467 
The December 1 transaction price for each of our share classes is equal to such class’s NAV per share as of October 31, 2021. A detailed calculation of the NAV per share is set forth below. The purchase price of our common stock for each share class equals the transaction price of such class, plus applicable upfront selling commissions and dealer manager fees. The repurchase price for each share class equals the transaction price of such class.

October 31, 2021 NAV per Share
We calculate NAV per share in accordance with the valuation guidelines that have been approved by our board of directors. Our NAV per share, which is updated as of the last calendar day of each month, is posted on our website at www.breit.com and is made available on our toll-free, automated telephone line at (844) 702-1299. Please refer to “Net Asset Value Calculation and Valuation Guidelines” in the Prospectus for how our NAV is determined. The Adviser is ultimately responsible for determining our NAV. All our property investments are appraised annually by third party appraisal firms in accordance with our valuation guidelines and such appraisals are reviewed by our independent valuation advisor. Transactions or events have occurred since October 31, 2021 that could have a material impact on our NAV per share, upon which our transaction price is based. We have included a breakdown of the components of total NAV and NAV per share for October 31, 2021 along with the immediately preceding month.

Our total NAV presented in the following tables includes the NAV of our Class S, Class I, Class T, and Class D common stockholders, as well as partnership interests of BREIT Operating Partnership held by parties other than the Company. The following table provides a breakdown of the major components of our total NAV as of October 31, 2021 ($ and shares in thousands):
Components of NAVOctober 31, 2021
Investments in real estate$61,083,494 
Investments in real estate debt7,730,640 
Investments in unconsolidated entities4,966,502 
Cash and cash equivalents830,192 
Restricted cash1,930,573 
Other assets4,583,918 
Mortgage notes, term loans, and revolving credit facilities, net(26,809,379)
Secured financings on investments in real estate debt(3,156,259)
Subscriptions received in advance(1,597,057)
Other liabilities(1,888,071)
Accrued performance participation allocation(1,108,104)
Management fee payable(48,585)
Accrued stockholder servicing fees(1)
(12,726)
Non-controlling interests in joint ventures(1,200,998)
Net asset value$45,304,140 
Number of outstanding shares/units3,263,972 
_____________
(1)Stockholder servicing fees only apply to Class S, Class T and Class D shares. For purposes of NAV we recognize the stockholder servicing fee as a reduction of NAV on a monthly basis as such fee is paid. Under accounting principles generally accepted in the United States of America (“GAAP”), we accrue the full cost of the stockholder servicing fee as an offering cost at the time we sell Class S, Class T and Class D shares. As of October 31, 2021, the Company has accrued under GAAP $1.1 billion of stockholder servicing fees payable to the Dealer Manager related to the Class S, Class T and Class D shares sold. The Dealer Manager does not retain any of these fees, all of which are retained by, or re-allowed (paid) to, participating broker-dealers.



The following table provides a breakdown of our total NAV and NAV per share/unit by class as of October 31, 2021 ($ and shares/units in thousands, except per share/unit data):
Third-party
Operating
Class SClass IClass TClass DPartnership
NAV Per Share/UnitSharesSharesSharesShares
Units(1)
Total
Net asset value$15,759,960 $24,570,265 $756,212 $3,540,991 $676,712 $45,304,140 
Number of outstanding shares/units1,133,2261,767,43555,157259,47648,6783,263,972 
NAV Per Share/Unit as of October 31, 2021$13.9072 $13.9017 $13.7102 $13.6467 $13.9017 
_____________
(1)Includes the partnership interests of BREIT Operating Partnership held by BREIT Special Limited Partner, Class B unit holders, and other BREIT Operating Partnership interests held by parties other than the Company.
Set forth below are the weighted averages of the key assumptions in the discounted cash flow methodology used in the October 31, 2021 valuations, based on property types.
Property TypeDiscount RateExit Capitalization Rate
Residential(1)
6.7%4.7%
Industrial5.9%4.8%
Net lease6.7%6.1%
Hospitality9.1%9.5%
Data Centers5.9%5.1%
Self Storage7.0%5.3%
Office6.6%5.2%
Retail7.2%5.7%
____________
(1)“Residential” includes multifamily and other types of rental housing such as manufactured housing, student housing and single family rental housing, as well as senior living.

These assumptions are determined by the Adviser, and reviewed by our independent valuation advisor. A change in these assumptions would impact the calculation of the value of our property investments. For example, assuming all other factors remain unchanged, the changes listed below would result in the following effects on our investment values:
ResidentialIndustrialNet LeaseHospitalityData CentersSelf StorageOfficeRetail
HypotheticalInvestmentInvestmentInvestmentInvestmentInvestmentInvestmentInvestmentInvestment
InputChangeValuesValuesValuesValuesValuesValuesValuesValues
Discount Rate0.25% decrease+2.3%+1.7%+1.8%+1.7%+2.0%+2.5%+1.9%+1.9%
(weighted average)0.25% increase(1.6)%(2.3)%(1.8)%(1.7)%(1.9)%(1.2)%(1.9)%(1.8)%
Exit Capitalization Rate0.25% decrease+4.1%+3.6%+2.4%+1.3%+3.4%+2.9%+3.5%+2.7%
(weighted average)0.25% increase(3.1)%(3.9)%(2.2)%(1.3)%(3.1)%(2.9)%(3.1)%(2.6)%


Our total NAV presented in the following tables includes the NAV of our Class S, Class I, Class T, and Class D common stockholders, as well as partnership interests of BREIT Operating Partnership held by parties other than the Company. The following table provides a breakdown of the major components of our total NAV as of September 30, 2021 ($ and shares in thousands):
Components of NAVSeptember 30, 2021
Investments in real estate$55,760,214 
Investments in real estate debt6,902,995 
Investments in unconsolidated entities4,510,948 
Cash and cash equivalents1,560,719 
Restricted cash2,070,369 
Other assets4,048,629 
Mortgage notes, term loans, and revolving credit facilities, net(25,096,034)
Secured financings on investments in real estate debt(2,767,399)
Subscriptions received in advance(1,720,934)
Other liabilities(1,313,306)
Accrued performance participation allocation(892,410)
Management fee payable(44,778)
Accrued stockholder servicing fees(1)
(11,421)
Non-controlling interests in joint ventures(1,128,327)
Net asset value$41,879,265 
Number of outstanding shares/units3,106,127 

__________
(1)Stockholder servicing fees only apply to Class S, Class T and Class D shares. For purposes of NAV we recognize the stockholder servicing fee as a reduction of NAV on a monthly basis as such fee is paid. Under GAAP, we accrue the full cost of the stockholder servicing fee as an offering cost at the time we sell Class S, Class T and Class D shares. As of September 30, 2021, the Company has accrued under GAAP $1.0 billion of stockholder servicing fees payable to the Dealer Manager related to the Class S, Class T and Class D shares sold. The Dealer Manager does not retain any of these fees, all of which are retained by, or reallowed (paid) to, participating broker-dealers.
The following table provides a breakdown of our total NAV and NAV per share/unit by class as of September 30, 2021 ($ and shares/units in thousands, except per share/unit data):
Third-party
Operating
Class SClass IClass TClass DPartnership
NAV Per Share/UnitSharesSharesSharesShares
Units(1)
Total
Net asset value$14,612,982 $22,768,211 $718,305 $3,230,211 $549,556 $41,879,265 
Number of outstanding shares/units1,081,4971,686,44053,946243,53840,7063,106,127 
NAV Per Share/Unit as of September 30, 2021$13.5118 $13.5008 $13.3152 $13.2637 $13.5008 
____________
(1)Includes the partnership interests of BREIT Operating Partnership held by BREIT Special Limited Partnership, Class B unit holders, and other BREIT Operating Partnership interests held by parties other than the Company.















Status of our Current Public Offering

We are currently offering on a continuous basis up to $24.0 billion in shares of common stock, consisting of up to $20.0 billion in shares in our primary offering and up to $4.0 billion in shares pursuant to our distribution reinvestment plan. As of the date of this Supplement, we had issued and sold in the Offering (i) 1,016,923,657 shares of our common stock (consisting of 433,166,318 Class S Shares, 439,908,667 Class I Shares, 10,461,751 Class T Shares, and 133,386,921 Class D Shares) in the primary offering for total proceeds of $12.7 billion and (ii) 36,783,261 shares of our common stock (consisting of 18,683,980 Class S Shares, 13,413,663 Class I Shares, 1,015,622 Class T Shares, and 3,669,996 Class D Shares) pursuant to our distribution reinvestment plan for a total value of $0.5 billion. As of October 31, 2021, our aggregate NAV was $45.3 billion. We intend to continue selling shares in the Offering on a monthly basis.
Quarterly Report on Form 10-Q for the Quarter Ended September 30, 2021

On November 12, 2021, we filed our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 with the Securities and Exchange Commission. The report (without exhibits) is attached to this Supplement.



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM                 TO                 
Commission File Number: 000-55931
blackstonelogoa.jpg 
Blackstone Real Estate Income Trust, Inc.
(Exact name of Registrant as specified in its charter)
Maryland81-0696966
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
345 Park Avenue
New York,NY10154
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (212) 583-5000
Securities registered pursuant to Section 12(b) of the Act: None
Title of each class Trading
Symbol(s)
 Name of each exchange on which registered
     
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 
Large accelerated filer Accelerated filer 
   
Non-accelerated filer Smaller reporting company 
      
Emerging growth company    
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒
As of November 12, 2021, the issuer had the following shares outstanding: 1,185,308,733 shares of Class S common stock, 1,877,094,046 shares of Class I common stock, 56,203,721 shares of Class T common stock, and 273,758,489 shares of Class D common stock.




TABLE OF CONTENTS
 





PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands, except per share data)
 
 September 30, 2021December 31, 2020
Assets  
Investments in real estate, net$43,596,089 $32,457,713 
Investments in unconsolidated entities (includes $558,399 and $0 at fair value
   as of September 30, 2021 and December 31, 2020, respectively)
4,252,882 816,220 
Investments in real estate debt6,902,995 4,566,306 
Cash and cash equivalents1,560,719 333,388 
Restricted cash2,070,369 711,135 
Other assets5,065,548 1,799,253 
Total assets$63,448,602 $40,684,015 
Liabilities and Equity
Mortgage notes, term loans, and secured revolving credit facilities, net$24,966,176 $19,976,161 
Secured financings of investments in real estate debt2,767,399 2,140,993 
Unsecured revolving credit facilities— 
Due to affiliates1,979,927 887,660 
Other liabilities3,258,061 1,465,194 
Total liabilities32,971,563 24,470,008 
Commitments and contingencies— — 
Redeemable non-controlling interests80,838 30,056 
Equity
Common stock — Class S shares, $0.01 par value per share, 3,000,000 shares authorized; 1,081,497 and 702,853 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively10,815 7,029 
Common stock — Class I shares, $0.01 par value per share, 6,000,000 shares authorized; 1,686,440 and 927,080 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively16,863 9,270 
Common stock — Class T shares, $0.01 par value per share, 500,000 shares authorized; 53,946 and 45,943 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively539 459 
Common stock — Class D shares, $0.01 par value per share, 500,000 shares authorized; 243,538 and 124,141 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively2,435 1,241 
Additional paid-in capital34,020,582 19,059,045 
Accumulated other comprehensive loss(8,643)— 
Accumulated deficit and cumulative distributions(4,804,187)(3,224,318)
Total stockholders' equity29,238,404 15,852,726 
Non-controlling interests attributable to third party joint ventures748,195 143,253 
Non-controlling interests attributable to BREIT OP unitholders409,602 187,972 
Total equity30,396,201 16,183,951 
Total liabilities and equity$63,448,602 $40,684,015 

See accompanying notes to condensed consolidated financial statements.

1


Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
Three Months Ended September 30,Nine Months Ended September 30,
2021202020212020
Revenues
Rental revenue$808,098 $562,053 $2,141,823 $1,647,865 
Hospitality revenue127,507 56,038 288,310 205,291 
Other revenue43,704 17,280 92,814 49,844 
Total revenues979,309 635,371 2,522,947 1,903,000 
Expenses
Rental property operating314,017 193,306 799,707 548,729 
Hospitality operating92,280 60,339 223,053 204,168 
General and administrative7,106 5,430 21,855 19,025 
Management fee122,866 57,619 288,144 160,544 
Performance participation allocation449,822 — 892,410 — 
Impairment of investments in real estate— 6,217 — 12,343 
Depreciation and amortization482,045 332,599 1,282,053 1,008,756 
Total expenses1,468,136 655,510 3,507,222 1,953,565 
Other income (expense)
Income from unconsolidated entities78,445 25,073 183,155 63,678 
Income (loss) from investments in real estate debt83,052 206,046 438,986 (317,212)
Net (loss) gain on dispositions of real estate(9,586)100,070 13,216 100,441 
Interest income41 122 136 2,102 
Interest expense(204,538)(174,193)(567,685)(539,276)
Loss on extinguishment of debt(3,372)(5,258)(9,545)(6,495)
Other income (expense)177,631 (9,252)411,160 (29,022)
Total other income (expense)121,673 142,608 469,423 $(725,784)
Net (loss) income$(367,154)$122,469 $(514,852)$(776,349)
Net loss attributable to non-controlling interests in third party joint ventures$5,472 $593 $5,149 $1,796 
Net loss (income) attributable to non-controlling interests in BREIT OP4,393 (1,790)6,129 $10,177 
Net (loss) income attributable to BREIT stockholders$(357,289)$121,272 $(503,574)$(764,376)
Net (loss) income per share of common stock — basic and diluted$(0.12)$0.07 $(0.21)$(0.49)
Weighted-average shares of common stock outstanding, basic and diluted2,873,453 1,651,693 2,379,158 1,545,984 
 
See accompanying notes to condensed consolidated financial statements.

2


Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(in thousands, except per share data)
Three Months Ended September 30,Nine Months Ended September 30,
2021202020212020
Net (loss) income$(367,154)$122,469 $(514,852)$(776,349)
Other comprehensive income (loss):
Foreign currency translation losses, net(8,643)— (8,643)— 
Comprehensive (loss) income(375,797)122,469 (523,495)(776,349)
Comprehensive loss attributable to non-controlling interests in third party joint ventures5,472 593 5,149 1,796 
Comprehensive loss (income) attributable to non-controlling interests in BREIT OP4,393 (1,790)6,129 10,177 
Comprehensive (loss) income attributable to BREIT stockholders$(365,932)$121,272 $(512,217)$(764,376)
3


Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Statements of Changes in Equity (Unaudited)
(in thousands, except per share data)
Par ValueAccumulated
Other Comprehensive Loss
Accumulated
Deficit and
Cumulative
Distributions
Non-
controlling
Interests
Attributable
to Third Party
Joint Ventures
Non-
controlling
Interests
Attributable
to BREIT OP
Unitholders
Common
Stock
Class S
Common
Stock
Class I
Common
Stock
Class T
Common
Stock
Class D
Additional
Paid-in
Capital
Total
Stockholders'
Equity
Total
Equity
Balance at June 30, 2021$9,218 $13,262 $502 $1,815 $26,842,197 $— $(4,008,476)$22,858,518 $153,817 $250,150 $23,262,485 
Common stock issued1,561 3,639 37 612 7,446,347 — — 7,452,196 — — 7,452,196 
Offering costs— — — — (249,159)— — (249,159)— — (249,159)
Distribution reinvestment65 83 13 211,879 — — 212,043 — — 212,043 
Common stock/units repurchased(29)(123)(3)(5)(205,990)— — (206,150)— — (206,150)
Amortization of compensation awards— — — 151 — — 153 — 1,177 1,330 
Net loss ($382 allocated to redeemable non‑controlling interests)— — — — — — (357,289)(357,289)(5,092)(4,391)(366,772)
Other comprehensive loss— — — — — (8,643)— (8,643)— — (8,643)
Distributions declared on common stock ($0.1637 gross per share)— — — — — — (438,422)(438,422)— — (438,422)
Contributions from non-controlling interests— — — — — — — — 603,165 167,946 771,111 
Distributions to and redemptions of non-controlling interests— — — — — — — — (3,695)(5,280)(8,975)
Allocation to redeemable non-controlling interests— — — — (24,843)— — (24,843)— — (24,843)
Balance at September 30, 2021$10,815 $16,863 $539 $2,435 $34,020,582 $(8,643)$(4,804,187)$29,238,404 $748,195 $409,602 $30,396,201 
Par ValueAccumulated
Other Comprehensive Loss
Accumulated
Deficit and
Cumulative
Distributions
Non-
controlling
Interests
Attributable
to Third Party
Joint Ventures
Non-
controlling
Interests
Attributable
to BREIT OP
Unitholders
Common
Stock
Class S
Common
Stock
Class I
Common
Stock
Class T
Common
Stock
Class D
Additional
Paid-in
Capital
Total
Stockholders'
Equity
Total
Equity
Balance at June 30, 2020$6,322 $8,200 $440 $1,032 $16,952,056 $— $(2,749,989)$14,218,061 $159,459 $191,993 $14,569,513 
Common stock issued312 565 15 68 1,021,753 — — 1,022,713 — — 1,022,713 
Offering costs— — — — (35,098)— — (35,098)— — (35,098)
Distribution reinvestment54 52 128,911 — — 129,029 — — 129,029 
Common stock/units repurchased(68)(225)(8)(13)(332,425)— — (332,739)— (152)(332,891)
Amortization of compensation awards— — — 99 — — 100 — (31)69 
Net income (loss) ($263 loss allocated to redeemable 
non‑controlling interests)
— — — — — — 121,272 121,272 (328)1,788 122,732 
Distributions declared on common stock ($0.1586 gross per share)— — — — — — (245,039)(245,039)— — (245,039)
Contributions from non-controlling interests— — — — — — — — 223 1,270 1,493 
Distributions to and redemptions of non-controlling interests— — — — (1,946)— — (1,946)(16,652)(3,466)(22,064)
Allocation to redeemable non-controlling interests— — — — (6,429)— — (6,429)— — (6,429)
Balance at September 30, 2020$6,620 $8,593 $450 $1,096 $17,726,921 $— $(2,873,756)$14,869,924 $142,702 $191,402 $15,204,028 


4


Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Statements of Changes in Equity (Unaudited)
(in thousands, except per share data)
 Par Value Accumulated
Other Comprehensive Loss
Accumulated
Deficit and
Cumulative
Distributions
 Non-
controlling
Interests
Attributable
to Third Party
Joint Ventures
Non-
controlling
Interests
Attributable
to BREIT OP
Unitholders
 
Common
Stock
Class S
Common
Stock
Class I
Common
Stock
Class T
Common
Stock
Class D
Additional
Paid-in
Capital
Total
Stockholders'
Equity
Total
Equity
Balance at December 31, 2020$7,029 $9,270 $459 $1,241 $19,059,045 $— $(3,224,318)$15,852,726 $143,253 $187,972 $16,183,951 
Common stock issued3,741 8,010 81 1,178 15,957,649 — — 15,970,659 — — 15,970,659 
Offering costs— — — — (540,776)— — (540,776)— — (540,776)
Distribution reinvestment183 208 10 34 535,004 — — 535,439 — — 535,439 
Common stock/units repurchased(138)(629)(11)(18)(956,242)— — (957,038)(129)(1,450)(958,617)
Amortization of compensation awards— — — 395 — — 399 — 3,046 3,445 
Net loss ($920 allocated to redeemable non‑controlling interests)— — — — — — (503,574)(503,574)(4,233)(6,125)(513,932)
Other comprehensive loss— — — — — (8,643)— (8,643)— — (8,643)
Distributions declared on common stock ($0.4852 gross per share)— — — — — — (1,076,295)(1,076,295)— — (1,076,295)
Contributions from non-controlling interests— — — — — — — — 619,991 240,412 860,403 
Distributions to and redemptions of non-controlling interests— — — — — — — — (10,687)(14,253)(24,940)
Allocation to redeemable non-controlling interests— — — — (34,493)— — (34,493)— — (34,493)
Balance at September 30, 2021$10,815 $16,863 $539 $2,435 $34,020,582 $(8,643)$(4,804,187)$29,238,404 $748,195 $409,602 $30,396,201 
 
 Par Value Accumulated
Other Comprehensive Loss
Accumulated Deficit and
Cumulative
Distributions
 Non-
controlling
Interests
Attributable
to Third Party
Joint Ventures
Non-
controlling
Interests
Attributable
to BREIT OP
Unitholders
 
Common
Stock
Class S
Common
Stock
Class I
Common
Stock
Class T
Common
Stock
Class D
Additional
Paid-in
Capital
Total
Stockholders'
Equity
Total
Equity
Balance at December 31, 2019$5,308 $4,743 $398 $847 $11,716,721 — $(1,422,885)$10,305,132 $157,795 $151,721 $10,614,648 
Common stock issued1,555 4,278 75 282 6,968,348 — — 6,974,538 — — 6,974,538 
Offering costs— — — — (161,478)— — (161,478)— — (161,478)
Distribution reinvestment153 140 24 356,869 — — 357,195 — — 357,195 
Common stock/units repurchased(396)(571)(32)(57)(1,145,159)— — (1,146,215)— (1,907)(1,148,122)
Amortization of compensation awards— — — 297 — — 300 — 969 1,269 
Net loss ($1,273 allocated to redeemable non-controlling interests)— — — — — — (764,376)(764,376)(536)(10,164)(775,076)
Distributions declared on common stock ($0.4755 gross per share)— — — — — — (686,495)(686,495)— — (686,495)
Contributions from non-controlling interests— — — — — — — — 11,394 61,163 72,557 
Distributions to and redemptions of non-controlling interests— — — — (1,946)— — (1,946)(25,951)(10,380)(38,277)
Allocation to redeemable non-controlling interests— — — — (6,731)— — (6,731)— — (6,731)
Balance at September 30, 2020$6,620 $8,593 $450 $1,096 $17,726,921 $— $(2,873,756)$14,869,924 $142,702 $191,402 $15,204,028 
 
See accompanying notes to condensed consolidated financial statements.
5


Blackstone Real Estate Income Trust, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
 Nine Months Ended September 30,
 20212020
Cash flows from operating activities:  
Net loss$(514,852)$(776,349)
Adjustments to reconcile net loss to net cash provided by operating activities:
Management fee288,144 160,544 
Performance participation allocation892,410 — 
Impairment of investments in real estate— 12,343 
Depreciation and amortization1,282,053 1,008,756 
Net gain on dispositions of real estate(13,216)(100,441)
Loss on extinguishment of debt9,545 6,495 
Unrealized (gain) loss on changes in fair value of financial instruments(668,503)484,332 
Income from unconsolidated entities(183,155)(63,678)
Distributions from unconsolidated entities84,315 57,856 
Other items(21,409)(23,996)
Change in assets and liabilities:
(Increase) / decrease in other assets(166,966)(69,800)
Increase / (decrease) in due to affiliates(1,109)(1,222)
Increase / (decrease) in other liabilities203,156 34,611 
Net cash provided by operating activities1,190,413 729,451 
Cash flows from investing activities:
Acquisitions of real estate(9,932,224)(3,246,297)
Capital improvements to real estate(348,139)(230,749)
Proceeds from disposition of real estate194,575 385,269 
Pre-acquisition costs and deposits(593,566)(58,274)
Investment in unconsolidated entities(3,336,486)(808,312)
Purchase of investments in real estate debt(3,058,345)(1,177,967)
Proceeds from sale/repayment of investments in real estate debt1,170,285 363,175 
Purchase of real estate-related equity securities(1,738,385)(703,695)
Proceeds from sale of real estate-related equity securities— 102,932 
Net cash used in investing activities(17,642,285)(5,373,918)
Cash flows from financing activities:
Proceeds from issuance of common stock15,183,976 6,014,033 
Offering costs paid(118,997)(71,135)
Subscriptions received in advance1,720,934 217,461 
Repurchase of common stock(843,042)(996,873)
Repurchase of management fee shares(172,230)(112,664)
Borrowings under mortgage notes, term loans, and secured revolving credit facilities7,614,710 6,207,729 
Repayments of mortgage notes, term loans, and secured revolving credit facilities(4,966,542)(5,849,236)
Borrowings under secured financings of investments in real estate debt916,684 1,898,018 
Repayments of secured financings of investments in real estate debt(275,980)(2,616,391)
Borrowings under affiliate unsecured revolving credit facility950,000 175,000 
Repayments of affiliate unsecured revolving credit facility(950,000)(175,000)
Borrowings under unsecured revolving credit facilities160,000 130,000 
Repayments of unsecured revolving credit facilities(160,000)(130,000)
Payment of deferred financing costs(51,696)(41,721)
Redemption of redeemable non-controlling interest(111,949)(83,625)
Redemption of affiliate service provider incentive compensation awards(1,083)(1,755)
Contributions from non-controlling interests637,158 22,503 
Distributions to and redemptions of non-controlling interests(19,876)(41,202)
Distributions(474,565)(301,788)
Net cash provided by financing activities19,037,502 4,243,354 
Net change in cash and cash equivalents and restricted cash2,585,630 (401,113)
Cash and cash equivalents and restricted cash, beginning of period1,044,523 1,109,702 
Effects of currency translation on cash, cash equivalents and restricted cash935 — 
Cash and cash equivalents and restricted cash, end of period$3,631,088 $708,589 
Reconciliation of cash and cash equivalents and restricted cash to the condensed consolidated balance sheets:
Cash and cash equivalents$1,560,719 $240,022 
Restricted cash2,070,369 468,567 
Total cash and cash equivalents and restricted cash$3,631,088 $708,589 
6


Non-cash investing and financing activities:  
Assumption of mortgage notes in conjunction with acquisitions of real estate$2,353,084 $224,123 
Assumption of other liabilities in conjunction with acquisitions of real estate$51,824 $257 
Issuance of BREIT OP units as consideration for acquisitions of real estate$165,746 $— 
Assumption of other liabilities in conjunction with acquisitions of investments in unconsolidated entities$9,435 $— 
Recognition of financing lease liability$16,855 $— 
Accrued pre-acquisition costs$8,797 $1,203 
Accrued capital expenditures and acquisition related costs$18,276 $7,168 
Accrued distributions$67,264 $27,754 
Accrued stockholder servicing fee due to affiliate$423,471 $94,245 
Redeemable non-controlling interest issued as settlement of performance participation allocation$192,648 $141,396 
Exchange of redeemable non-controlling interest for Class I shares$12,246 $9,228 
Exchange of redeemable non-controlling interest for Class I or Class B units$68,453 $48,543 
Allocation to redeemable non-controlling interest$34,493 $6,731 
Distribution reinvestment$535,439 $357,195 
Accrued common stock repurchases$75,308 $71,047 
Accrued common stock repurchases due to affiliate$— $18,937 
Payable for unsettled investments in real estate debt$236,686 $1,065 
Receivable for unsettled investments in real estate debt$5,233 $— 
See accompanying notes to condensed consolidated financial statements.

7


Blackstone Real Estate Income Trust, Inc.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Organization and Business Purpose
Blackstone Real Estate Income Trust, Inc. (“BREIT” or the “Company”) invests primarily in stabilized income-oriented commercial real estate in the United States and, to a lesser extent, in real estate debt. The Company is the sole general partner and majority limited partner of BREIT Operating Partnership, L.P., a Delaware limited partnership (“BREIT OP”). BREIT Special Limited Partner L.P. (the “Special Limited Partner”), a wholly-owned subsidiary of Blackstone Inc. (together with its affiliates, “Blackstone”), owns a special limited partner interest in BREIT OP. Substantially all of the Company’s business is conducted through BREIT OP. The Company and BREIT OP are externally managed by BX REIT Advisors L.L.C. (the “Adviser”). The Adviser is part of the real estate group of Blackstone, a leading global investment manager. The Company was formed on November 16, 2015 as a Maryland corporation and qualifies as a real estate investment trust (“REIT”) for U.S. federal income tax purposes.
The Company had previously registered with the Securities and Exchange Commission (the “SEC”) two offerings for up to an aggregate of $17.0 billion in shares of common stock (the “Previous Offerings”), and accepted gross offering proceeds of $16.3 billion during the period from January 1, 2017 to February 1, 2021. The Company subsequently registered a follow-on offering with the SEC of up to $24.0 billion in shares of common stock, consisting of up to $20.0 billion in shares in its primary offering and up to $4.0 billion in shares pursuant to its distribution reinvestment plan, which the Company began using to offer shares of its common stock in February 2021 (the “Current Offering” and with the Previous Offerings, the “Offering”). As of September 30, 2021, the Company had received aggregate net proceeds of $37.4 billion from selling shares of the Company’s common stock through both the Offering and in unregistered sales. The Company intends to sell any combination of four classes of shares of its common stock, with a dollar value up to the maximum aggregate amount of the Current Offering. The share classes have different upfront selling commissions, dealer manager fees and ongoing stockholder servicing fees. The Company intends to continue selling shares on a monthly basis.
As of September 30, 2021, the Company owned 1,599 properties and 20,940 single family rental homes. The Company currently operates in nine reportable segments: Residential, Industrial, Net Lease, Data Centers, Hospitality, Self Storage, Retail, and Office properties, and Investments in Real Estate Debt. Residential includes multifamily and other types of rental housing such as manufactured housing, student housing and single family rental housing, as well as senior living. Net Lease includes the real estate assets of The Bellagio Las Vegas (the “Bellagio”) and the unconsolidated interest in the MGM Grand and Mandalay Bay joint venture. Any additional unconsolidated interests are included in the respective property segment as further described in Note 4 – Investments in Unconsolidated Entities. Financial results by segment are reported in Note 15 — Segment Reporting.
2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements 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 and Rule 10-01 of Regulation S-X. The condensed consolidated financial statements, including the condensed notes thereto, 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 the Company's condensed consolidated financial statements are reasonable and prudent. The accompanying unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the SEC.
The accompanying condensed consolidated financial statements include the accounts of the Company, the Company’s subsidiaries, and joint ventures in which the Company has a controlling interest. All intercompany balances and transactions have been eliminated in consolidation.
Principles of Consolidation
The Company consolidates all entities in which it has a controlling financial interest through majority ownership or voting rights and variable interest entities whereby the Company is the primary beneficiary. In determining whether the Company has a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, the Company considers whether the entity is a variable interest entity (“VIE”) and whether it is the primary beneficiary. The Company is the primary beneficiary of a VIE when it has (i) the power to direct the most significant activities impacting the economic performance of the VIE and (ii) the obligation to absorb losses or receive benefits significant to the VIE. Entities that do not qualify as VIEs are generally
8


considered voting interest entities (“VOEs”) and are evaluated for consolidation under the voting interest model. VOEs are consolidated when the Company controls the entity through a majority voting interest or other means. When the requirements for consolidation are not met and the Company has significant influence over the operations of the entity, the investment is accounted for under the equity method of accounting. Equity method investments for which the Company has not elected a fair value option are initially recorded at cost and subsequently adjusted for the Company’s pro-rata share of net income, contributions and distributions. When the Company elects the fair value option (“FVO”), the Company records its share of net asset value of the Entity and any related unrealized gains and losses.
BREIT OP and each of the Company’s joint ventures are considered to be either a VIE or VOE. The Company consolidates these entities, excluding certain equity method investments, because it has the ability to direct the most significant activities of the entities such as purchases, dispositions, financings, budgets, and overall operating plans.
For consolidated joint ventures, the non-controlling partner’s share of the assets, liabilities, and operations of each joint venture is included in non-controlling interests as equity of the Company. The non-controlling partner’s interest is generally computed as the joint venture partner’s ownership percentage. Certain of the joint ventures formed by the Company provide the other partner a profits interest based on certain internal rate of return hurdles being achieved. Any profits interest due to the other partner is reported within non-controlling interests.
As of September 30, 2021, the total assets and liabilities of the Company’s consolidated VIEs, excluding BREIT OP, were $14.9 billion and $8.5 billion, respectively, compared to $11.5 billion and $8.0 billion as of December 31, 2020. Such amounts are included on the Company’s Condensed Consolidated Balance Sheets.
Certain of the Company’s joint ventures are accounted for under the equity method of accounting as the requirements for consolidation are not met. As of September 30, 2021, the Company did not consolidate six of its joint ventures and accounted for these under the equity method of accounting. The Company has elected the FVO for two of its equity method investments while the remaining four are presented at historical cost. Refer to Note 4 for additional details on the Company’s investments in unconsolidated entities.
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. As of September 30, 2021, the novel coronavirus (“COVID-19”) pandemic is ongoing. During 2020, the COVID-19 pandemic created disruption in global supply chains, increased rates of unemployment and adversely impacted many industries. In 2021, the global economy has, with certain setbacks, begun reopening and wider distribution of vaccines and easing of travel restrictions appear to be encouraging greater economic activity. Nonetheless, the recovery could remain uneven, particularly given uncertainty with respect to the distribution and acceptance of the vaccines and their effectiveness with respect to new variants of the virus, and the resolution of supply chain issues and other longer lasting impacts of the pandemic. As a result, the Company is still unable to predict when normal economic activity and business operations will fully resume. The Company believes the estimates and assumptions underlying its condensed consolidated financial statements are reasonable and supportable based on the information available as of September 30, 2021. However, uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of September 30, 2021 inherently less certain than they would be absent the current and potential impacts of COVID-19. Actual results may ultimately differ from those estimates.
Foreign Currency
In the normal course of business, the Company makes investments in real estate outside the United States ("U.S.") through subsidiaries that have a non-U.S. dollar functional currency. Non-U.S. dollar denominated assets and liabilities of these foreign subsidiaries are translated to U.S. dollars at the prevailing exchange rate at the reporting date and income, expenses, gains, and losses are translated at the average exchange rate over the applicable period. Cumulative translation adjustments arising from the translation of non-U.S. dollar denominated assets and liabilities are recorded in Other Comprehensive Income (Loss).
Fair Value Measurements
Under normal market conditions, the fair value of an investment is the amount that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date (i.e., the exit price). The Company uses a hierarchical framework that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment and the characteristics specific to the investment, and the state of the marketplace, including the existence and transparency of transactions between market participants.
9


Investments with readily available actively quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.
Investments measured and reported at fair value are classified and disclosed in one of the following levels within the fair value hierarchy:
Level 1 — quoted prices are available in active markets for identical investments as of the measurement date. The Company does not adjust the quoted price for these investments.
Level 2 — quoted prices are available in markets that are not active or model inputs are based on inputs that are either directly or indirectly observable as of the measurement date.
Level 3 — pricing inputs are unobservable and include instances where there is minimal, if any, market activity for the investment. These inputs require significant judgment or estimation by management or third parties when determining fair value and generally represent anything that does not meet the criteria of Levels 1 and 2. Due to the inherent uncertainty of these estimates, these values may differ materially from the values that would have been used had a ready market for these investments existed.
Valuation of assets and liabilities measured at fair value
The Company’s investments in real estate debt are reported at fair value. As of September 30, 2021 and December 31, 2020, the Company’s investments in real estate debt, directly or indirectly, consisted of commercial mortgage-backed securities (“CMBS”) and residential mortgage-backed securities (“RMBS”), which are securities backed by one or more mortgage loans secured by real estate assets, as well as corporate bonds, term loans, mezzanine loans, and other investments in debt issued by real estate-related companies or secured by real estate assets. The Company generally determines the fair value of its investments in real estate debt by utilizing third-party pricing service providers whenever available.  
In determining the fair value of a particular investment, pricing service providers may use broker-dealer quotations, reported trades or valuation estimates from their internal pricing models to determine the reported price. The pricing service providers’ internal models for securities such as real estate debt generally consider the attributes applicable to a particular class of the security (e.g., credit rating, seniority), current market data, and estimated cash flows for each security, and incorporate specific collateral performance, as applicable.
Certain of the Company’s investments in real estate debt, such as mezzanine loans and other investments, are unlikely to have readily available market quotations. In such cases, the Company will generally determine the initial value based on the acquisition price of such investment if acquired by the Company or the par value of such investment if originated by the Company. Following the initial measurement, the Company will determine fair value by utilizing or reviewing certain of the following (i) market yield data, (ii) discounted cash flow modeling, (iii) collateral asset performance, (iv) local or macro real estate performance, (v) capital market conditions, (vi) debt yield or loan-to-value ratios, and (vii) borrower financial condition and performance. During September 2021, the Company made an investment in an unconsolidated joint venture that holds investments in real estate debt, which is reflected at its initial investment as of September 30, 2021 (Level 2 inputs). The Company believes the transaction price provides the most observable indication of fair value as of September 30, 2021 given the timing of the investment and lack of significant changes in market conditions. Refer to Note 5 for additional details on the Company’s investments in real estate debt.
The Company’s investments in equity securities of public and private real estate-related companies are reported at fair value. In determining the fair value of public equity securities, the Company utilizes the closing price of such securities in the principal market in which the security trades (Level 1 inputs). The Company’s investment in a preferred equity security is reflected at its fair value as of September 30, 2021 (Level 2 inputs). In determining the fair value, the Company utilizes inputs such as stock volatility, discount rate, and risk-free interest rate. The Company's investment in a private real estate company is reflected at its fair value as of September 30, 2021 (Level 3 inputs). To determine the fair value, the Company utilizes inputs such as the multiples of comparable companies and select financial statement metrics. As of September 30, 2021 and December 31, 2020, the Company’s $2.7 billion and $0.6 billion of equity securities, respectively, were recorded as a component of Other Assets on the Company’s Condensed Consolidated Balance Sheets.
The resulting unrealized gains and losses from public and private real estate-related companies are recorded as a component of Other Income (Expense) on the Company’s Condensed Consolidated Statements of Operations. During the three and nine months ended September 30, 2021, the Company recognized $154.8 million and $379.6 million of unrealized gains, respectively, on its investments in equity securities. During the three and nine months ended September 30, 2020, the Company recognized $15.4 million of unrealized losses and $40.6 million of unrealized losses, respectively, on its investments in equity securities.
10


The Company has elected the FVO for two of its equity method investments and therefore, reports these investments at fair value. As such, the resulting unrealized gains and losses are recorded as a component of Income From Unconsolidated Entities on the Company’s Condensed Consolidated Statements of Operations. The Company separately values the assets and liabilities of the equity method investments. To determine the fair value of the assets of the equity method investments, the Company utilizes a discounted cash flow methodology, taking into consideration various factors including discount rate and exit capitalization rate. The Company determines the fair value of the indebtedness of the equity method investment by modeling the cash flows required by the debt agreements and discounting them back to the present value using an estimated market yield. Additionally, the Company considers current market rates and conditions by evaluating similar borrowing agreements with comparable loan-to-value ratios and credit profiles. After the fair value of the assets and liabilities are determined, the Company applies its ownership interest to the net asset value and reflects this amount as its equity method investment at fair value. The inputs used in determining the Company’s equity method investments carried at fair value are considered Level 3.
The Company’s derivative financial instruments are reported at fair value. As of September 30, 2021 and December 31, 2020, the Company’s derivative financial instruments consisted of foreign currency and interest rate contracts. The fair values of the Company’s foreign currency and interest rate contracts were estimated using advice from a third-party derivative specialist, based on contractual cash flows and observable inputs comprising yield curves, foreign currency rates and credit spreads (Level 2 inputs).
The following table details the Company’s assets and liabilities measured at fair value on a recurring basis ($ in thousands):
September 30, 2021December 31, 2020
Level ILevel 2Level 3TotalLevel ILevel 2Level 3Total
Assets:
Investments in real estate debt$— $5,890,697 $1,012,298 $6,902,995 $— $4,445,414 $120,892 $4,566,306 
Equity securities2,088,122 387,600 224,408 2,700,130 327,935 271,250 — 599,185 
Investments in unconsolidated entities— — 558,399 558,399 — — — — 
Derivatives— 53,478 — 53,478 — — — — 
Total$2,088,122 $6,331,775 $1,795,105 $10,215,002 $327,935 $4,716,664 $120,892 $5,165,491 
Liabilities:
Derivatives$— $22,860 $— $22,860 $— $55,536 $— $55,536 
Total$— $22,860 $— $22,860 $— $55,536 $— $55,536 
The following table details the Company’s assets measured at fair value on a recurring basis using Level 3 inputs ($ in thousands):
Investments in
Real Estate Debt
Investments in
Unconsolidated Entities
Equity SecuritiesTotal
Balance as of December 31, 2020$120,892 $— $— $120,892 
Purchases894,696 439,347 205,980 1,540,023 
Distributions received— (14,130)— (14,130)
Included in net income
Unrealized gain included in income from unconsolidated entities— 133,182 — 133,182 
Discount accretion included in income (loss) from investments in real estate debt1,588 — — 1,588 
Unrealized loss included in income (loss) from investments in real estate debt(4,878)— — (4,878)
Unrealized gain included in other income (expense)— — 18,428 18,428 
Balance as of September 30, 2021$1,012,298 $558,399 $224,408 $1,795,105 
11


The following tables contain the quantitative inputs and assumptions used for items categorized in Level 3 of the fair value hierarchy ($ in thousands):
September 30, 2021
 Fair ValueValuation TechniqueUnobservable InputsWeighted AverageImpact to Valuation from an Increase in Input
Investments in real estate debt$1,012,298 Discounted cash flowYield8.0%Decrease
Investments in unconsolidated entities$558,399 Discounted cash flowDiscount Rate5.9%Decrease
 Exit Capitalization Rate4.8%Decrease
 Weighted Average Cost of Capital10.6%Decrease
Equity securities$224,408 Market comparableEnterprise Value/
Forward EBITDA Multiple
21.1xIncrease
 December 31, 2020
 Fair ValueValuation TechniqueUnobservable InputRateImpact to Valuation from an Increase in Input
Investments in real estate debt$120,892 Discounted cash flowYield10.3%Decrease


Valuation of liabilities not measured at fair value
As of September 30, 2021, the fair value of the Company’s mortgage notes, term loans, and secured revolving credit facilities, secured financings on investments in real estate debt, and unsecured revolving credit facilities was $130.2 million above carrying value. As of December 31, 2020, the fair value of the Company’s mortgage notes, term loans, and secured revolving credit facilities, secured financings on investments in real estate debt, and unsecured revolving credit facilities was $48.6 million above carrying value. Fair value of the Company’s indebtedness is estimated by modeling the cash flows required by the Company’s debt agreements and discounting them back to the present value using an estimated market yield. Additionally, the Company considers current market rates and conditions by evaluating similar borrowing agreements with comparable loan-to-value ratios and credit profiles. The inputs used in determining the fair value of the Company’s indebtedness are considered Level 3.
Derivative Financial Instruments
As of September 30, 2021 and December 31, 2020, all of the Company’s derivative instruments were non-designated hedges. The Company presents changes in the fair value of its non-designated hedges as a component of Income (loss) from Investments in Real Estate Debt or Other Income (Expense) on the Company’s Condensed Consolidated Statements of Operations depending on the nature of the derivative instrument.
 
The Company has elected to not offset derivative assets and liabilities or financial assets in its Condensed Consolidated Balance Sheets, including cash, that may be received or paid as part of collateral arrangements, even when an enforceable master netting agreement is in place that provide the Company, in the event of counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations. Derivative financial instruments are recorded as a component of either Other Assets or Other Liabilities on the Company’s Condensed Consolidated Balance Sheets at fair value.
Stock-Based Compensation
The Company’s stock-based compensation consists of incentive compensation awards issued to certain employees of affiliate portfolio company service providers and certain employees of Simply Self Storage, a wholly owned subsidiary of BREIT. Such awards vest over the life of the awards and stock-based compensation expense is recognized for these awards on a straight-line basis over the applicable vesting period of each award, based on the value of the awards on their grant date, as adjusted for forfeitures. Refer to Note 9 for additional information on the awards issued to certain employees of the affiliate portfolio companies.
On January 1, 2021, the Company issued awards to certain employees of Simply Self Storage which had a grant date fair value of $3.6 million. The Simply Self Storage awards are subject to certain performance conditions and a four-year service period. As such, if the Company determines it is probable that the performance conditions will be met, the value of the award will be amortized over the four-year service period, as adjusted for forfeitures. As of September 30, 2021, the Company determined it was probable that the performance conditions will be met. During the three and nine months ended September 30, 2021, the Company recorded $0.2 million and $0.6 million, respectively, of compensation expense related to such awards, which was included as a component of Rental Property Operating Expense in the Company’s Condensed Consolidated Statements of Operations. As of September 30, 2021, the total
12


unrecognized compensation cost relating to the Simply Self Storage awards was $2.6 million and is expected to be recognized over a period of 3.3 years from September 30, 2021.
Recent Accounting Pronouncements
In April 2020, the Financial Accounting Standards Board (“FASB”) staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. In accordance with the Lease Modification Q&A, the Company has made a policy election to not account for concessions as a lease modification if the total cash flows after the lease concessions are substantially the same, or less than, the cash flows in the original lease. However, if in the future, a concession is granted that modifies the terms and significantly alters the cash flows of the original lease, the Company will account for the changes as a lease modification. The Company has granted concessions as a result of the COVID-19 pandemic to certain tenants to defer rental payments until a later date. The Company continued to recognize rental revenue for such tenants during the nine months ended September 30, 2021, while also considering any necessary bad debt reserves.
In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional expedients and exceptions to GAAP requirements for modifications on debt instruments, leases, derivatives, and other contracts, related to the expected market transition from LIBOR, and certain other floating rate benchmark indices (collectively, “IBORs”) to alternative reference rates. ASU 2020-04 generally considers contract modifications related to reference rate reform to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination. In January 2021, the FASB issued ASU 2021-01 “Reference Rate Reform (Topic 848): Scope,” or ASU 2021-01. ASU 2021-01 clarifies that the practical expedients in ASU 2020-04 apply to derivatives impacted by changes in the interest rate used for margining, discounting, or contract price alignment. The guidance in ASU 2020-04 is optional and may be elected over time, through December 31, 2022, as reference rate reform activities occur. Once ASU 2020-04 is elected, the guidance must be applied prospectively for all eligible contract modifications. The Company has not adopted any of the optional expedients or exceptions as of September 30, 2021, but will continue to evaluate the possible adoption of any such expedients or exceptions during the effective period as circumstances evolve.
3. Investments in Real Estate
Investments in real estate, net consisted of the following ($ in thousands):
September 30, 2021December 31, 2020
Building and building improvements$35,984,871 $25,991,610 
Land and land improvements9,510,255 7,626,381 
Furniture, fixtures and equipment659,207 495,395 
Right of use asset - operating leases(1)
114,535 114,535 
Right of use asset - financing leases(1)
72,862 56,008 
Total46,341,730 34,283,929 
Accumulated depreciation and amortization(2,745,641)(1,826,216)
Investments in real estate, net$43,596,089 $32,457,713 
 
(1)Refer to Note 14 for additional details on the Company’s leases.
13


Acquisitions
During the nine months ended September 30, 2021, the Company acquired interests in 32 real estate investments for $12.5 billion, which comprised 67 residential properties, 37 industrial properties, two data center properties, two self storage properties, one retail property, and one office property.
The following table details the properties acquired during the nine months ended September 30, 2021 ($ in thousands):
SegmentsNumber of TransactionsNumber of PropertiesSq. Ft. (in thousands)/Units
Purchase Price(1)
Residential properties(2)
216725,329 units$11,345,228 
Industrial properties6375,114 sq. ft.614,156 
Data center properties12430 sq. ft.180,057 
Self storage properties22131 sq. ft.19,938 
Retail properties11296 sq. ft.80,312 
Office properties11361 sq. ft.251,171 
32110$12,490,862 
 
(1)Purchase price is inclusive of acquisition-related costs.
(2)Purchase price includes the 11,525 wholly-owned single family homes related to the acquisition of Home Partners of America ("HPA"), which are not included in the number of properties. Refer to Note 4 for details on the unconsolidated homes acquired in the HPA transaction.

The following table details the purchase price allocation for the properties acquired during the nine months ended September 30, 2021 ($ in thousands):
 Amount
Building and building improvements$9,806,490 
Land and land improvements1,972,873 
Furniture, fixtures and equipment163,743 
In-place lease intangibles266,156 
Above-market lease intangibles909 
Below-market lease intangibles(13,543)
Brokerage firm relationship intangibles50,000 
Trade name intangibles40,000 
Management contract intangibles39,000 
Other165,234 
Total purchase price12,490,862 
Assumed debt(1)
2,353,084 
Net purchase price$10,137,778 
 
(1)Refer to Note 6 for additional details on the Company’s debt, which includes mortgage notes, term loans, and secured revolving credit facilities.
The weighted-average amortization periods for the acquired in-place lease intangibles, above-market lease intangibles, and below-market lease intangibles of the properties acquired during the nine months ended September 30, 2021 were three, five, and thirteen years, respectively.
14


Dispositions
The following table details the dispositions during the three and nine months ended September 30, 2021 and 2020 ($ in thousands):
Three Months Ended
September 30, 2021
Nine Months Ended
September 30, 2021
SegmentsNumber of PropertiesNet ProceedsNet LossNumber of PropertiesNet ProceedsNet Gain
Residential properties(1)
4$99,598 $(9,586)9$194,575 $13,216 
 4$99,598 $(9,586)9$194,575 $13,216 
Three Months Ended
September 30, 2020
Nine Months Ended
September 30, 2020
SegmentsNumber of PropertiesNet ProceedsNet GainNumber of PropertiesNet ProceedsNet Gain
Residential properties6$246,244 $64,885 6$246,244 $64,885 
Hotel properties1134,537 35,185 1134,537 35,185 
Industrial properties— — 14,488 371 
7$380,781 $100,070 8$385,269 $100,441 
(1)Net proceeds and net gain/(loss) include 111 single family rental homes sold during the three and nine months ended September 30, 2021.
 Properties Held for Sale
As of September 30, 2021, one industrial property was classified as held for sale. There were no properties classified as held for sale as of December 31, 2020. The held for sale assets and liabilities are components of Other Assets and Other Liabilities, respectively, on the Condensed Consolidated Balance Sheets.
The following table details the assets and liabilities of the Company’s properties classified as held for sale ($ in thousands):
Assets:September 30, 2021
Investments in real estate, net$21,670 
Other assets681 
Total assets$22,351 
Liabilities:
Other liabilities$302 
Total liabilities$302 
 Impairment
The Company reviews its real estate investments for impairment each quarter or when there is an event or change in circumstances that indicates an impaired value. If the GAAP depreciated cost basis of a real estate investment exceeds the expected undiscounted future cash flows of such real estate investment, the investment is considered impaired and the GAAP depreciated cost basis is reduced to the estimated fair value of the investment. During the three and nine months ended September 30, 2021, the Company did not recognize any impairments. During the three and nine months ended September 30, 2020, the Company recognized a $6.2 million impairment charge on one of its hotel properties and an aggregate $12.3 million impairment charge on two of its hotel properties, respectively. The impairment charge was a result of updates to the undiscounted cash flow assumptions for such asset to reflect a decrease in occupancy and future cash flows as a result of the COVID-19 pandemic.


15


4. Investments in Unconsolidated Entities
The Company holds investments in joint ventures that it accounts for under the equity method of accounting, as the Company’s ownership interest in each joint venture does not meet the requirements for consolidation. The joint ventures include 9,526 single family rental properties, 80 industrial properties, 48 data center properties, and two net lease properties. Refer to Note 2 for additional details.
The following table details the Company’s equity investment in unconsolidated entities as of September 30, 2021 and December 31, 2020 ($ in thousands):
Investment in Joint VentureSegmentOwnership
Interest
September 30, 2021December 31, 2020
QTS Data Centers(1)
Data Centers50.1%$2,012,362 $— 
MGM Grand & Mandalay Bay(2)
Net Lease49.9%821,422 816,220 
Home Partners of America JVs(3)
Residential12.2% - 27.8%593,738 — 
Alaska Logistics Portfolio(4)
Industrial26.7%266,961 — 
Total unconsolidated entities at historical cost3,694,483 816,220 
WC Infill Industrial PortfolioIndustrial85.0%329,457 — 
Vault Industrial PortfolioIndustrial46.0%228,942 — 
Total unconsolidated entities at fair value558,399 — 
Total $4,252,882 $816,220 
(1)The Company along with certain Blackstone-managed investment vehicles formed a joint venture ("QTS Data Centers") and acquired all outstanding shares of common stock of QTS Realty Trust ("QTS"). The Company's interest in QTS Data Centers is through a consolidated joint venture, whereby the non-controlling interest is a Blackstone-managed investment vehicle. As of September 30, 2021, the Company's investment includes $577.5 million attributable to such other Blackstone-managed investment vehicles. 
(2)Includes $9.3 million and $9.4 million of BREIT outside basis attributable to the MGM Grand & Mandalay Bay joint venture as of September 30, 2021 and December 31, 2020, respectively.
(3)Includes $315.4 million of BREIT outside basis attributable to the Home Partners of America JVs as of September 30, 2021.
(4)The Company along with certain Blackstone-managed investment vehicles formed a joint venture ("Alaska Logistics Portfolio") and acquired a portfolio of logistics properties.

16


The following table details the Company’s income from unconsolidated entities for the three and nine months ended September 30, 2021 ($ in thousands):
Three Months Ended September 30, 2021
Investment in Joint VentureOwnership
Interest
Total
Revenue of Unconsolidated Joint Ventures
Net Income (Loss) of Unconsolidated Joint VenturesBREIT's
Share
Amortization of Outside BasisBREIT Income
(Loss) from Unconsolidated Entities
QTS Data Centers(1)
50.1%$53,073 $(33,972)$(17,020)$— $(17,020)
MGM Grand & Mandalay Bay49.9%98,681 50,001 24,951 (37)24,914 
Home Partners of America JVs12.2% - 27.8%56,865 (4,634)(1,110)(7,505)(8,615)
Alaska Industrial Portfolio26.7%20,755 796 212 — 212 
WC Infill Industrial Portfolio(2)
85.0%— — — — 43,911 
Vault Industrial Portfolio(2)
46.0%— — — — 35,043 
Total $78,445 
Nine Months Ended September 30, 2021
Investment in Joint VentureOwnership
Interest
Total
Revenue of Unconsolidated Joint Ventures
Net Income (Loss) of Unconsolidated Joint VenturesBREIT's
Share
Amortization of Outside BasisBREIT Income (Loss) from Unconsolidated Entities
QTS Data Centers(1)
50.1%$53,073 $(33,972)$(17,020)$— $(17,020)
MGM Grand & Mandalay Bay49.9%296,044 151,314 75,506 (110)75,396 
Home Partners of America JVs12.2% - 27.8%56,865 (4,634)(1,110)(7,505)(8,615)
Alaska Industrial Portfolio26.7%20,755 796 212 — 212 
WC Infill Industrial Portfolio(2)
85.0%— — — — 75,247 
Vault Industrial Portfolio(2)
46.0%— — — — 57,935 
Total$183,155 
 
(1)BREIT Income (Loss) from Unconsolidated Entities includes $4.9 million of loss attributable to a Blackstone-managed investment vehicle for the three and nine months ended September 30, 2021. The Company reflects this amount within net loss attributable to non-controlling interests.
(2)The Company elected the fair value option for these investments. Therefore, the income from unconsolidated entities represents the change in estimated fair value of the Company’s investment in such entities.
The following table details the Company’s income from unconsolidated entities for the three and nine months ended September 30, 2020 ($ in thousands):
Three Months Ended September 30, 2020
Investment in Joint VentureOwnership
Interest
Total
Revenue
Net Income of Unconsolidated Joint VenturesBREIT's
Share
Amortization of Outside BasisBREIT
Income from Unconsolidated Entities
MGM Grand & Mandalay Bay49.9%$98,682 $50,320 $25,110 $(37)$25,073 
Nine Months Ended September 30, 2020
Investment in Joint VentureOwnership
Interest
Total
Revenue
Net Income of Unconsolidated Joint VenturesBREIT's
Share
Amortization of Outside BasisBREIT
Income from Unconsolidated Entities
MGM Grand & Mandalay Bay49.9%$247,800 $127,799 $63,772 $(94)$63,678 
=
 
17


5. Investments in Real Estate Debt
The following tables detail the Company’s investments in real estate debt ($ in thousands):
September 30, 2021
Type of Security/Loan
Weighted
Average
Coupon(1)
Weighted
Average
Maturity Date(2)
Face
Amount
Cost
Basis
Fair
Value
CMBS(3)
L+2.7%6/2/2026$5,031,213 $4,939,962 $4,957,915 
Corporate bonds4.8%12/26/2027166,242 166,242 168,594 
RMBS3.8%2/13/2051103,008 102,959 103,078 
Total real estate securities3.6%12/15/20265,300,463 5,209,163 5,229,587 
Commercial real estate loansL+3.9%2/12/20251,480,951 1,463,893 1,467,521 
Other investments(4)
3.7%7/25/2029235,956 205,887 205,887 
Total investments in real estate debtL+2.7%8/23/2026$7,017,370 $6,878,943 $6,902,995 
 December 31, 2020
Type of Security/Loan
Weighted
Average
Coupon(1)
Weighted
Average
Maturity Date(2)
Face
Amount
Cost
Basis
Fair
Value
CMBS(3)
L+2.0%1/17/2026$4,093,201 $3,949,824 $3,753,428 
Corporate bonds5.0%5/3/2027179,398 178,219 183,203 
RMBS4.5%10/24/204922,429 22,602 22,510 
Total real estate securities3.2%3/29/20264,295,028 4,150,645 3,959,141 
Commercial real estate loansL+3.8%8/8/2022623,574 572,869 607,165 
Total investments in real estate debtL+2.2%10/3/2025$4,918,602 $4,723,514 $4,566,306 
 
(1)The term “L” refers to the relevant floating benchmark rates, which include USD LIBOR, GBP LIBOR, EURIBOR, SOFR and SONIA, as applicable to each security and loan. Fixed rate CMBS and Commercial real estate loans are reflected as a spread over the relevant floating benchmark rates, as of September 30, 2021 and December 31, 2020, respectively, for purposes of the weighted-averages. Weighted Average Coupon for CMBS does not include zero coupon securities. As of September 30, 2021, we have interest rate swaps outstanding with a notional value of $1.1 billion that effectively converts a portion of our fixed rate investments in real estate debt to floating rates.
(2)Weighted average maturity date is based on the fully extended maturity date of the instrument or, in the case of CMBS and RMBS, the underlying collateral.
(3)Face amount excludes interest-only securities with a notional amount of $3.4 billion and $2.3 billion as of September 30, 2021 and December 31, 2020, respectively. In addition, CMBS includes zero coupon securities of $208.8 million and $236.1 million as of September 30, 2021 and December 31, 2020, respectively.
(4)Includes an interest in an unconsolidated joint venture that holds investments in real estate debt securities.
The following table details the collateral type of the properties securing the Company’s investments in real estate debt ($ in thousands):
 September 30, 2021December 31, 2020
Collateral(1)
Cost
Basis
Fair
Value
Percentage Based on Fair ValueCost
Basis
Fair
Value
Percentage Based on Fair Value
Hospitality$1,940,260 $1,927,752 27%$2,046,529 $1,904,256 42%
Industrial1,786,310 1,778,578 26%612,884 610,504 13%
Residential1,582,301 1,627,865 24%748,086 797,840 17%
Office673,590 657,776 10%720,665 681,596 15%
Diversified428,523 432,214 6%234,527 225,077 5%
Other343,588 342,279 5%238,202 213,654 5%
Net Lease106,996 119,705 2%105,246 117,219 3%
Retail17,375 16,826 –%17,375 16,160 —%
Total$6,878,943 $6,902,995 100%$4,723,514 $4,566,306 100%
(1)Residential investments in real estate debt are collateralized by various forms of rental housing including apartments and single-family homes.
18


The following table details the credit rating of the Company’s investments in real estate debt ($ in thousands):
 September 30, 2021December 31, 2020
Credit RatingCost
Basis
Fair
Value
Percentage Based on Fair ValueCost
Basis
Fair
Value
Percentage Based on Fair Value
AAA$25,780 $25,743 —%$10,044 $10,047 —%
AA668 667 —%776 779 —%
A225,232 237,088 3%262,097 267,023 6%
BBB409,843 410,103 6%797,918 753,393 17%
BB1,483,674 1,493,393 22%1,435,891 1,381,221 30%
B1,571,261 1,557,244 23%1,186,975 1,114,977 24%
CCC35,209 36,325 1%32,402 34,839 1%
Private Commercial Real Estate Loans1,383,802 1,386,566 20%522,306 555,291 12%
Not Rated1,743,474 1,755,866 25%475,105 448,736 10%
Total$6,878,943 $6,902,995 100%$4,723,514 $4,566,306 100%
 
During the three and nine months ended September 30, 2021, the Company recognized $59.4 million and $151.6 million, respectively, of interest income related to investments in real estate debt. During the three and nine months ended September 30, 2020, the Company recognized $47.2 million and $149.0 million, respectively, of interest income related to investments in real estate debt. Interest income is included as a component of Income from Investments in Real Estate Debt on the Company’s Condensed Consolidated Statements of Operations.

During the three and nine months ended September 30, 2021, the Company recorded a net unrealized loss of $21.4 million and a net unrealized gain of $181.3 million, respectively, related to investments in real estate debt. During the three and nine months ended September 30, 2020, the Company recorded a net unrealized gain of $186.9 million and a net unrealized loss $361.8 million, respectively, related to investments in real estate debt. Such unrealized gains and losses were recorded as a component of Income from Investments in Real Estate Debt on the Company’s Condensed Consolidated Statements of Operations.
During the three and nine months ended September 30, 2021, the Company recognized a net realized gain of $13.1 million and $27.7 million, respectively, due to the sale, repayment, or partial repayment of certain of the Company’s investments in real estate debt. During the three and nine months ended September 30, 2020, the Company recognized a net realized loss of $6.5 million and $11.2 million, respectively, due to the sale, repayment, or partial repayment of certain of the Company’s investments in real estate debt.

The Company’s investments in real estate debt included certain CMBS and loans collateralized by properties owned by Blackstone-advised investment vehicles. The following table details the Company’s investments in affiliated real estate debt ($ in thousands):
 Fair ValueIncome (Loss)
Three Months Ended September 30,Nine Months Ended September 30,
 September 30, 2021December 31, 20202021202020212020
CMBS$2,623,436 $1,749,877 $4,680 $99,959 $101,626 $(84,180)
Commercial real estate loans539,175 545,539 (7,795)35,315 (11,895)45,307 
Total$3,162,611 $2,295,416 $(3,115)$135,274 $89,731 $(38,873)
For additional information regarding the Company’s investments in affiliated real estate debt, see Note 5 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The terms and conditions of such affiliated real estate debt held as of September 30, 2021 are consistent with the terms described in such Note.
As of September 30, 2021 and December 31, 2020, the Company’s investments in real estate debt also included $457.5 million and $179.6 million, respectively, of CMBS collateralized, in part, by certain of the Company’s mortgage notes. The Company recognized $7.0 million and $28.5 million of income related to such CMBS during the three and nine months ended September 30, 2021, respectively. The Company recognized $11.7 million of income and $7.3 million of losses related to such CMBS during the three and nine months ended September 30, 2020, respectively.
19


6. Mortgage Notes, Term Loans, and Secured Revolving Credit Facilities
The following table details the mortgage notes, term loans, and secured revolving credit facilities secured by the Company’s real estate ($ in thousands):
 September 30, 2021Principal Balance Outstanding
Indebtedness
Weighted
Average
Interest Rate(1)
Weighted
Average
Maturity Date (2)(3)
Maximum
Facility Size
September 30, 2021December 31, 2020
Fixed rate loans:     
Fixed rate mortgages3.5%8/31/2027N/A$14,158,332 $13,124,595 
Variable rate loans:
Variable rate mortgages and term loansL+1.7%9/27/2025N/A9,653,874 6,305,964 
Variable rate secured revolving credit facilitiesL+1.5%10/28/2025$2,185,344 729,325 481,725 
Variable rate warehouse facilitiesL+2.1%9/27/2022$1,875,000 484,023 — 
Variable rate mezzanine loansL+3.5%3/9/2025N/A71,100 202,200 
Total variable rate loansL+1.8%8/11/202510,938,322 6,989,889 
Total loans secured by real estate2.8%10/8/202625,096,654 20,114,484 
Premium on assumed debt, net28,361 15,191 
Deferred financing costs, net(158,839)(153,514)
Mortgage notes, term loans, and secured revolving credit facilities, net$24,966,176 $19,976,161 
 
(1)The term “L” refers to the relevant floating benchmark rates, which include one-month LIBOR, 30-day SOFR, and one-month CDOR, as applicable to each loan. 
(2)For loans where the Company, at its sole discretion, has extension options, the maximum maturity date has been assumed.
(3)The majority of the Company’s mortgages contain yield or spread maintenance provisions.
The following table details the future principal payments due under the Company’s mortgage notes, term loans, and secured revolving credit facilities as of September 30, 2021 ($ in thousands):
YearAmount
2021 (remaining)$399,618 
2022752,619 
2023904,478 
20243,692,043 
20254,661,846 
20265,605,063 
Thereafter9,080,987 
Total$25,096,654 
 
During the three and nine months ended September 30, 2021 and 2020, the Company repaid certain of its loans at amounts in excess of their carrying value in conjunction with the sale of the underlying property or a refinancing. As such, the Company incurred a realized loss on extinguishment of debt of $3.4 million and $9.5 million, respectively, for the three and nine months ended September 30, 2021. The Company incurred a realized loss on extinguishment of debt of $5.3 million and $6.5 million, respectively, for the three and nine months ended September 30, 2020. Such losses result from the acceleration of related deferred financing costs, prepayment penalties, and transactions costs and are recorded on the Company’s Condensed Consolidated Statements of Operations.
 
The Company is subject to various financial and operational covenants under certain of its mortgage notes, term loans, and secured revolving credit facility agreements. These covenants require the Company to maintain certain financial ratios, which may include leverage, debt yield, and debt service coverage, among others. As of September 30, 2021, the Company believes it was in compliance with all of its loan covenants that could result in a default under such agreements, and with respect to the other financial ratio-based covenants, the Company has provided limited guarantees to allow the applicable collateral real estate to continue to distribute their cash flow to the Company.
20


7. Secured Financings of Investments in Real Estate Debt
The Company has entered into master repurchase agreements and other financing agreements with lenders to provide additional financing capacity secured by certain of its investments in real estate debt. The terms of the master repurchase agreements and other financing agreements provide the lenders the ability to determine the size and terms of the financing provided based upon the particular collateral pledged by the Company from time-to-time, and may require the Company to provide additional margin in the form of cash, securities, or other forms of collateral should the market value of the pledged investments decline. 
The following tables detail the Company’s secured financings of investments in real estate debt ($ in thousands):
 September 30, 2021
Borrowings Outstanding
Collateral Assets(1)
Weighted Average
Interest Rate (2)
Weighted Average Maturity Date
CMBS$2,381,296 $4,118,078 L+0.9%8/12/2022
Term Loans236,241 363,447 L+1.8%4/2/2022
Corporate Bonds103,396 158,820 L+0.8%8/13/2022
RMBS46,466 74,030 L+0.9%8/29/2022
$2,767,399 $4,714,375 L+1.0%
 
 December 31, 2020
Borrowings Outstanding
Collateral Assets(1)
Weighted Average
Interest Rate (2)
Weighted Average Maturity Date
CMBS$1,733,623 $2,697,714 L+1.6%6/21/2021
Term Loans292,406 452,578 L+1.8%3/17/2022
Corporate Bonds111,540 138,215 L+0.8%3/6/2021
RMBS3,424 4,646 L+1.5%3/30/2021
$2,140,993 $3,293,153 L+1.6%
 
(1)Represents the fair value of the Company’s investments in real estate debt that serve as collateral.
(2)The term “L” refers to the relevant floating benchmark rates, which include USD LIBOR, GBP LIBOR, EURIBOR, and SONIA, as applicable to each secured financing.
 
8. Unsecured Revolving Credit Facilities
The Company is party to an unsecured revolving credit facility with multiple banks. The credit facility expires on February 22, 2024 and may be extended for one year. Interest under the credit facility is determined based on LIBOR plus 2.5%. As of September 30, 2021, the capacity of the credit facility was $1.9 billion. As of December 31, 2020, the Company had a $23.5 million letter of credit outstanding, which reduced the available capacity of the unsecured credit facility. No such letter of credit was outstanding as of September 30, 2021. There were no other outstanding borrowings on the unsecured credit facility as of September 30, 2021 and December 31, 2020.
The Company also maintains a $100.0 million unsecured revolving credit facility with an affiliate of Blackstone of which there was no outstanding balance as of September 30, 2021 or December 31, 2020. For additional information regarding the affiliate credit facility, see Note 8 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.
21


9. Related Party Transactions
Due to Affiliates
The following table details the components of due to affiliates ($ in thousands): 
September 30, 2021December 31, 2020
Accrued stockholder servicing fee$1,028,882 $605,411 
Performance participation allocation892,410 192,648 
Accrued management fee44,778 22,253 
Accrued affiliate service provider expenses9,004 10,151 
Advanced organization and offering costs2,557 4,090 
Other2,296 53,107 
Total$1,979,927 $887,660 
Accrued Stockholder Servicing Fee
The Company accrues the full amount of the future stockholder servicing fees payable to Blackstone Securities Partners L.P. (the “Dealer Manager”), a registered broker dealer affiliated with the Adviser, for Class S, Class T, and Class D shares up to the 8.75% of gross proceeds limit at the time such shares are sold. The Dealer Manager has entered into agreements with the selected dealers distributing the Company’s shares in the Offering, which provide, among other things, for the re-allowance of the full amount of the selling commissions and dealer manager fee and all or a portion of the stockholder servicing fees received by the Dealer Manager to such selected dealers.
Performance Participation Allocation
The Special Limited Partner holds a performance participation interest in BREIT OP that entitles it to receive an allocation of BREIT OP’s total return. Total return is defined as distributions paid or accrued plus the change in the Company’s Net Asset Value ("NAV"). Under the BREIT OP agreement, the annual total return will be allocated solely to the Special Limited Partner only after the other unit holders have received a total return of 5% (after recouping any loss carryforward amount) and such allocation will continue until the allocation between the Special Limited Partner and all other BREIT OP unit holders is equal to 12.5% and 87.5%, respectively. Thereafter, the Special Limited Partner will receive an allocation of 12.5% of the annual total return. The allocation of the performance participation interest is ultimately determined at the end of each calendar year and will be paid in Class I or Class B units of BREIT OP or cash, at the election of the Special Limited Partner. During the three and nine months ended September 30, 2021, the Company recognized $449.8 million and $892.4 million, respectively, of Performance Participation Allocation expense in the Company’s Condensed Consolidated Statements of Operations as the performance hurdle was achieved as of September 30, 2021. During the three and nine months ended September 30, 2020, the Company recognized no Performance Participation Allocation expense as the performance hurdle was not achieved as of and September 30, 2020.
In January 2021, the Company issued 15.5 million Class I units and 1.1 million Class B units in BREIT OP to the Special Limited Partner as payment of the 2020 performance participation allocation. Such units were issued at the NAV per unit as of December 31, 2020. Subsequent to the issuance of the Class I units and Class B units, 9.7 million of such units were redeemed for $111.9 million, and 1.1 million of such units were exchanged for unregistered Class I shares in the Company. As of September 30, 2021, Blackstone and its employees, including the Company’s executive officers, continue to own shares of the Company and Class I and Class B units of BREIT OP worth an aggregate $534.5 million.
Accrued Management Fee
The Adviser is entitled to an annual management fee equal to 1.25% of the Company’s NAV, payable monthly, as compensation for the services it provides to the Company. The management fee can be paid, at the Adviser’s election, in cash, shares of the Company's common stock, or BREIT OP units. To date, the Adviser has elected to receive the management fee in shares of the Company’s common stock. During the three and nine months ended September 30, 2021, the Company incurred management fees of $122.9 million and $288.1 million, respectively. During the three and nine months ended September 30, 2020, the Company incurred management fees of $57.6 million and $160.5 million, respectively.
During the nine months ended September 30, 2021 and 2020, the Company issued 19.6 million and 13.0 million unregistered Class I shares, respectively, to the Adviser as payment for management fees. The Company also had a payable of $44.8 million and $22.3 million related to the management fees as of September 30, 2021 and December 31, 2020, respectively, which is included in Due to
22


Affiliates on the Company’s Condensed Consolidated Balance Sheets. During October 2021, the Adviser was issued 3.3 million unregistered Class I shares as payment for the $44.8 million management fees accrued as of September 30, 2021. The shares issued to the Adviser for payment of the management fee were issued at the applicable NAV per share at the end of each month for which the fee was earned. During the nine months ended September 30, 2021, the Adviser submitted 10.4 million Class I shares for repurchase, for a total repurchase amount of $121.4 million. During the nine months ended September 30, 2020, the Adviser submitted 8.4 million Class I shares for repurchase, for a total repurchase amount of $89.5 million.
Accrued affiliate service provider expenses and incentive compensation awards
For further details on the Company’s relationships with its affiliated service providers, see Note 9 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. The Company issues incentive compensation awards to certain employees of affiliate portfolio company service providers that entitles them to receive an allocation of the Company’s total return over a certain hurdle amount, as determined by the Company, which is considered a performance condition.  If it is considered probable that the performance condition will be met, these awards are amortized over the four-year service period, as adjusted for forfeitures. As of September 30, 2021, the Company has determined it is probable that the performance condition will be met and has amortized the value of such awards over the applicable service period. None of Blackstone, the Adviser, or the affiliate portfolio company service providers receive any incentive compensation from the aforementioned arrangements.
The following table details the incentive compensation awards ($ in thousands):
    September 30, 2021
Plan YearUnrecognized Compensation Cost as of December 31, 2020Value of New Awards IssuedAmortization of Compensation Cost for the Nine Months Ended September 30, 2021Unrecognized Compensation CostRemaining Amortization Period
2019$3,363 $— $(852)$1,835 1.3 years
2020— — — — 
2021— 8,500 (1,594)6,906 3.3 years
 $3,363 $8,500 $(2,446)$8,741 
The following table details the amounts incurred for affiliate service providers during the three and nine months ended September 30, 2021 and 2020 ($ in thousands):
Affiliate Service
Provider Expenses
Three Months Ended September 30,
Amortization of
Affiliate Service Provider
Incentive Compensation
 Three Months Ended September 30,
Capitalized Transaction
Support Services
Three Months Ended September 30,
 202120202021202020212020
Link Industrial Properties L.L.C.$16,363 $13,312 $394 $(16)$458 $2,373 
LivCor, L.L.C.9,651 7,150 441 (5)2,227 772 
BRE Hotels and Resorts LLC2,794 4,012 119 (9)— — 
ShopCore Properties TRS Management LLC1,471 1,411 15 (1)171 107 
Revantage Corporate Services, L.L.C.899 440 — 1,271 — 
Equity Office Management, L.L.C.418 170 — — 
Total$31,596 $26,495 $976 $(31)$4,127 $3,252 
Affiliate Service
Provider Expenses
Nine Months Ended
September 30,
Amortization of Affiliate
Service Provider Incentive
Compensation Awards
Nine Months Ended
September 30,
Capitalized Transaction
Support Services
Nine Months Ended
September 30,
202120202021202020212020
Link Industrial Properties L.L.C.$48,322 $39,334 $999 $505 $1,276 $2,926 
LivCor, L.L.C.30,569 19,474 1,138 149 4,302 2,533 
BRE Hotels and Resorts LLC8,237 11,661 246 303 — — 
ShopCore Properties TRS Management LLC4,366 3,532 40 12 253 422 
Revantage Corporate Services, L.L.C.2,278 1,397 — — 1,271 — 
Equity Office Management, L.L.C.1,382 465 23 — — — 
Total$95,154 $75,863 $2,446 $969 $7,102 $5,881 
23



Affiliate service provider expenses and incentive compensation awards are included as a component of Rental Property Operating and Hospitality Operating expense, as applicable, in the Company’s Condensed Consolidated Statements of Operations. Transaction support service fees were capitalized to Investments in Real Estate on the Company’s Condensed Consolidated Balance Sheets. Neither Blackstone nor the Adviser receives any fees from the aforementioned arrangements.
 
Other
As of September 30, 2021, and December 31, 2020, the Company had zero and $50.8 million, respectively, of accrued repurchases of Class I shares due to the Adviser. Additionally, as of both September 30, 2021 and December 31, 2020, the Adviser had advanced $2.3 million of expenses on the Company’s behalf for general corporate expenses provided by unaffiliated third parties.  
Affiliate Title Service Provider
During the nine months ended September 30, 2021, the Company paid Lexington National Land Services $13.8 million for title services related to 29 investments and such costs were either (i) capitalized to Investments in Real Estate or (ii) recorded as deferred financing costs, which is a reduction to Mortgage Notes, Term Loans, and Secured Revolving Credit Facilities on the Company’s Condensed Consolidated Balance Sheets. For additional information regarding this affiliate relationship, see Note 9 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.
Captive Insurance Company
During the three and nine months ended September 30, 2021, the Company contributed $5.3 million and $49.5 million, respectively, of capital to the captive insurance company for insurance premiums and its pro rata share of other expenses. Of these amounts, $0.1 million and $0.9 million, respectively, was attributable to the fee paid to a Blackstone affiliate to provide oversight and management services of the captive insurance company. The capital contributed and fees paid are in place of insurance premiums and fees that would otherwise be paid to third party insurance companies. The Company contributed $28.4 million of capital to the captive insurance company during the three and nine months ended September 30, 2020. Of these amounts, $0.5 million and $0.5 million, respectively, was attributable to the fee paid to a Blackstone affiliate to provide oversight and management services of the captive insurance company.
Other
As of both September 30, 2021 and December 31, 2020, the Company had a receivable of $3.9 million from LivCor, L.L.C. and such amounts are included in Other Assets on the Company’s Condensed Consolidated Balance Sheets.
10. Other Assets and Other Liabilities
The following table details the components of other assets ($ in thousands):
September 30, 2021December 31, 2020
Equity securities$2,700,130 $599,185 
Real estate intangibles, net808,990 738,259 
Pre-acquisition costs602,603 241 
Receivables, net282,801 109,159 
Straight-line rent receivable243,228 155,108 
Prepaid expenses89,172 50,092 
Single family rental homes retained risk retention securities82,422 — 
Deferred leasing costs, net69,038 49,533 
Derivatives53,478 — 
Held for sale assets22,351 — 
Deferred financing costs, net21,561 22,740 
Other89,774 74,936 
Total$5,065,548 $1,799,253 
24


The following table details the components of other liabilities ($ in thousands):
 
September 30, 2021December 31, 2020
Subscriptions received in advance$1,720,934 $508,817 
Real estate taxes payable250,154 117,362 
Payable for unsettled investments in real estate debt236,686 — 
Accounts payable and accrued expenses189,536 104,866 
Distribution payable158,156 90,892 
Intangible liabilities, net117,410 128,639 
Tenant security deposits108,618 57,489 
Prepaid rental income97,806 95,165 
Right of use lease liability - operating leases86,177 85,065 
Stock repurchases payable75,308 83,350 
Right of use lease liability - financing leases74,630 57,727 
Accrued interest expense51,865 50,065 
Derivatives22,860 55,536 
Held for sale liabilities302 — 
Other67,619 30,221 
Total$3,258,061 $1,465,194 

11. Intangibles
The gross carrying amount and accumulated amortization of the Company’s intangible assets and liabilities consisted of the following ($ in thousands):
 September 30, 2021December 31, 2020
Intangible assets:  
In-place lease intangibles$1,164,981 $1,094,561 
Indefinite life intangibles104,182 — 
Above-market lease intangibles44,982 49,261 
Other61,353 32,549 
Total intangible assets1,375,498 1,176,371 
Accumulated amortization:
In-place lease amortization(530,163)(407,256)
Above-market lease amortization(22,262)(20,291)
Other(14,083)(10,565)
Total accumulated amortization(566,508)(438,112)
Real estate intangibles, net$808,990 $738,259 
Intangible liabilities:
Below-market lease intangibles$196,238 $194,158 
Total intangible liabilities196,238 194,158 
Accumulated amortization:
Below-market lease amortization(78,828)(65,519)
Total accumulated amortization(78,828)(65,519)
Intangible liabilities, net$117,410 $128,639 
25


The estimated future amortization on the Company’s intangibles for each of the next five years and thereafter as of September 30, 2021 is as follows ($ in thousands):
 
 In-place Lease
Intangibles
Above-market
Lease Intangibles
Below-market
Lease Intangibles
2021 (remaining)$138,129 $1,881 $(7,585)
2022167,444 6,320 (27,708)
202391,470 4,207 (23,262)
202464,465 2,933 (18,695)
202550,402 2,299 (14,192)
202638,079 1,696 (10,447)
Thereafter84,829 3,384 (15,521)
 $634,818 $22,720 $(117,410)
 
12. Derivatives
The Company uses derivative financial instruments to minimize the risks and/or costs associated with the Company’s investments and financing transactions. The Company has not designated any of its derivative financial instruments as hedges as defined within ASC 815 – “Derivatives and Hedging”. Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements, fluctuations in foreign exchange rates, and other identified risks.
The use of derivative financial instruments involves certain risks, including the risk that the counterparties to these contractual arrangements do not perform as agreed. To mitigate this risk, the Company enters into derivative financial instruments with counterparties it believes to have appropriate credit ratings and that are major financial institutions with which the Company and its affiliates may also have other financial relationships.
Interest Rate Contracts
Certain of the Company’s transactions expose the Company to interest rate risks, which include exposure to variable interest rates on its secured financings of investments in real estate debt in addition to certain loans secured by the Company’s real estate. The Company uses derivative financial instruments, which includes interest rate swaps, and may also include interest rate caps, options, floors, and other interest rate derivative contracts, to limit the Company’s exposure to the future variability of interest rates.

The following tables detail the Company’s outstanding interest rate derivatives that were non-designated hedges of interest rate risk (notional amount in thousands):
 September 30, 2021
Interest Rate DerivativesNumber of InstrumentsNotional AmountStrikeIndexWeighted Average Maturity (Years)
Interest Rate Swaps - Investments in real estate debt54$1,140,710 1.0%LIBOR5.4
Interest Rate Swaps - Property debt6$1,500,000 1.1%LIBOR6.8
 December 31, 2020
Interest Rate DerivativesNumber of InstrumentsNotional AmountStrikeIndexWeighted Average Maturity (Years)
Interest Rate Swaps - Investments in real estate debt53$929,560 1.3%LIBOR6.3
 
Foreign Currency Forward Contracts
Certain of the Company’s international investments expose it to fluctuations in foreign currency exchange rates and interest rates. These fluctuations may impact the value of the Company’s cash receipts and payments in terms of its functional currency, the U.S. dollar. The Company uses foreign currency forward contracts to protect the value or fix the amount of certain investments or cash flows in terms of the U.S. dollar.
 
26


The following table details the Company’s outstanding foreign currency forward contracts that were non-designated hedges of foreign currency risk (notional amount in thousands):
 September 30, 2021December 31, 2020
Foreign Currency Forward ContractsNumber of InstrumentsNotional AmountNumber of InstrumentsNotional Amount
Buy USD / Sell EUR Forward15705,031 7219,430 
Buy USD / Sell GBP Forward9£311,988 2£25,093 
Buy EUR / Sell USD Forward9147,613 — 
Buy GBP / Sell USD Forward4£53,777 £— 
Valuation and Financial Statement Impact
The following table details the fair value of the Company’s derivative financial instruments ($ in thousands):
 
Fair Value of Derivatives
in an Asset(1) Position
Fair Value of Derivatives
in a Liability(2) Position
September 30, 2021December 31, 2020September 30, 2021December 31, 2020
Interest rate derivatives$19,922 $— $18,379 $46,144 
Foreign currency forward contracts33,556 — 4,481 9,392 
Total Derivatives$53,478 $— $22,860 $55,536 
(1)Included in Other Assets in the Company’s Condensed Consolidated Balance Sheets.
(2)Included in Other Liabilities in the Company’s Condensed Consolidated Balance Sheets.

The following table details the effect of the Company’s derivative financial instruments on the Condensed Consolidated Statements of Operations ($ in thousands):
 
Type of DerivativeRealized/Unrealized Gain (Loss)Location of Gain (Loss) Recognized in Net IncomeThree Months Ended September 30,
20212020
Foreign Currency Forward ContractRealized gain (loss)Income from investments in real estate debt$335 $(12,541)
Interest Rate Swap - Investments in real estate debtRealized lossIncome from investments in real estate debt(77)— 
Foreign Currency Forward ContractUnrealized gainIncome from investments in real estate debt18,514 4,018 
Interest Rate Swap – Investments in real estate debtUnrealized gainIncome from investments in real estate debt7,017 3,604 
Interest Rate Swap – Property debtUnrealized gainOther income (expense)7,995 — 
   $33,784 $(4,919)
Type of DerivativeRealized/Unrealized Gain (Loss)Location of Gain (Loss) Recognized in Net IncomeNine Months Ended September 30,
20212020
Foreign Currency Forward ContractRealized lossIncome from investments in real estate debt$(8,244)$(10,572)
Interest Rate Swap - Investments in real estate debtRealized lossIncome from investments in real estate debt(15,041)(1,711)
Foreign Currency Forward ContractUnrealized gain (loss)Income from investments in real estate debt38,479 (1,079)
Interest Rate Swap – Investments in real estate debtUnrealized gain (loss)Income from investments in real estate debt49,947 (59,659)
Interest Rate Swap – Property debtUnrealized lossOther income (expense)(2,151)— 
$62,990 $(73,021)
Credit-Risk Related Contingent Features
 
The Company has entered into agreements with certain of its derivative counterparties that contain provisions whereby if the Company were to default on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, the Company may also be declared in default under its derivative obligations. In addition, certain of the Company’s agreements with its derivative counterparties require the Company to post collateral based on a percentage of derivative notional amounts and/or to secure net liability positions.
27


As of September 30, 2021, the Company was in a net liability position with one of its derivative counterparties and posted collateral of $15.6 million under these derivative contracts, which amount is included in Restricted Cash on the Company’s Condensed Consolidated Balance Sheet. As of December 31, 2020, the Company was in a net liability position with two of its derivative counterparties and posted collateral of $55.9 million under these derivative contracts, which amount is included in Restricted Cash on the Company’s Condensed Consolidated Balance Sheet.
13. Equity and Redeemable Non-controlling Interest
Authorized Capital
As of September 30, 2021, the Company had the authority to issue 10,100,000,000 shares, consisting of the following:
ClassificationNumber of Shares
(in thousands)
Par Value
Preferred Stock100,000 $0.01 
Class S Shares3,000,000 $0.01 
Class I Shares6,000,000 $0.01 
Class T Shares500,000 $0.01 
Class D Shares500,000 $0.01 
Total10,100,000 
Common Stock
The following table details the movement in the Company’s outstanding shares of common stock (in thousands):
 Three Months Ended September 30, 2021
 Class SClass IClass TClass DTotal
June 30, 2021921,838 1,326,271 50,188 181,506 2,479,803 
Common stock issued156,140 364,057 3,671 61,255 585,123 
Distribution reinvestment6,488 8,280 341 1,325 16,434 
Common stock repurchased(2,969)(12,224)(254)(548)(15,995)
Independent directors' restricted stock grant(1)
— 56 — — 56 
September 30, 20211,081,497 1,686,440 53,946 243,538 3,065,421 
Nine Months Ended September 30, 2021
Class SClass IClass TClass DTotal
December 31, 2020702,853 927,080 45,943 124,141 1,800,017 
Common stock issued374,193 801,347 8,074 117,769 1,301,383 
Distribution reinvestment18,295 20,802 1,013 3,466 43,576 
Common stock repurchased(13,844)(62,850)(1,084)(1,838)(79,616)
Independent directors' restricted stock grant(1)
— 61 — — 61 
September 30, 20211,081,497 1,686,440 53,946 243,538 3,065,421 
 
(1)The independent directors’ restricted stock grant for the three months ended September 30, 2021 represents $0.1 million of the annual compensation paid to each of the independent directors. The cost of the grant is amortized over the the one year service period of such grant. The independent directors’ restricted stock grant for the nine months ended September 30, 2021 represents $0.1 million of the annual compensation paid to each of the independent directors and $0.1 million of the annual compensation paid to a new independent director, which has been prorated for the period from January 2021 through August 2021. The cost of the grant is amortized over the one year service period of such grant.
28


Share and Unit Repurchases
For the three months ended September 30, 2021, the Company repurchased 16.0 million shares of common stock for a total of $206.2 million. The Company did not repurchase any BREIT OP units during the three months ended September 30, 2021. For the nine months ended September 30, 2021, the Company repurchased 79.6 million shares of common stock and 9.8 million BREIT OP units for a total of $957.0 million and $113.4 million, respectively. The Company had no unfulfilled repurchase requests during the nine months ended September 30, 2021.
Distributions
The Company generally intends to distribute substantially all of its taxable income, which does not necessarily equal net income as calculated in accordance with GAAP, to its stockholders each year to comply with the REIT provisions of the Internal Revenue Code.
Each class of common stock receives the same gross distribution per share. The net distribution varies for each class based on the applicable stockholder servicing fee, which is deducted from the monthly distribution per share and paid directly to the applicable distributor.
The following table details the aggregate distributions declared for each applicable class of common stock for the three and nine months ended September 30, 2021:
 Three Months Ended September 30, 2021
 Class SClass IClass TClass D
Aggregate gross distributions declared per share of common stock$0.1637 $0.1637 $0.1637 $0.1637 
Stockholder servicing fee per share of common stock(0.0284)— (0.0280)(0.0082)
Net distributions declared per share of common stock$0.1353 $0.1637 $0.1357 $0.1555 
Nine Months Ended September 30, 2021
Class SClass IClass TClass D
Aggregate gross distributions declared per share of common stock$0.4852 $0.4852 $0.4852 $0.4852 
Stockholder servicing fee per share of common stock(0.0793)— (0.0782)(0.0229)
Net distributions declared per share of common stock$0.4059 $0.4852 $0.4070 $0.4623 
Redeemable Non-controlling Interest
In connection with its performance participation interest, the Special Limited Partner holds Class I units in BREIT OP. See Note 9 for further details of the Special Limited Partner’s performance participation interest. Because the Special Limited Partner has the ability to redeem its Class I units for Class I shares in the Company or cash, at the election of the Special Limited Partner, the Company has classified these Class I units as Redeemable Non-controlling Interest in mezzanine equity on the Company’s Condensed Consolidated Balance Sheets.
The following table details the redeemable non-controlling interest activity related to the Special Limited Partner for the nine months ended September 30, 2021 and 2020 ($ in thousands):
 
 September 30, 2021September 30, 2020
Balance at the beginning of the year$274 $272 
Settlement of prior year performance participation allocation192,648 141,396 
Repurchases(111,949)(83,625)
Conversion to Class I and Class B units(68,453)(48,543)
Conversion to Class I shares(12,246)(9,228)
GAAP income allocation(4)(13)
Distributions(12)(10)
Fair value allocation62 17 
Ending balance$320 $266 
In addition to the Special Limited Partner’s interest noted above, certain of the Company’s third party joint ventures also have a redeemable non-controlling interest in such joint ventures. As of September 30, 2021 and December 31, 2020, $80.5 million and $29.8
29


million, respectively, related to such third party joint ventures was included in Redeemable Non-controlling Interests on the Company’s Condensed Consolidated Balance Sheets.
The Redeemable Non-controlling Interests are recorded at the greater of (i) their carrying amount, adjusted for their share of the allocation of GAAP net income or loss and distributions, or (ii) their redemption value, which is equivalent to the fair value of such interests at the end of each measurement period. Accordingly, the Company recorded an allocation adjustment of $(24.8) million and $(34.5) million during the three and nine months ended September 30, 2021, respectively, between Additional Paid-in Capital and Redeemable Non-controlling Interest. The Company recorded an allocation adjustment of $(6.4) million and $(6.7) million during the three and nine months ended September 30, 2020, respectively, between Additional Paid-in Capital and Redeemable Non-controlling Interest.
14. Leases
Lessor
The Company’s rental revenue primarily consists of rent earned from operating leases at the Company’s residential, industrial, net lease, data centers, self storage, retail, and office properties. Leases at the Company’s industrial, data centers, retail, and office properties generally include a fixed base rent, and certain leases also contain a variable rent component. The variable component of the Company’s operating leases at its industrial, data centers, retail, and office properties primarily consist of the reimbursement of operating expenses such as real estate taxes, insurance, and common area maintenance costs. Rental revenue earned from leases at the Company’s residential properties primarily consist of a fixed base rent, and certain leases contain a variable component that allows for the pass-through of certain operating expenses such as utilities. Rental revenue earned from leases at the Company’s self storage properties primarily consist of a fixed base rent only.
Rental revenue from the Company’s lease at the Bellagio consists of a fixed annual rent that escalates annually throughout the term of the lease, and the tenant is generally responsible for all property-related expenses, including taxes, insurance, and maintenance. The Company assessed the classification of the Bellagio lease and determined the lease was an operating lease. The Company’s assessment included the consideration of the present value of the lease payments over the lease term and the residual value of the leased assets.
Leases at the Company’s industrial, net lease, data centers, retail, and office properties are generally longer term and may contain extension and termination options at the lessee’s election. Leases at the Company’s residential and self storage properties are short term in nature, generally not greater than 12 months in length.
The following table details the components of operating lease income from leases in which the Company is the lessor ($ in thousands):
 
 Three Months Ended September 30,Nine Months Ended September 30,
 2021202020212020
Fixed lease payments$737,811 $509,188 $1,944,920 $1,492,519 
Variable lease payments70,287 52,865 196,903 155,346 
Rental revenue$808,098 $562,053 $2,141,823 $1,647,865 
The following table presents the undiscounted future minimum rents the Company expects to receive for its industrial, net lease, data centers, retail, and office properties as of September 30, 2021 ($ in thousands). Leases at the Company’s residential and self storage properties are short term, generally 12 months or less, and are therefore not included.
YearFuture Minimum Rents
2021 (remaining)$264,974 
20221,039,042 
2023940,377 
2024831,443 
2025740,074 
2026653,059 
Thereafter9,045,865 
Total$13,514,834 
30


Lessee
Certain of the Company’s investments in real estate are subject to ground leases. The Company’s ground leases are classified as either operating leases or financing leases based on the characteristics of each lease. As of September 30, 2021, the Company had 15 ground leases classified as operating and three ground leases classified as financing. Each of the Company’s ground leases were acquired as part of the acquisition of real estate, and no incremental costs were incurred for such ground leases. The Company’s ground leases are non-cancelable, and two of the Company’s operating leases contain renewal options, one for an additional 99 year term and the other for an additional 10 year term.
The following table details the future lease payments due under the Company’s ground leases as of September 30, 2021 ($ in thousands):
 
 Operating
Leases
Financing
Leases
2021 (remaining)$1,061 $215 
20224,093 4,038 
20234,132 4,150 
20244,183 4,266 
20254,423 4,385 
20264,530 4,507 
Thereafter595,396 568,774 
Total undiscounted future lease payments617,818 590,335 
Difference between undiscounted cash flows and discounted cash flows(531,641)(515,705)
Total lease liability$86,177 $74,630 
 
The Company utilized its incremental borrowing rate, which was between 5% and 7%, to determine its lease liabilities. As of September 30, 2021, the weighted average remaining lease term of the Company’s operating leases and financing leases was 55 and 80 years, respectively.
Payments under the Company’s ground leases primarily contain fixed payment components that may include periodic increases fixed to an index or periodic fixed percentage escalations. One of the Company’s ground leases contains a variable component based on a percentage of revenue.
The following table details the fixed and variable components of the Company’s operating leases ($ in thousands):
 
 Three Months Ended September 30,Nine Months Ended September 30,
 2021202020212020
Fixed ground rent expense$1,031 $1,000 $3,078 $3,026 
Variable ground rent expense— 31 18 
Total cash portion of ground rent expense1,036 1,000 3,109 3,044 
Straight-line ground rent expense1,636 1,656 4,926 5,090 
Total operating lease costs$2,672 $2,656 $8,035 $8,134 
 The following table details the fixed and variable components of the Company’s financing leases ($ in thousands):
 Three Months Ended September 30,Nine Months Ended September 30,
 2021202020212020
Interest on lease liabilities$889 $759 $2,407 $2,233 
Amortization of right-of-use assets322 239 821 748 
Total financing lease costs$1,211 $998 $3,228 $2,981 
 
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15. Segment Reporting
The Company operates in nine reportable segments: Residential, Industrial, Net Lease, Data Centers, Hospitality, Self Storage, Retail, Office properties, and Investments in Real Estate Debt. The Company allocates resources and evaluates results based on the performance of each segment individually. The Company believes that Segment Net Operating Income is the key performance metric that captures the unique operating characteristics of each segment.
The following table details the total assets by segment ($ in thousands):
 September 30, 2021December 31, 2020
Residential$26,559,454 $13,701,615 
Industrial12,849,367 11,157,856 
Net Lease5,214,446 5,199,651 
Data Centers(1)
2,525,963 341,056 
Hospitality2,430,899 2,196,429 
Self Storage1,518,884 1,593,430 
Retail770,351 700,045 
Office1,010,578 447,630 
Investments in Real Estate Debt7,035,826 4,763,309 
Other (Corporate)3,532,834 582,994 
Total assets$63,448,602 $40,684,015 
(1) Previously included within the Industrial segment.
The following table details the financial results by segment for the three months ended September 30, 2021 ($ in thousands):  
ResidentialIndustrialNet
Lease
Data Centers(1)
HospitalitySelf
Storage
RetailOfficeInvestments in
Real Estate
Debt
Total
Revenues:
Rental revenue$416,749 $235,917 $82,795 $8,128 $— $36,529 $15,527 $12,453 $— $808,098 
Hospitality revenue— — — — 127,507 — — — — 127,507 
Other revenue36,195 1,825 — — 2,632 2,603 332 117 — 43,704 
Total revenues452,944 237,742 82,795 8,128 130,139 39,132 15,859 12,570 — 979,309 
Expenses:
Rental property operating219,456 69,157 440 1,061 — 16,430 4,767 2,706 — 314,017 
Hospitality operating— — — — 92,280 — — — — 92,280 
Total expenses219,456 69,157 440 1,061 92,280 16,430 4,767 2,706 — 406,297 
Income from unconsolidated entities(8,615)79,166 24,914 (17,020)— — — — — 78,445 
Income from investments in real estate debt— — — — — — — — 83,052 83,052 
Income (loss) from investments in equity securities148,553 15,573 10,761 — — — — (23,046)— 151,841 
Segment net operating income (loss)$373,426 $263,324 $118,030 $(9,953)$37,859 $22,702 $11,092 $(13,182)$83,052 $886,350 
Depreciation and amortization$(249,438)$(133,243)$(28,637)$(3,878)$(22,928)$(30,688)$(6,973)$(6,260)$— $(482,045)
General and administrative$(7,106)
Management fee(122,866)
Performance participation allocation(449,822)
Net loss on dispositions of real estate(9,586)
Interest income41 
Interest expense(204,538)
Loss on extinguishment of debt(3,372)
Other income (expense)25,790 
Net loss$(367,154)
Net loss attributable to non-controlling interests in third party joint ventures$5,472 
Net loss attributable to non-controlling interests in BREIT OP4,393 
Net loss attributable to BREIT stockholders$(357,289)
(1) Previously included within the Industrial segment.
32


The following table details the financial results by segment for the three months ended September 30, 2020 ($ in thousands):
ResidentialIndustrialNet
Lease
Data Centers(1)
HospitalitySelf
Storage
RetailOfficeInvestments in
Real Estate
Debt
Total
Revenues:
Rental revenue$244,691 $207,541 $82,795 $5,761 $— $4,541 $13,594 $3,130 $— $562,053 
Hospitality revenue— — — — 56,038 — — — — 56,038 
Other revenue13,026 1,479 — — 1,738 686 255 96 — 17,280 
Total revenues257,717 209,020 82,795 5,761 57,776 5,227 13,849 3,226 — 635,371 
Expenses:
Rental property operating122,266 61,234 156 768 — 2,618 5,163 1,101 — 193,306 
Hospitality operating— — — — 60,339 — — — — 60,339 
Total expenses122,266 61,234 156 768 60,339 2,618 5,163 1,101 — 253,645 
Income from unconsolidated entities— — 25,073 — — — — — — 25,073 
Income from investments in real estate debt— — — — — — — — 206,046 206,046 
Income (loss) from investments in equity securities(9,030)— 6,151 — — — — (6,771)— (9,650)
Segment net operating income$126,421 $147,786 $113,863 $4,993 $(2,563)$2,609 $8,686 $(4,646)$206,046 $603,195 
Depreciation and amortization$(133,696)$(133,453)$(28,667)$(2,525)$(22,296)$(2,396)$(7,978)$(1,588)$— $(332,599)
General and administrative$(5,430)
Management fee(57,619)
Performance participation allocation— 
Impairment of investments in real estate(6,217)
Net gain on dispositions of real estate100,070 
Interest income122 
Interest expense(174,193)
Loss on extinguishment of debt(5,258)
Other income (expense)398 
Net income$122,469 
Net loss attributable to non-controlling interests in third party joint ventures$593 
Net income attributable to non-controlling interests in BREIT OP(1,790)
Net income attributable to BREIT stockholders$121,272 
(1) Previously included within the Industrial segment.
33


The following table details the financial results by segment for the nine months ended September 30, 2021 ($ in thousands):
ResidentialIndustrialNet
Lease
Data Centers(1)
HospitalitySelf
Storage
RetailOfficeInvestments in
Real Estate
Debt
Total
Revenues:         
Rental revenue$1,007,297 $687,164 $248,384 $20,549 $— $101,177 $44,624 $32,628 $— $2,141,823 
Hospitality revenue— — — — 288,310 — — — — 288,310 
Other revenue68,735 7,819 — — 7,626 6,760 1,546 328 92,814 
Total revenues1,076,032 694,983 248,384 20,549 295,936 107,937 46,170 32,956 — 2,522,947 
Expenses:
Rental property operating510,039 213,306 910 2,975 — 49,391 14,302 8,784 — 799,707 
Hospitality operating— — — — 223,053 — — — — 223,053 
Total expenses510,039 213,306 910 2,975 223,053 49,391 14,302 8,784 — 1,022,760 
Income from unconsolidated entities(8,615)133,394 75,396 (17,020)— — — — — 183,155 
Income from investments in real estate debt— — — — — — — — 438,986 438,986 
Income (loss) from investments in equity securities300,048 70,984 41,724 — — — — (16,164)— 396,592 
Segment net operating income (loss)$857,426 $686,055 $364,594 $554 $72,883 $58,546 $31,868 $8,008 $438,986 $2,518,920 
Depreciation and amortization$(585,424)$(396,737)$(85,773)$(8,928)$(68,504)$(100,502)$(21,158)$(15,027)$— $(1,282,053)
General and administrative$(21,855)
Management fee(288,144)
Performance participation allocation(892,410)
Net gain on dispositions of real estate13,216 
Interest income136 
Interest expense(567,685)
Loss on extinguishment of debt(9,545)
Other income (expense)14,568 
Net loss$(514,852)
Net loss attributable to non-controlling interests in third party joint ventures$5,149 
Net loss attributable to non-controlling interests in BREIT OP6,129 
Net loss attributable to BREIT stockholders$(503,574)
(1) Previously included within the Industrial segment.
34


The following table details the financial results by segment for the nine months ended September 30, 2020 ($ in thousands):
 ResidentialIndustrialNet
Lease
Data Centers(1)
HospitalitySelf
Storage
RetailOfficeInvestments in
Real Estate Debt
Total
Revenues:         
Rental revenue$713,603 $607,033 $248,384 $17,249 $— $12,002 $40,516 $9,078 $— $1,647,865 
Hospitality revenue— — — — 205,291 — — — — 205,291 
Other revenue39,118 3,477 — — 4,575 1,597 761 316 — 49,844 
Total revenues752,721 610,510 248,384 17,249 209,866 13,599 41,277 9,394 — 1,903,000 
Expenses:
Rental property operating342,062 180,976 270 2,244 — 7,061 12,914 3,202 — 548,729 
Hospitality operating— — — — 204,168 — — — — 204,168 
Total expenses342,062 180,976 270 2,244 204,168 7,061 12,914 3,202 — 752,897 
Income from unconsolidated entities— — 63,678 — — — — — — 63,678 
Loss from investments in real estate debt— — — — — — — — (317,212)(317,212)
Income (loss) from investments in equity securities(14,823)13,571 (6,046)— — — — (6,644)— (13,942)
Segment net operating income$395,836 $443,105 $305,746 $15,005 $5,698 $6,538 $28,363 $(452)$(317,212)$882,627 
Depreciation and amortization$(406,617)$(405,326)$(85,862)$(7,574)$(67,842)$(6,077)$(24,787)$(4,671)$— $(1,008,756)
General and administrative(19,025)
Management fee(160,544)
Performance participation allocation— 
Impairment of investments in real estate(12,343)
Net gain on dispositions of real estate100,441 
Interest income2,102 
Interest expense(539,276)
Loss on extinguishment of debt(6,495)
Other income (expense)(15,080)
Net loss$(776,349)
Net loss attributable to non-controlling interests in third party joint ventures$1,796 
Net loss attributable to non-controlling interests in BREIT OP10,177 
Net loss attributable to BREIT stockholders$(764,376)
(1) Previously included within the Industrial segment.
16. Commitments and Contingencies
Litigation  
From time to time, the Company may be involved in various claims and legal actions arising in the ordinary course of business. As of September 30, 2021 and December 31, 2020, the Company was not involved in any material legal proceedings.
17. Subsequent Events
Acquisitions
Subsequent to September 30, 2021, the Company acquired an aggregate of $3.9 billion of real estate, exclusive of closing costs, across eleven separate transactions.
Subsequent to September 30, 2021, the Company acquired an aggregate of $0.8 billion of investments in unconsolidated entities.
Subsequent to September 30, 2021, the Company purchased an aggregate of $1.7 billion of investments in real estate debt.  
Proceeds from the Issuance of Common Stock
Subsequent to September 30, 2021, the Company received net proceeds of $4.7 billion from the issuance of its common stock. 

35


ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
References herein to “Blackstone Real Estate Income Trust,” “BREIT,” the “Company,” “we,” “us,” or “our” refer to Blackstone Real Estate Income Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.
The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto appearing elsewhere in this quarterly report on Form 10-Q.
Forward-Looking Statements
This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” “identified” or other similar words or the negatives thereof. These may include our financial projections and estimates and their underlying assumptions, statements about plans, objectives and expectations with respect to future operations, statements with respect to acquisitions, statements regarding future performance and statements regarding identified but not yet closed acquisitions. Such forward-looking statements are inherently uncertain and there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in such statements. We believe these factors also include but are not limited to those described under the section entitled “Risk Factors” in our prospectus and our Annual Report on form 10-K for the year ended December 31, 2020, and any such updated factors included in our periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this document (or our prospectus and other filings). Except as otherwise required by federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.
Overview
BREIT invests primarily in stabilized income-generating commercial real estate in the United States and, to a lesser extent, in real estate debt. We are the sole general partner and majority limited partner of BREIT Operating Partnership L.P. (“BREIT OP”), a Delaware limited partnership, and we own substantially all of our assets through BREIT OP. We are externally managed by BX REIT Advisors L.L.C. (the “Adviser”). The Adviser is part of the real estate group of Blackstone Inc. (“Blackstone”), a leading investment manager. We currently operate our business in nine reportable segments: Residential, Industrial, Net Lease, Data Centers, Hospitality, Self Storage, Retail, and Office Properties, and Investments in Real Estate Debt. Residential includes multifamily and other types of rental housing such as manufactured housing, student housing, and single family rental housing, as well as senior living. Net Lease includes the real estate assets of The Bellagio Las Vegas (the “Bellagio”) and the Company's unconsolidated interest in the MGM Grand and Mandalay Bay joint venture. Additional unconsolidated interests are included in the respective property segment.
BREIT is a non-listed, perpetual life real estate investment trust (“REIT”) that qualifies as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”) for U.S. federal income tax. We generally will not be subject to U.S. federal income taxes on our taxable income to the extent we annually distribute all of our net taxable income to stockholders and maintain our qualification as a REIT.
As of November 12, 2021, we have received net proceeds of $42.1 billion from the sale of shares of our common stock. We have contributed the net proceeds to BREIT OP in exchange for a corresponding number of Class S, Class I, Class T, and Class D units. BREIT OP has primarily used the net proceeds to make investments in real estate and real estate debt as further described below under “ Investment Portfolio.” We intend to continue selling shares on a monthly basis.
Recent Developments
As of September 30, 2021, the novel coronavirus (“COVID-19”) pandemic is ongoing. The COVID-19 pandemic has significantly impacted the global economy since the beginning of 2020 and has, among other things, created ongoing disruption in global supply chains, impacted the job market and adversely impacted many industries. During the nine months ended September 30, 2021, the global economy has, with certain setbacks, begun reopening and wider distribution of vaccines and easing of travel and other restrictions appear to be encouraging greater economic activity. Nonetheless, the recovery could remain uneven, particularly given uncertainty with respect to the distribution and acceptance of the vaccines and their effectiveness with respect to new variants of the virus, and the resolution of supply chain issues and other longer lasting impacts of the pandemic. As a result, we are still unable to predict when normal economic activity and business operations will fully resume.
36


The outbreak of COVID-19 and its impact on the current financial, economic and capital markets environment, and future developments in these and other areas present uncertainty and risk with respect to our financial condition, results of operations, liquidity, and ability to pay distributions. Countries around the world continue to grapple with the economic impacts of the COVID-19 pandemic and its aftereffects. Although a recovery is underway, it continues to be gradual, uneven and characterized by meaningful dispersion across sectors and regions, and could be hindered by persistent or resurgent infection rates and by related travel and other restrictions. The ongoing impact of fiscal stimulus from the U.S. government and continued accommodating monetary policy could provide meaningful support for a continued economic recovery, along with wider distribution of vaccines. Issues with respect to the distribution and acceptance of vaccines or the spread of new variants of the virus could adversely impact the recovery. Overall, there remains significant uncertainty regarding the timing and duration of the economic recovery, which precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. For additional discussion with respect to the potential impact of the COVID-19 pandemic on our liquidity and capital resources, see “Liquidity and Capital Resources” below.
Please refer to Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2020 and our prospectus dated February 12, 2021 and filed with the SEC, as supplemented, for additional disclosure relating to material trends or uncertainties that may impact our business.
37


Q3 2021 Highlights
Operating Results:
Declared monthly net distributions totaling $438.4 million for the three months ended September 30, 2021. The details of the average annualized distribution rates and total returns are shown in the following table:
Class SClass IClass TClass D
Average Annualized Distribution Rate(1)
4.2%5.1%4.3%4.9%
Year-to-Date Total Return, without upfront selling commissions(2)
20.5%21.5%20.9%20.6%
Year-to-Date Total Return, assuming maximum upfront selling commissions(2)
16.4%N/A16.8%18.8%
Inception-to-Date Total Return, without upfront selling commissions(2)
11.5%12.5%12.1%12.6%
Inception-to-Date Total Return, assuming maximum upfront selling commissions(2)
10.7%N/A11.2%12.2%
Investments:
Acquired 50 residential, 11 industrial, two self storage, and one retail property across 17 transactions with a total purchase price of $5.3 billion during the three months ended September 30, 2021. The acquisitions are consistent with our strategy of acquiring diversified, income-producing, commercial real estate assets concentrated in high growth markets.
Additionally, in July, acquired Home Partners of America (“HPA”), valuing the Company at $5.9 billion. HPA is one of the largest private owners and operators of single‐family rental (“SFR”) homes in the United States with a high-quality portfolio of over 17,000 homes across the country.
Invested $1.4 billion alongside Blackstone Infrastructure Partners and other long-term perpetual capital vehicles managed by Blackstone in the acquisition of all outstanding shares of common stock of QTS Realty Trust (NYSE: QTS) (“QTS”). QTS is a leading provider of data center solutions with a $10.0 billion portfolio of high-quality assets in top tier data center markets.
Invested $1.9 billion in real estate debt, consisting of commercial mortgage-backed securities (“CMBS”), residential mortgage-backed securities (“RMBS”), corporate bonds, term loans, and other investments in debt issued by real estate-related companies during the three months ended September 30, 2021.
Capital Activity and Financings:
Raised $7.5 billion of proceeds during the three months ended September 30, 2021 from the sale of our common stock. Repurchased $206.2 million of our common stock during the three months ended September 30, 2021.
Increased property-level financings by $5.3 billion and increased the financings secured by our investments in real estate debt by $2.4 billion during the three months ended September 30, 2021.
Overall Portfolio:
Our portfolio as of September 30, 2021 consisted of investments in real estate (90% based on fair value) and investments in real estate debt (10%).
Our 1,599 properties(3) as of September 30, 2021 consisted primarily of Residential (50% based on fair value), Industrial (28%), and Net Lease assets (9%), and our portfolio of real estate was concentrated in the following regions: South (38%), West (35%), East (15%), and Midwest (10%).
Our investments in real estate debt as of September 30, 2021 consisted of a diversified portfolio of CMBS, RMBS, and other real estate-related debt. For further details on credit rating and underlying real estate collateral, refer to “Investment Portfolio – Investments in Real Estate Debt”.
(1)The annualized distribution rate is calculated as the current month’s distribution annualized and divided by the prior month’s net asset value, which is inclusive of all fees and expenses. The Company believes the annualized distribution rate is a useful measure of the overall investment performance of our shares.
(2)Total return is calculated as the change in NAV per share during the respective periods plus any distributions per share declared in the period and assumes any distributions are reinvested in accordance with our distribution reinvestment plan. Total return for periods greater than one year are annualized. The Company believes total return is a useful measure of the overall investment performance of our shares.
(3)Excludes 20,940 single family rental homes. Such single family rental homes are included in the fair value amounts.
38


Investment Portfolio
Portfolio Summary
The following chart allocates our investments in real estate and real estate debt based on fair value as of September 30, 2021:
chart-6f93cc3ff817407dafca.jpg
 Real Estate Investments
The following charts further describe the diversification of our investments in real estate based on fair value as of September 30, 2021:
chart-aaaba07e609b4bfca68a.jpg
chart-b69eee450c0446a5945a.jpg
(1) Investments in real estate includes our direct property investments, unconsolidated investments, and equity in public and private real estate-related companies. Geographic weighting is measured as the asset value of real estate properties, excluding the value of any third-party interests in such real estate properties, and unconsolidated investments for each geographical category against the total asset value of (i) all real estate properties, excluding the value of any third-party interests in such real estate properties, and (ii) unconsolidated investments.
39



The following map identifies the top markets of our real estate portfolio composition based on fair value as of September 30, 2021:
breit_marketsxmapxv162a.jpg
The select markets that are named represent all metropolitan statistical areas (“MSAs”) in the U.S. in which BREIT has at least a 2% portfolio concentration. BREIT is invested in additional MSAs that are not named above. Shading reflects the concentration of all real estate properties and unconsolidated investments in each state. Other Markets includes 2% of BREIT's portfolio invested in non-U.S. assets, including in Europe and Canada. Weighting is measured as the asset value of real estate properties and unconsolidated investments for each market against the total asset value of all (i) real estate properties, excluding the value of any third-party interests in such real estate properties, and (ii) unconsolidated investments.
As of September 30, 2021, we owned 1,599 properties and 20,940 single family rental homes consisting of a diversified portfolio of income producing assets primarily focused in Residential, Industrial, and Net Lease properties, and to a lesser extent Data Centers, Hospitality, Self Storage, Retail, and Office properties, concentrated in growth markets.
40


The following table provides a summary of our portfolio as of September 30, 2021:
Segment
Number of
Properties(1)
Sq. Feet (in
thousands)/
Units/Keys
Occupancy
Rate(2)
Average Effective
Annual Base Rent
Per Leased Square
Foot/Units/Keys(3)
Gross Asset
Value(4)
($ in thousands)
Segment
Revenue(5)
Percentage of Total Revenues
Residential(6)
344132,528 units93%$15,459$29,343,264 $1,067,417 39%
Industrial966162,156 sq. ft.96%$5.1017,016,624 828,377 31%
Net lease324,748 sq. ft.N/AN/A5,771,056 323,780 12%
Data Centers5910,204 sq. ft.100%$13.492,656,811 3,529 <1%
Hospitality589,672 keys56% $133.66/$74.952,158,322 295,936 11%
Self Storage15211,122 sq. ft.93%$13.021,802,752 107,937 4%
Retail142,314 sq. ft.97%$22.92831,086 46,170 2%
Office3946 sq. ft.99%$35.76691,247 32,956 1%
Total1,599$60,271,162 $2,706,102 100%
 
(1)Residential, Industrial, Net Lease, and Data Centers, include properties owned by unconsolidated entities. Single family rental homes are accounted for in residential units and are not reflected in the number of properties.
(2)For our industrial, data center, retail and office investments, occupancy includes all leased square footage as of September 30, 2021. For our multifamily and student housing investments, occupancy is defined as the percentage of actual rent divided by gross potential rent (defined as actual rent for occupied units and market rent for vacant units) for the three months ended September 30, 2021. For our single family rental investments, the occupancy rate includes occupied homes for the three months ended September 30, 2021. For our self storage, manufactured housing and senior living investments, the occupancy rate includes occupied square footage, occupied sites and occupied units, respectively, as of September 30, 2021. The occupancy rate for our hospitality investments includes paid occupied rooms for the 12 months ended September 30, 2021. Hospitality investments owned less than 12 months are excluded from the average occupancy rate calculation.
(3)For industrial, data centers, manufactured housing, self storage, retail, and office properties, average effective annual base rent represents the annualized September 30, 2021 base rent per leased square foot or unit and excludes tenant recoveries, straight-line rent and above-market and below-market lease amortization. For multifamily and residential properties other than manufactured housing, average effective annual base rent represents the base rent for the three months ended September 30, 2021 per leased unit, and excludes tenant recoveries, straight-line rent and above-market and below-market lease amortization. For hospitality properties, average effective annual base rent represents Average Daily Rate (“ADR”) and Revenue Per Available Room (“RevPAR”), respectively, for the 12 months ended September 30, 2021. Hospitality investments owned less than 12 months are excluded from the ADR and RevPAR calculations.  
(4)Based on fair value as of September 30, 2021.
(5)Segment revenue is presented for the nine months ended September 30, 2021. Net lease, industrial, data centers, and residential segment revenue includes income from unconsolidated entities.
(6)Residential includes includes multifamily and other types of rental housing such as manufactured housing, student housing, and single family rental housing, as well as senior living. Residential units include manufactured housing sites, student housing beds, single family rental homes and senior living units.
41


Real Estate
The following table provides information regarding our real estate portfolio as of September 30, 2021:
Segment and Investment
Number of
Properties(1)
LocationAcquisition Date
Ownership Interest(2)
Sq. Feet (in thousands)/Units/Keys(1)
Occupancy Rate(3)
Residential:
TA Multifamily Portfolio6VariousApril 2017100%2,514 units93%
Emory Point1Atlanta, GAMay 2017100%750 units96%
Nevada West Multifamily3Las Vegas, NVMay 2017100%972 units95%
Mountain Gate & Trails Multifamily2Las Vegas, NVJune 2017100%539 units95%
Elysian West Multifamily1Las Vegas, NVJuly 2017100%466 units96%
Gilbert Multifamily2Gilbert, AZSept. 201790%748 units96%
Domain & GreenVue Multifamily2Dallas, TXSept. 2017100%803 units97%
ACG II Multifamily4VariousSept. 201794%932 units95%
Olympus Multifamily3Jacksonville, FLNov. 201795%1,032 units94%
Amberglen West Multifamily1Hillsboro, ORNov. 2017100%396 units95%
Aston Multifamily Portfolio18VariousVarious100%3,991 units95%
Talavera and Flamingo Multifamily2Las Vegas, NVDec. 2017100%674 units96%
Walden Pond & Montair Multifamily Portfolio2Everett, WA & Thornton, CODec. 201795%636 units97%
Signature at Kendall Multifamily1Miami, FLDec. 2017100%546 units95%
The Boulevard1Phoenix, AZApril 2018100%294 units95%
Blue Hills Multifamily1Boston, MAMay 2018100%472 units93%
Wave Multifamily Portfolio6VariousMay 2018100%2,199 units97%
ACG III Multifamily2Gresham, OR & Turlock, CAMay 201895%475 units97%
Carroll Florida Multifamily2Jacksonville & Orlando, FLMay 2018100%716 units94%
Solis at Flamingo1Las Vegas, NVJune 201895%524 units98%
Velaire at Aspera1Phoenix, AZJuly 2018100%286 units95%
Coyote Multifamily Portfolio6Phoenix, AZAug. 2018100%1,752 units96%
Avanti Apartments1Las Vegas, NVDec. 2018100%414 units95%
Gilbert Heritage Apartments1Phoenix, AZFeb. 201990%256 units97%
Roman Multifamily Portfolio14VariousFeb. 2019100%3,743 units96%
Elevation Plaza Del Rio1Phoenix, AZApril 201990%333 units97%
Courtney at Universal Multifamily1Orlando, FLApril 2019100%355 units93%
Citymark Multifamily 2-Pack2Las Vegas, NV & Lithia Springs, GAApril 201995%608 units95%
Tri-Cities Multifamily 2-Pack2Richland & Kennewick, WAApril 201995%428 units97%
Raider Multifamily Portfolio4Las Vegas, NVVarious100%1,514 units96%
Bridge II Multifamily Portfolio6VariousVarious100%2,363 units94%
Miami Doral 2-Pack2Miami, FLMay 2019100%720 units94%
Davis Multifamily 2-Pack2Raleigh, NC & Jacksonville, FLMay 2019100%454 units95%
Slate Savannah1Savannah, GAMay 201990%272 units96%
Amara at MetroWest1Orlando, FLMay 201995%411 units94%
Colorado 3-Pack3Denver & Fort Collins, COMay 2019100%855 units93%
Edge Las Vegas1Las Vegas, NVJune 201995%296 units96%
ACG IV Multifamily2Woodland, CA & Puyallup, WAJune 201995%606 units96%
Perimeter Multifamily 3-Pack3Atlanta, GAJune 2019100%691 units95%
Anson at the Lakes1Charlotte, NCJune 2019100%694 units95%
San Valiente Multifamily1Phoenix, AZJuly 201995%604 units97%
Edgewater at the Cove1Oregon City, ORAug. 2019100%244 units93%
Haven 124 Multifamily1Denver, COSept. 2019100%562 units92%
Villages at McCullers Walk Multifamily1Raleigh, NCOct. 2019100%412 units95%
Canopy at Citrus Park Multifamily1Largo, FLOct. 201990%318 units94%
Ridge Multifamily Portfolio4Las Vegas, NVOct. 201990%1,220 units94%
Charleston on 66th Multifamily1Tampa, FLNov. 201995%258 units94%
Evolve at Timber Creek Multifamily1Garner, NCNov. 2019100%304 units97%
Solis at Towne Center Multifamily1Glendale, AZNov. 2019100%240 units97%
Arches at Hidden Creek Multifamily1Chandler, AZNov. 201998%432 units93%
Terra Multifamily1Austin, TXDec. 2019100%372 units95%
Arium Multifamily Portfolio5VariousDec. 2019100%1,684 units93%
Easton Gardens Multifamily1Columbus, OHFeb. 202095%1,064 units94%
Acorn Multifamily Portfolio21VariousFeb. & May 202098%8,309 units95%
Indigo West Multifamily1Orlando, FLMarch 2020100%456 units92%
The Sixes Multifamily1Holly Springs, GASept. 2020100%340 units98%
42


Segment and Investment
Number of
Properties(1)
LocationAcquisition Date
Ownership Interest(2)
Sq. Feet (in thousands)/Units/Keys(1)
Occupancy Rate(3)
Park & Market Multifamily1Raleigh, NCOct. 2020100%409 units95%
Cortland Lex Multifamily1Alpharetta, GAOct. 2020100%360 units98%
The Palmer Multifamily1Charlotte, NCOct. 202090%318 units95%
Grizzly Multifamily Portfolio2Atlanta, GA & Nashville, TNOct. & Nov. 2020100%767 units93%
Jaguar Multifamily Portfolio11VariousNov. & Dec. 2020100%3,788 units94%
Kansas City Multifamily Portfolio2Overland Park & Olathe, KSDec. 2020100%620 units93%
The View at Woodstock Multifamily1Woodstock, GAJan. 2021100%320 units97%
Southeast Multifamily Portfolio2Lebanon, TN & Sanford, FLFeb. 202198%330 units93%
Cortona South Tampa Multifamily1Tampa, FLApril 2021100%300 units95%
Crest at Park Central Multifamily1Dallas, TXApril 2021100%387 units97%
Archer & Rosery Multifamily Portfolio2Acworth, GA & Largo, FLApril & May 2021100%539 units91%
Encore Tessera Multifamily1Phoenix, ArizonaMay 202180%240 units94%
Acorn 2.0 Multifamily Portfolio17VariousVarious98%6,689 units84%
Vue at Centennial Multifamily1Las Vegas, NVJune 2021100%372 units96%
Charlotte Multifamily Portfolio3VariousJune & Aug. 2021100%876 units84%
Haven by Watermark Multifamily1Denver, COJune 2021100%206 units98%
Home Partners of America(4)
N/A(1)
VariousJuly 2021
Various(4)
20,940 units98%
Quebec Independent Living Portfolio10Quebec, CanadaAug. 202195%2,877 units80%
Legacy North Multifamily1Plano, TXAug. 2021100%1,675 units97%
The Brooke Multifamily1Atlanta, GAAug. 2021100%537 units93%
One Boynton Multifamily1Boynton Beach, FLAug. 2021100%494 units96%
Falcon Landing Multifamily1Katy, TXAug. 202190%386 units92%
Town Lantana Multifamily1Lantana, FLSept. 202190%360 units96%
Ring Multifamily Portfolio12VariousSept. 2021100%3,030 units95%
Highroads MH3Phoenix, AZApril 201899%265 units96%
Evergreen Minari MH2Phoenix, AZJune 201899%115 units96%
Southwest MH12VariousJune 201899%2,568 units89%
Hidden Springs MH1Desert Hot Springs, CAJuly 201899%317 units98%
SVPAC MH2Phoenix, AZJuly 201899%233 units98%
Riverest MH1Tavares, FLDec. 201899%130 units93%
Angler MH Portfolio4Phoenix, AZApril 201999%770 units92%
Florida MH 4-Pack4VariousApril & July 201999%799 units90%
Impala MH3Phoenix & Chandler, AZJuly 201999%333 units98%
Clearwater MHC 2-Pack2Clearwater, FLMarch & Aug. 202099%207 units98%
Legacy MH Portfolio7VariousApril 202099%1,896 units92%
May Manor MH1Lakeland, FLJune 202099%297 units82%
Royal Oaks MH1Petaluma, CANov. 202099%94 units99%
Southeast MH Portfolio37VariousDec. 202099%7,814 units86%
Redwood Village MH1Santa Rosa, CAJuly 202199%67 units100%
EdR Student Housing Portfolio20VariousSept. 201895%10,610 units94%
Mercury 3100 Student Housing1Orlando, FLFeb. 2021100%228 units98%
Signal Student Housing Portfolio8VariousAug. 202196%5,416 units92%
Total Residential344132,528 units
Industrial:
Stockton Industrial Park1Stockton, CAFeb. 2017100%878 sq. ft.100%
HS Industrial Portfolio36VariousApril 2017100%5,838 sq. ft.100%
Fairfield Industrial Portfolio11Fairfield, NJSept. 2017100%578 sq. ft.99%
Southeast Industrial Portfolio5VariousNov. 2017100%1,927 sq. ft.100%
Kraft Chicago Industrial Portfolio3Aurora, ILJan. 2018100%1,693 sq. ft.100%
Canyon Industrial Portfolio145VariousMarch 2018100%20,954 sq. ft.97%
HP Cold Storage Industrial Portfolio6VariousMay 2018100%2,259 sq. ft.100%
Meridian Industrial Portfolio106VariousNov. 201899%14,014 sq. ft.96%
Stockton Distribution Center1Stockton, CADec. 2018100%987 sq. ft.100%
Summit Industrial Portfolio8Atlanta, GADec. 2018100%631 sq. ft.93%
4500 Westport Drive1Harrisburg, PAJan. 2019100%179 sq. ft.100%
Morgan Savannah1Savannah, GAApril 2019100%357 sq. ft.100%
Minneapolis Industrial Portfolio34Minneapolis, MNApril 2019100%2,459 sq. ft.98%
Atlanta Industrial Portfolio61Atlanta, GAMay 2019100%3,779 sq. ft.91%
Patriot Park Industrial Portfolio2Durham, NCSept. 2019100%323 sq. ft.100%
Denali Industrial Portfolio18VariousSept. 2019100%4,098 sq. ft.97%
43


Segment and Investment
Number of
Properties(1)
LocationAcquisition Date
Ownership Interest(2)
Sq. Feet (in thousands)/Units/Keys(1)
Occupancy Rate(3)
Jupiter 12 Industrial Portfolio315VariousSept. 2019100%63,979 sq. ft.96%
2201 Main Street1San Diego, CAOct. 2019100%260 sq. ft.N/A
Triangle Industrial Portfolio37Greensboro, NCJan. 2020100%2,783 sq. ft.95%
Midwest Industrial Portfolio27VariousFeb. 2020100%5,940 sq. ft.97%
Pancal Industrial Portfolio12VariousFeb. & April 2020100%2,109 sq. ft.99%
Grainger Distribution Center1Jacksonville, FLMarch 2020100%297 sq. ft.100%
Diamond Industrial1Rico Rivera, CAAug. 2020100%243 sq. ft.100%
Inland Empire Industrial Portfolio2Etiwanda & Fontana, CASept. 2020100%404 sq. ft.100%
Shield Industrial Portfolio13VariousDec. 2020100%2,079 sq. ft.100%
7520 Georgetown Industrial1Indianapolis, INDec. 2020100%425 sq. ft.100%
WC Infill Industrial Portfolio(5)
19VariousJan. & Aug. 202185%2,926 sq. ft.99%
Vault Industrial Portfolio(5)
35VariousJan. 202141%6,586 sq. ft.99%
Chicago Infill Industrial Portfolio7VariousFeb. 2021100%1,058 sq. ft.100%
Greensboro Industrial Portfolio19VariousApril 2021100%2,068 sq. ft.96%
NW Corporate Center3El Paso, TXJuly 2021100%692 sq. ft.100%
I-85 Southeast Industrial Portfolio4VariousJuly & Aug. 2021100%739 sq. ft.100%
Alaska Industrial Portfolio(5)
26Various UKJuly 202126.7%8,057 sq. ft.100%
Stephanie Industrial Portfolio2Henderson, NVSept. 2021100%338 sq. ft.23%
Capstone Industrial Portfolio2Brooklyn Park, MNSept. 2021100%219 sq. ft.86%
Total Industrial966162,156 sq. ft.
Net Lease:
Bellagio Net Lease1Las Vegas, NVNov. 201995%8,507 sq. ft.N/A
MGM Grand Net Lease(5)
1Las Vegas, NVFeb. 202049.9%6,917 sq. ft.N/A
Mandalay Bay Net Lease(5)
1Las Vegas, NVFeb. 202049.9%9,324 sq. ft.N/A
Total Net Lease324,748 sq. ft.
Data Centers:
D.C. Powered Shell Warehouse Portfolio9Ashburn & Manassas, VAJune & Dec. 201990%1,471 sq. ft.100%
Highpoint Powered Shell Portfolio2Sterling, VAJune 2021100%430 sq. ft.100%
QTS Data Centers(5)
48VariousAug. 202150.1%8,303 sq. ft.92%
Total Data Centers5910,204 sq. ft.
Hospitality:
Hyatt Place UC Davis1Davis, CAJan. 2017100%127 keys52%
Hyatt Place San Jose Downtown1San Jose, CAJune 2017100%240 keys36%
Florida Select-Service 4-Pack4Tampa & Orlando, FLJuly 2017100%476 keys67%
Hyatt House Downtown Atlanta1Atlanta, GAAug. 2017100%150 keys58%
Boston/Worcester Select-Service 3-Pack3Boston & Worcester, MAOct. 2017100%374 keys58%
Henderson Select-Service 2-Pack2Henderson, NVMay 2018100%228 keys75%
Orlando Select-Service 2-Pack2Orlando, FLMay 2018100%254 keys72%
Corporex Select Service Portfolio5VariousAug. 2018100%601 keys65%
JW Marriott San Antonio Hill Country Resort1San Antonio, TXAug. 2018100%1,002 keys41%
Hampton Inn & Suites Federal Way1Seattle, WAOct. 2018100%142 keys54%
Staybridge Suites Reno1Reno, NVNov. 2018100%94 keys81%
Salt Lake City Select Service 3 Pack3Salt Lake City, UTNov. 201860%454 keys69%
Courtyard Kona1Kailua-Kona, HIMarch 2019100%455 keys53%
Raven Select Service Portfolio21VariousJune 2019100%2,555 keys61%
Urban 2-Pack1Chicago, ILJuly 2019100%337 keys29%
Hyatt Regency Atlanta1Atlanta, GASept. 2019100%1,260 keys40%
RHW Select Service Portfolio9VariousNov. 2019100%923 keys69%
Total Hospitality589,672 keys
Self Storage:
East Coast Storage Portfolio21VariousAug. 201998%1,451 sq. ft.94%
Phoenix Storage 2-Pack2Phoenix, AZMarch 202098%111 sq. ft.96%
Cactus Storage Portfolio18VariousSept. & Oct. 202098%1,114 sq. ft.92%
Caltex Storage Portfolio4VariousNov. & Dec. 202098%241 sq. ft.95%
Simply Self Storage102VariousDec. 2020100%7,843 sq. ft.93%
Florida Self Storage Portfolio2Cocoa & Rockledge, FLDec. 202098%159 sq. ft.97%
Pace Storage Portfolio1Pace, FLDec. 202098%72 sq. ft.94%
44


Segment and Investment
Number of
Properties(1)
LocationAcquisition Date
Ownership Interest(2)
Sq. Feet (in thousands)/Units/Keys(1)
Occupancy Rate(3)
American Harbor1Dallas, TXAug. 2021100%66 sq. ft.96%
Flamingo Self Storage Portfolio1Corpus Christi, TXSept. 202198%65 sq. ft.93%
Total Self Storage15211,122 sq. ft.
Retail:
Bakers Centre1Philadelphia, PAMarch 2017100%236 sq. ft.100%
Plaza Del Sol Retail1Burbank, CAOct. 2017100%166 sq. ft.99%
Vista Center1Miami, FLAug. 2018100%89 sq. ft.95%
El Paseo Simi Valley1Simi Valley, CAJune 2019100%197 sq. ft.90%
Towne Center East1Signal Hill, CASept. 2019100%163 sq. ft.99%
Plaza Pacoima1Pacoima, CAOct. 2019100%204 sq. ft.100%
Canarsie Plaza1Brooklyn, NYDec. 2019100%274 sq. ft.99%
SoCal Grocery Portfolio6VariousJan. 2020100%689 sq. ft.94%
Northeast Tower Center1Philadelphia, PAAug. 2021100%296 sq. ft.100%
Total Retail142,314 sq. ft.
Office:
EmeryTech Office1Emeryville, CAOct. 2019100%228 sq. ft.95%
Coleman Highline Office1San Jose, CAOct. 2020100%357 sq. ft.100%
Atlanta Tech Center Office1Atlanta, GAMay 202198%361 sq. ft.100%
Total Office3946 sq. ft.
Total Investments in Real Estate1,599
(1)Residential includes multifamily and other types of rental housing such as manufactured housing, student housing, and single family rental housing, as well as senior living. Residential units include multifamily units, manufactured housing sites, student housing beds, single family rental homes and senior living units. Single family rental homes are accounted for in residential units and are not reflected in the number of properties.
(2)Certain of our joint venture agreements provide the seller or the other partner a profits interest based on achieving certain internal rate of return hurdles. Such investments are consolidated by us and any profits interest due to the other partners is reported within non-controlling interests. The table above also includes properties owned by unconsolidated entities.
(3)For our industrial, data center, retail and office investments, occupancy includes all leased square footage as of September 30, 2021. For our multifamily and student housing investments, occupancy is defined as the percentage of actual rent divided by gross potential rent (defined as actual rent for occupied units and market rent for vacant units) for the three months ended September 30, 2021. For our single family rental investments, the occupancy rate includes occupied homes for the three months ended September 30, 2021. For our self storage, manufactured housing and senior living investments, the occupancy rate includes occupied square footage, occupied sites and occupied units, respectively, as of September 30, 2021. The occupancy rate for our hospitality investments includes paid occupied rooms for the 12 months ended September 30, 2021. Hospitality investments owned less than 12 months are excluded.
(4)Includes a 100% interest in 11,414 consolidated single family rental properties, a 27.8% interest in 9,078 unconsolidated single family rental properties, and a 12.2% interest in 448 unconsolidated single family rental properties.
(5)Investment is unconsolidated.
45


Lease Expirations
The following schedule details the expiring leases at our consolidated industrial, net lease, data centers, retail, and office properties by annualized base rent and square footage as of September 30, 2021 ($ and square feet data in thousands). The table below excludes our residential and self-storage properties as substantially all leases at such properties expire within 12 months:
YearNumber of
Expiring Leases
Annualized
Base Rent(1)
% of Total
Annualized Base
Rent Expiring
Square
Feet
% of Total Square
Feet Expiring
2021 (remaining)97$12,570 1%2,413 2%
2022540107,432 10%20,095 14%
2023485124,062 12%24,141 16%
2024516110,664 11%20,607 14%
202533779,688 7%14,056 10%
2026378121,343 12%24,342 16%
202715863,918 6%11,834 8%
202811243,763 4%6,998 5%
20296839,456 4%4,802 3%
20306558,400 5%6,457 4%
20313412,688 1%1,638 1%
Thereafter60293,536 27%10,424 7%
Total2,850$1,067,520 100%147,807 100%
(1)Annualized base rent is determined from the annualized September 30, 2021 base rent per leased square foot of the applicable year and excludes tenant recoveries, straight-line rent, and above-market and below-market lease amortization.
Investments in Real Estate Debt
The following charts further describe the diversification of our investments in real estate debt by credit rating and collateral type based on fair value as of September 30, 2021:
chart-45a3742b0a8b44fa96ca.jpgchart-a53ee0f33b5e45de992a.jpg
46


The following table details our investments in real estate debt as of September 30, 2021 ($ in thousands):
 September 30, 2021
Type of Security/Loan
Weighted
Average
Coupon(1)
Weighted
Average
Maturity Date(2)
Face
Amount
Cost
Basis
Fair
Value
CMBS(3)
L+2.7%6/2/2026$5,031,213 $4,939,962 $4,957,915 
Corporate bonds4.8%12/26/2027166,242 166,242 168,594 
RMBS3.8%2/13/2051103,008 102,959 103,078 
Total real estate securities3.6%12/15/20265,300,463 5,209,163 5,229,587 
Commercial real estate loansL+3.9%2/12/20251,480,951 1,463,893 1,467,521 
Other investments(4)
3.7%7/25/2029235,956 205,887 205,887 
Total investments in real estate debtL+2.7%8/23/2026$7,017,370 $6,878,943 $6,902,995 
 
(1)The term “L” refers to the relevant floating benchmark rates, which include USD LIBOR, GBP LIBOR, EURIBOR, SOFR and SONIA, as applicable to each security and loan. Fixed rate CMBS and Commercial real estate loans are reflected as a spread over the relevant floating benchmark rates, as of September 30, 2021 and December 31, 2020, respectively, for purposes of the weighted-averages. Weighted Average Coupon for CMBS does not include zero coupon securities. As of September 30, 2021, we have interest rate swaps outstanding with a notional value of $1.1 billion that effectively converts a portion of our fixed rate investments in real estate debt to floating rates.
(2)Weighted average maturity date is based on the fully extended maturity date of the instrument or, in the case of CMBS and RMBS, the underlying collateral.
(3)Face amount excludes interest-only securities with a notional amount of $3.4 billion and $2.3 billion as of September 30, 2021 and December 31, 2020, respectively. In addition, CMBS includes zero coupon securities of $208.8 million and $236.1 million as of September 30, 2021 and December 31, 2020, respectively.
(4)Includes an interest in an unconsolidated joint venture that holds investments in real estate securities.
47


Results of Operations
The following table sets forth information regarding our consolidated results of operations ($ in thousands, except per share data):
 Three Months EndedChange
 September 30, 2021June 30, 2021$
Revenues  
Rental revenue$808,098 $680,809 $127,289 
Hospitality revenue127,507 102,660 24,847 
Other revenue43,704 26,714 16,990 
Total revenues979,309 810,183 169,126 
Expenses
Rental property operating314,017 247,985 66,032 
Hospitality operating92,280 75,093 17,187 
General and administrative7,106 7,789 (683)
Management fee122,866 92,183 30,683 
Performance participation allocation449,822 299,373 150,449 
Depreciation and amortization482,045 399,621 82,424 
Total expenses1,468,136 1,122,044 346,092 
Other income (expense)
Income from unconsolidated entities78,445 70,028 8,417 
Income from investments in real estate debt83,052 116,573 (33,521)
Net (loss) gain on dispositions of real estate(9,586)7,372 (16,958)
Interest income41 32 
Interest expense(204,538)(181,529)(23,009)
Loss on extinguishment of debt(3,372)(2,757)(615)
Other income (expense)177,631 125,583 52,048 
Total other income (expense)121,673 135,279 (13,606)
Net loss$(367,154)$(176,582)$(190,572)
Net loss (income) attributable to non-controlling interests in third party joint ventures$5,472 $(264)$5,736 
Net loss attributable to non-controlling interests in BREIT OP4,393 2,089 2,304 
Net loss attributable to BREIT stockholders$(357,289)$(174,757)$(182,532)
Net loss per share of common stock — basic and diluted$(0.12)$(0.08)$(0.04)
Rental Revenue
During the three months ended September 30, 2021, rental revenue increased $127.3 million as compared to the three months ended June 30, 2021. The increase can primarily be attributed to a $12.5 million increase in same property revenues and a $114.8 million increase in non-same property revenues. See Same Property Results of Operations section for further details of the increase in same property revenues. The non-same property revenue increase is due to the real estate acquisitions we made during the second and third quarter of 2021.
Hospitality Revenue
During the three months ended September 30, 2021, hospitality revenue increased $24.8 million as compared to the three months ended June 30, 2021. As the economy continues to reopen and travel restrictions ease from the COVID-19 pandemic, we have begun to see a recovery in our hospitality assets. ADR for the hotels in our same property portfolio increased from $140 to $159, while occupancy increased 5% and RevPAR increased from $91 to $112 during the three months ended September 30, 2021 compared to the three months ended June 30, 2021.
Other Revenue
During the three months ended September 30, 2021, other revenue increased $17.0 million as compared to the three months ended June 30, 2021. The increase can primarily be attributed to asset management, property management, and acquisition fee revenue earned as part of managing HPA's joint ventures during the three months ended September 30, 2021.
48


Rental Property Operating Expenses
During the three months ended September 30, 2021, rental property operating expenses increased $66.0 million as compared to the three months ended June 30, 2021. The increase can primarily be attributed to a $67.6 million increase in non-same property operating expenses, partially offset by a $1.6 million decrease in same property operating expenses. The non-same property operating expense increase is due to the real estate acquisitions we made during the second and third quarter of 2021. See Same Property Results of Operations section for further details of the decrease in same property operating expenses.
Hospitality Operating Expenses
During the three months ended September 30, 2021, hospitality operating expenses increased $17.2 million as compared to the three months ended June 30, 2021. The increase in hospitality operating expenses was primarily the result of increased occupancy and the resulting increased operating expenses at our hotels during the three months ended September 30, 2021.
Management Fee
During the three months ended September 30, 2021, the management fee increased $30.7 million compared to the three months ended June 30, 2021. The increase was primarily due to the $10.3 billion increase in our NAV from June 30, 2021 to September 30, 2021.
Performance Participation Allocation
During the three months ended September 30, 2021, the unrealized performance participation allocation accrual increased $150.4 million compared to the three months ended June 30, 2021. The increase was primarily the result of our increased NAV and a higher total return for the three months ended September 30, 2021 compared to the three months ended June 30, 2021.
Depreciation and Amortization
During the three months ended September 30, 2021, depreciation and amortization increased $82.4 million compared to the three months ended June 30, 2021. The increase is attributable to $86.4 million resulting from the increase in properties within our portfolio, partially offset by a decrease of $4.0 million due to the full amortization of certain intangible assets.
Income from Unconsolidated Entities
During the three months ended September 30, 2021, income from unconsolidated entities increased $8.4 million compared to the three months ended June 30, 2021. The increase is primarily due to an increase of $34.0 million in the fair value of our investments in the WC Infill Industrial Portfolio and Vault Industrial Portfolio from June 30, 2021 to September 30, 2021. This increase was partially offset by $21.3 million of losses on our investments in Home Partners of America and QTS Data Centers, primarily attributable to depreciation and amortization, as well as $4.3 million of realized losses on homes sales within our unconsolidated investment in Home Partners of America.
Income (Loss) from Investments in Real Estate Debt
During the three months ended September 30, 2021, income from our investments in real estate debt decreased $33.5 million compared to the three months ended June 30, 2021. The decrease was primarily attributable to $13.0 million of unrealized gains during the three months ended September 30, 2021 compared to $61.1 million of unrealized gains during the three months ended June 30, 2021. This decrease was partially offset by $11.3 million of realized gains during the three months ended September 30, 2021 compared to $6.9 million of realized gains during the three months ended June 30, 2021. Additionally, interest income increased $10.2 million during the three months ended September 30, 2021, compared to the three months ended June 30, 2021 due to an increase in our investments in real estate debt.
Net (Loss) Gain on Dispositions of Real Estate
During the three months ended September 30, 2021, net (loss) gain on dispositions of real estate decreased $17.0 million compared to the three months ended June 30, 2021. During the three months ended September 30, 2021, we recorded $9.6 million of net losses from the disposition of 115 residential properties, which included 111 single family rental homes, compared to $7.4 million of net gains from the disposition of one residential property during the three months ended June 30, 2021.
49


Interest Expense
During the three months ended September 30, 2021, interest expense increased $23.0 million compared to the three months ended June 30, 2021. The increase was primarily due to the increase in both our property-level debt and secured financings of investments in real estate debt.
Other Income (Expense)
During the three months ended September 30, 2021, other income (expense) increased $52.0 million compared to the three months ended June 30, 2021. The increase was primarily due to $154.8 million of unrealized gains on our investments in equity securities and $8.0 million of unrealized gains on our interest rate swaps during the three months ended September 30, 2021, compared to $142.5 million of unrealized gains on our investments in equity securities and $27.3 million of unrealized losses on our interest rate swaps during the three months ended June 30, 2021. Additionally, dividend income from our investments in equity securities increased $4.4 million during the three months ended September 30, 2021.
The following table sets forth information regarding our consolidated results of operations ($ in thousands):
 Nine months ended September 30,2021 vs. 2020
 20212020$
Revenues   
Rental revenue$2,141,823 $1,647,865 $493,958 
Hospitality revenue288,310 205,291 83,019 
Other revenue92,814 49,844 42,970 
Total revenues2,522,947 1,903,000 619,947 
Expenses
Rental property operating799,707 548,729 250,978 
Hospitality operating223,053 204,168 18,885 
General and administrative21,855 19,025 2,830 
Management fee288,144 160,544 127,600 
Performance participation allocation892,410 — 892,410 
Impairment of investments in real estate— 12,343 (12,343)
Depreciation and amortization1,282,053 1,008,756 273,297 
Total expenses3,507,222 1,953,565 1,553,657 
Other income (expense)
Income from unconsolidated entities183,155 63,678 119,477 
Income (loss) from investments in real estate debt438,986 (317,212)756,198 
Net gain on dispositions of real estate13,216 100,441 (87,225)
Interest income136 2,102 (1,966)
Interest expense(567,685)(539,276)(28,409)
Loss on extinguishment of debt(9,545)(6,495)(3,050)
Other income (expense)411,160 (29,022)440,182 
Total other income (expense)469,423 (725,784)1,195,207 
Net loss$(514,852)$(776,349)$261,497 
Net loss attributable to non-controlling interests in third party joint ventures$5,149 $1,796 $3,353 
Net loss attributable to non-controlling interests in BREIT OP6,129 10,177 (4,048)
Net loss attributable to BREIT stockholders$(503,574)$(764,376)$260,802 
Net loss per share of common stock — basic and diluted$(0.21)$(0.49)$0.28 
Revenues, Rental Property Operating and Hospitality Operating Expenses
Due to the significant amount of acquisitions of real estate and investments in real estate debt we have made since September 30, 2020, our revenues and operating expenses for the nine months ended September 30, 2021 and 2020 are not comparable. See below for a discussion of the properties in our portfolio that were owned for both of the full nine months ended September 30, 2021 and 2020.
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General and Administrative Expenses
During the nine months ended September 30, 2021, general and administrative expenses increased $2.8 million compared to the corresponding period in 2020. The increase was primarily due to various corporate level expenses related to the increased size of our portfolio.
Management Fee
During the nine months ended September 30, 2021, the management fee increased $127.6 million compared to the corresponding period in 2020. The increase was primarily due to the $22.9 billion increase in our NAV from September 30, 2020 to September 30, 2021.
Performance Participation Allocation
During the nine months ended September 30, 2021, the unrealized performance participation allocation accrual increased $892.4 million compared to the corresponding period in 2020. The increase was primarily the result of our increased NAV and a higher total return for the nine months ended September 30, 2021 compared to the corresponding period in 2020.
Depreciation and Amortization
During the nine months ended September 30, 2021, depreciation and amortization increased $273.3 million compared to the corresponding period in 2020. The increase was primarily driven by the impact of acquisition activity, partially offset by the impact of disposition activity as well as the full amortization of certain intangible assets.
Income from Unconsolidated Entities
During the nine months ended September 30, 2021, income from unconsolidated entities increased $119.5 million compared to the corresponding period in 2020. The increase is primarily attributable to $145.1 million of income from the acquisitions of WC Infill Industrial Portfolio, Vault Industrial Portfolio and Alaska UK Industrial Portfolio, as well as a full nine months of income from our investment in MGM Grand & Mandalay Bay. This increase was partially offset by $21.3 million of losses on our investments in Home Partners of America and QTS Data Centers, primarily attributable to depreciation and amortization, as well as $4.3 million of realized losses on homes sales within our unconsolidated investment in Home Partners of America.
Income (Loss) from Investments in Real Estate Debt
During the nine months ended September 30, 2021, income (loss) from our investments in real estate debt increased $756.2 million compared to the corresponding period in 2020. The increase was primarily attributable to $291.1 million of unrealized gains and $2.4 million of realized losses during the nine months ended September 30, 2021 compared to $443.5 million of unrealized losses and $21.1 million of realized losses during the corresponding period in 2020. Additionally, interest income increased $2.9 million during the nine months ended September 30, 2021, compared to the corresponding period in 2020 due to an increase in our investments in real estate debt. The COVID-19 pandemic caused significant market pricing and liquidity dislocation in March 2020, causing a broad-based market decline impacting the unrealized value of certain of our investments in real estate debt. However, we saw a recovery in the fair value of our investments in real estate debt beginning in the second quarter of 2020.
Net Gain (Loss) on Dispositions of Real Estate
During the nine months ended September 30, 2021, net gain (loss) on dispositions of real estate decreased $87.2 million compared to the corresponding period in 2020. During the nine months ended September 30, 2021, we recorded $13.2 million of net gains from the sale of 120 residential properties, which included 111 single family rental homes, compared to a $100.4 million net gain from the disposition of six residential, one hotel, and one industrial property during the corresponding period in 2020.
Interest Expense
During the nine months ended September 30, 2021, interest expense increased $28.4 million compared to the corresponding period in 2020. The increase was primarily due to the growth in our real estate portfolio and investments in real estate debt and the related indebtedness of such investments.
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Other Income (Expense)
During the nine months ended September 30, 2021, other income (expense) increased $440.2 million compared to the corresponding period in 2020. The increase was primarily due to $379.6 million of unrealized gains on our investments in equity securities, $35.4 million of dividend income from our investments in equity securities and $2.2 million of unrealized losses on our interest rate swaps during the nine months ended September 30, 2021, compared to $40.6 million of unrealized losses, $12.1 of realized gains on our investments in equity securities and $13.9 million of dividend income from our investments in equity securities during the corresponding period in 2020. Additionally during the nine months ended September 30, 2020, other income (expense) included a $20.8 million forfeited deposit related to a transaction we decided not to pursue and $8.0 million of income earned from the forfeiture of a deposit on a portfolio of properties whereby the purchase and sale agreement was terminated by the potential buyer.
Reimbursement by the Adviser
Pursuant to the advisory agreement between us, the Adviser and BREIT OP, the Adviser will reimburse us for any expenses that cause our Total Operating Expenses in any four consecutive fiscal quarters to exceed the greater of: (1) 2% of our Average Invested Assets or (2) 25% of our Net Income (each as defined in our charter) (the “2%/25% Limitation”).

Notwithstanding the foregoing, to the extent that our Total Operating Expenses exceed these limits and the independent directors determine that the excess expenses were justified based on unusual and nonrecurring factors that they deem sufficient, the Adviser would not be required to reimburse us.

For the four fiscal quarters ended September 30, 2021, our Total Operating Expenses exceeded the 2%/25% Limitation. Based upon a review of unusual and non-recurring factors, including but not limited to outsized performance during this period resulting in increased performance participation allocation expense, our independent directors determined that the excess expenses were justified.
Same Property Results of Operations
We evaluate our consolidated results of operations on a same property basis, which allows us to analyze our property operating results excluding acquisitions and dispositions during the periods under comparison. Properties in our portfolio are considered same property if they were owned for the full periods presented, otherwise they are considered non-same property. Recently developed properties that have not achieved stabilized occupancy (defined as 90% or greater for properties other than hotels) and properties held for sale are excluded from same property results and are considered non-same property. We do not consider our investments in the real estate debt segment to be same property.
For the three months ended September 30, 2021 and June 30, 2021, our same property portfolio consisted of 250 residential, 851 industrial, one net lease, nine data centers, 58 hotel, 119 self storage, 13 retail,and two office properties. For the nine months ended September 30, 2021 and 2020, our same property portfolio consisted of 173 residential, 748 industrial, one net lease, nine data centers, 58 hotel, seven retail, and one office property.
Same property operating results are measured by calculating same property net operating income (“NOI”). Same property NOI is a supplemental non-GAAP disclosure of our operating results that we believe is meaningful as it enables management to evaluate the impact of occupancy, rents, leasing activity, and other controllable property operating results at our real estate. We define same property NOI as operating revenues less operating expenses, which exclude (i) impairment of investments in real estate (ii) depreciation and amortization, (iii) interest expense, and (iv) other non-property related revenue and expense items such as (a) general and administrative expenses, (b) management fee, (c) performance participation allocation, (d) affiliate incentive compensation awards, (e) income from unconsolidated entities, (f) income (loss) from investments in real estate debt, (g) net gain (loss) on dispositions of real estate, (h) interest income, (i) loss on extinguishment of debt, and (j) other income (expense).
Our same property NOI may not be comparable to that of other REITs and should not be considered to be more relevant or accurate in evaluating our operating performance than the current GAAP methodology used to calculate our net income (loss).
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The following table reconciles GAAP net income (loss) attributable to BREIT stockholders to same property NOI for the three months ended September 30, 2021 and June 30, 2021 ($ in thousands):
 Three Months EndedChange
 September 30, 2021June 30, 2021$
Net income (loss) attributable to BREIT stockholders$(357,289)$(174,757)$(182,532)
Adjustments to reconcile to same property NOI
General and administrative7,106 7,789 (683)
Management fee122,866 92,183 30,683 
Performance participation allocation449,822 299,373 150,449 
Incentive compensation awards1,177 692 485 
Depreciation and amortization482,045 399,621 82,424 
Income from unconsolidated entities(78,445)(70,028)(8,417)
(Income) loss from investments in real estate debt(83,052)(116,573)33,521 
Net (gains) loss on dispositions of real estate9,586 (7,372)16,958 
Interest income(41)(9)(32)
Interest expense204,538 181,529 23,009 
Loss on extinguishment of debt3,372 2,757 615 
Other (income) expense(177,631)(125,583)(52,048)
Net income (loss) attributable to non-controlling interests in third party joint ventures(5,472)264 (5,736)
Net income (loss) attributable to non-controlling interests in BREIT OP(4,393)(2,089)(2,304)
NOI574,189 487,797 86,392 
Non-same property NOI86,767 22,346 64,421 
Same property NOI$487,422 $465,451 $21,971 
The following table details the components of same property NOI for the three months ended September 30, 2021 and June 30, 2021 ($ in thousands):
 Three Months EndedChange
 September 30, 2021June 30, 2021$%
Same property NOI    
Rental revenue$655,993 $643,513 $12,480 2%
Hospitality revenue127,507 102,661 24,846 24%
Other revenue24,813 24,741 72 —%
Total revenues808,313 770,915 37,398 5%
Rental property operating228,732 230,366 (1,634)(1)%
Hospitality operating92,159 75,098 17,061 23%
Total expenses320,891 305,464 15,427 5%
Same property NOI$487,422 $465,451 $21,971 5%
Same Property – Rental Revenue
Same property rental revenue increased $12.5 million for the three months ended September 30, 2021 compared to the three months ended June 30, 2021. The increase was due to a $9.6 million increase in base rental revenue, a $2.5 million increase in tenant reimbursement income and a $0.4 million decrease in our bad debt reserve. Our bad debt reserve represents the amount of rental revenue we anticipate we will not be able to collect from our tenants.
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The following table details the changes in base rental revenue period over period ($ in thousands):
September 30, 2021 vs. June 30, 2021
Three Months EndedChange in Base
Rental Revenue
Change in
Occupancy Rate
Change in Average
Effective Annual
Base Rent Per Leased
Square Foot/Unit(1)
September 30, 2021June 30, 2021
Residential$277,716 $272,523 $5,193 —%+4%
Industrial177,071 174,660 2,411 +1%—%
Net Lease82,795 82,795 — —%—%
Data Centers5,060 5,060 — —%—%
Self Storage28,600 26,589 2,011 —%+7%
Retail11,781 11,841 (60)1%(3)%
Office6,849 6,849 — —%—%
Total base rental revenue$589,872 $580,317 $9,555 
(1)The annualized base rent per leased square foot or unit for the three months ended September 30, 2021 and the three months ended June 30, 2021 includes straight-line rent and above-market and below-market lease amortization.
Same Property – Hospitality Revenue
Same property hospitality revenue increased $24.8 million for the three months ended September 30, 2021 compared to the three months ended June 30, 2021. As the economy continues to reopen and travel restrictions ease from the COVID-19 pandemic, we have seen a recovery in our hospitality assets. ADR for the hotels in our same property portfolio increased from $140 to $159, while occupancy increased 5% and RevPAR increased from $91 to $112 during the three months ended September 30, 2021 compared to the three months ended June 30, 2021.
Same Property – Rental Property Operating Expenses
Same property rental property operating expenses decreased $1.6 million during the three months ended September 30, 2021, compared to the three months ended June 30, 2021. The decrease in rental property operating expenses for the three months ended September 30, 2021 was primarily the result of decreased real estate taxes at our residential and industrial properties.
Same Property – Hospitality Operating Expenses
Same property hospitality operating expenses increased $17.1 million during the three months ended September 30, 2021, compared to the three months ended June 30, 2021. The increase in hospitality operating expenses was primarily the result of increased operating expenses resulting from increased occupancy at our hotels during the three months ended September 30, 2021.
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The following table reconciles GAAP net income (loss) attributable to BREIT stockholders to same property NOI for the nine months ended September 30, 2021 and 2020 ($ in thousands):
 Nine Months Ended September 30,Change
 20212020$
Net income (loss) attributable to BREIT stockholders$(503,574)$(764,376)$260,802 
Adjustments to reconcile to same property NOI
General and administrative21,855 19,025 2,830 
Management fee288,144 160,544 127,600 
Performance participation allocation892,410 — 892,410 
Incentive compensation awards3,046 969 2,077 
Impairment of investments in real estate— 12,343 (12,343)
Depreciation and amortization1,282,053 1,008,756 273,297 
Income from unconsolidated entities(183,155)(63,678)(119,477)
(Income) loss from investments in real estate debt(438,986)317,212 (756,198)
Net (gain) loss on dispositions of real estate(13,216)(100,441)87,225 
Interest income(136)(2,102)1,966 
Interest expense567,685 539,276 28,409 
Loss on extinguishment of debt9,545 6,495 3,050 
Other (income) expense(411,160)29,022 (440,182)
Net income (loss) attributable to non-controlling interests in third party joint ventures(5,149)(1,796)(3,353)
Net income (loss) attributable to non-controlling interests in BREIT OP(6,129)(10,177)4,048 
NOI1,503,233 1,151,072 352,161 
Non-same property NOI394,978 131,598 263,380 
Same property NOI$1,108,255 $1,019,474 $88,781 
 
The following table details the components of same property NOI for the nine months ended September 30, 2021 and 2020 ($ in thousands):
 Nine Months Ended September 30,Change
 20212020$%
Same property NOI    
Rental revenue$1,496,402 $1,438,892 $57,510 4%
Hospitality revenue288,310 195,213 93,097 48%
Other revenue51,753 41,127 10,626 26%
Total revenues1,836,465 1,675,232 161,233 10%
Rental property operating505,408 460,408 45,000 10%
Hospitality operating222,802 195,350 27,452 14%
Total expenses728,210 655,758 72,452 11%
Same property NOI$1,108,255 $1,019,474 $88,781 9%
Same Property – Rental Revenue
Same property rental revenue increased $57.5 million for the nine months ended September 30, 2021 compared to the corresponding period in 2020. The increase was due to a $39.5 million increase in base rental revenue and a $21.2 million increase in tenant reimbursement income. The increase was partially offset by a $3.2 million increase in our bad debt reserve. Our bad debt reserve represents the amount of rental revenue we anticipate we will not be able to collect from our tenants.
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The following table details the changes in base rental revenue period over period ($ in thousands):
2021 vs. 2020
Nine Months Ended September 30,Change in Base
Rental Revenue
Change in
Occupancy Rate
Change in Average
Effective Annual
Base Rent Per Leased
Square Foot/Unit(1)
20212020
Residential$594,735 $564,908 $29,827 +1%+5%
Industrial453,696 443,537 10,159 +1%—%
Net Lease248,384 248,384 — —%—%
Data Centers15,180 15,180 — —%—%
Retail22,075 22,574 (499)—%(2)%
Office6,206 6,206 — —%—%
Total base rental revenue$1,340,276 $1,300,789 $39,487 
 
(1)The annualized base rent per leased square foot or unit for the nine months ended September 30, 2021 and 2020 includes straight-line rent and above-market and below-market lease amortization.
Same Property – Hospitality Revenue
Same property hospitality revenue increased $93.1 million for the nine months ended September 30, 2021 compared to corresponding period in 2020. ADR for the hotels in our same property portfolio increased from $135 to $140 while occupancy increased 20% and RevPAR increased from $57 to $87 during the nine months ended September 30, 2021 compared to the nine months ended September 30, 2020.
Same Property – Other Revenue
Same property other revenue increased $10.6 million for the nine months ended September 30, 2021 compared to the corresponding period in 2020. The increase was primarily due to increased golf course revenues at our full service hotel in San Antonio, Texas and increased lease termination fees and ancillary income at our industrial properties during the nine months ended September 30, 2021.
Same Property – Rental Property Operating Expenses
Same property rental property operating expenses increased $45.0 million during the nine months ended September 30, 2021, compared to the corresponding period in 2020. The increase in rental property operating expenses for the nine months ended September 30, 2021 was primarily the result of increased real estate taxes and general operating expenses at our industrial and residential properties.
Same Property – Hospitality Operating Expenses
Same property hospitality operating expenses increased $27.5 million during the nine months ended September 30, 2021, compared to the corresponding period in 2020. The increase in hospitality operating expenses was primarily the result of increased operating expenses resulting from increased occupancy at our hotels during the nine months ended September 30, 2021.
Non-same Property NOI
Due to our substantial fundraising and continued deployment of the net proceeds raised into new property acquisitions, non-same property NOI is not comparable period-over-period. We expect the non-same property NOI variance period-over-period to continue as we raise more proceeds from selling shares of our common stock and invest in additional new property acquisitions.
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Funds from Operations, Adjusted Funds from Operations and Funds Available for Distribution
We believe funds from operations (“FFO”) is a meaningful non-GAAP supplemental measure of our operating results. Our condensed consolidated financial statements are presented using historical cost accounting which, among other things, requires depreciation of real estate investments to be calculated on a straight-line basis. As a result, our operating results imply that the value of our real estate investments have decreased over time. However, we believe that the value of our real estate investments will fluctuate over time based on market conditions and, as such, depreciation under historical cost accounting may be less informative as a measure of our performance. FFO is an operating measure defined by the National Association of Real Estate Investment Trusts (“NAREIT”) that is broadly used in the REIT industry. FFO, as defined by NAREIT and presented below, is calculated as net income or loss (computed in accordance with GAAP), excluding (i) depreciation and amortization, (ii) impairment of investments in real estate, (iii) net gains or losses from sales of real estate, and (iv) similar adjustments for non-controlling interests and unconsolidated entities.
We also believe that adjusted FFO (“AFFO”) is an additional meaningful non-GAAP supplemental measure of our operating results. AFFO further adjusts FFO to reflect the performance of our portfolio by adjusting for items we believe are not directly attributable to our operations. Our adjustments to FFO to arrive at AFFO include removing the impact of (i) straight-line rental income and expense, (ii) amortization of above- and below-market lease intangibles, (iii) amortization of mortgage premium/discount, (iv) unrealized losses (gains) from changes in fair value of financial instruments, (v) net forfeited investment deposits, (vi) amortization of restricted stock awards, (vii) the performance participation allocation to our Special Limited Partner or other incentive compensation awards that are based on our Net Asset Value, which includes unrealized gains and losses not recorded in GAAP net income (loss), and that are paid in shares or BREIT OP units, even if subsequently repurchased by us, (viii) gain or loss on involuntary conversion, (ix) amortization of deferred financing costs, (x) losses (gains) on extinguishment of debt, and (xi) similar adjustments for non-controlling interests and unconsolidated entities.
We also believe that funds available for distribution (“FAD”) is an additional meaningful non-GAAP supplemental measure of our operating results. FAD provides useful information for considering our operating results and certain other items relative to the amount of our distributions. Further, FAD is a metric, among others, that is considered by our board of directors and executive officers when determining the amount of our dividend to stockholders, and we believe is therefore meaningful to stockholders. FAD is calculated as AFFO adjusted for (i) management fees paid in shares or BREIT OP units, even if subsequently repurchased by us, (ii) realized losses (gains) on financial instruments, (iii) recurring tenant improvements, leasing commissions, and other capital expenditures, (iv) stockholder servicing fees paid during the period, and (v) similar adjustments for non-controlling interests and unconsolidated entities. FAD is not indicative of cash available to fund our cash needs and does not represent cash flows from operating activities in accordance with GAAP, as FAD is adjusted for stockholder servicing fees and recurring tenant improvements, leasing commission, and other capital expenditures, which are not considered when determining cash flows from operations. Furthermore, FAD excludes (i) adjustments for working capital items and (ii) amortization of discounts and premiums on investments in real estate debt. Cash flows from operating activities in accordance with GAAP would generally be adjusted for such items.
FFO, AFFO, and FAD should not be considered more relevant or accurate than GAAP net income (loss) in evaluating our operating performance. In addition, FFO, AFFO, and FAD should not be considered as alternatives to net income (loss) as indications of our performance or as alternatives to cash flows from operating activities as indications of our liquidity, but rather should be reviewed in conjunction with these and other GAAP measurements. Further, FFO, AFFO, and FAD are not intended to be used as liquidity measures indicative of cash flow available to fund our cash needs, including our ability to make distributions to our stockholders. In addition, our methodology for calculating AFFO and FAD may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported AFFO and FAD may not be comparable to the AFFO and FAD reported by other companies.
During the first quarter of 2021, we updated our definitions of AFFO and FAD to exclude the impact of the amortization of deferred financing costs (“DFCs”) on our debt, which is included in GAAP net income (loss). We do not consider the amortization of DFCs to be directly attributable to our operations and view DFCs similar to acquisition expenses, which are capitalized into the cost basis of our investments, and therefore excluded from AFFO and FAD. We believe that excluding amortization of DFCs from our calculations of AFFO and FAD results in metrics that better reflect the results of our operations. Prior period disclosures of AFFO and FAD were updated to conform to our updated definitions of AFFO and FAD.
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The following table presents a reconciliation of net income (loss) attributable to BREIT stockholders to FFO, AFFO and FAD attributable to BREIT stockholders ($ in thousands):
 
 Three Months Ended
September 30,
Nine Months Ended
September 30,
 2021202020212020
Net (loss) income attributable to BREIT stockholders$(357,289)$121,272 $(503,574)$(764,376)
Adjustments to arrive at FFO:
Depreciation and amortization528,631 343,058 1,349,590 1,035,104 
Impairment of investments in real estate— 6,217 — 12,343 
Net (gain) loss on dispositions of real estate13,920 (100,070)(8,882)(100,441)
Amount attributable to non-controlling interests for above adjustments(19,575)(8,102)(39,545)(29,664)
FFO attributable to BREIT stockholders165,687 362,375 797,589 152,966 
Adjustments to arrive at AFFO:
Straight-line rental income and expense(39,537)(37,285)(120,919)(114,273)
Amortization of above and below-market lease intangibles(4,624)(5,133)(15,081)(13,237)
Amortization of mortgage premium/discount(489)(299)(1,453)(871)
Unrealized (gains) losses from changes in fair value of financial instruments(1)
(248,930)(164,123)(786,453)484,332 
Net forfeited investment deposits— — — 12,750 
Amortization of restricted stock awards153 100 399 300 
Non-cash performance participation allocation449,822 — 892,410 — 
Non-cash incentive compensation awards1,177 (31)3,046 969 
Gain on involuntary conversion— (90)— (270)
Amortization of deferred financing costs16,576 10,534 43,274 30,533 
Loss on extinguishment of debt3,372 5,258 9,545 6,495 
Amount attributable to non-controlling interests for above adjustments(1,902)3,564 2,446 (1,464)
AFFO attributable to BREIT stockholders341,305 174,870 824,803 558,230 
Adjustments to arrive at FAD:
Non-cash management fee122,866 57,619 288,144 160,544 
Recurring tenant improvements, leasing commissions, and other capital expenditures(2)
(66,322)(32,152)(151,363)(85,901)
Stockholder servicing fees(32,381)(17,043)(78,735)(48,111)
Realized (gains) losses on financial instruments(1)
(11,295)20,387 2,408 8,410 
Amount attributable to non-controlling interests for above adjustments(689)(596)(2,093)(1,114)
FAD attributable to BREIT stockholders$353,484 $203,085 $883,164 $592,058 
 
(1)Unrealized (gains) losses from changes in fair value of financial instruments primarily relates to mark-to-market changes on both our investments in real estate debt and our investments in equity securities. Realized (gains) losses on financial instruments primarily results from the sale of our investments in real estate debt and our investments in equity securities.
(2)Recurring tenant improvements and leasing commissions are generally related to second-generation leases and other capital expenditures required to maintain our investments. Other capital expenditures exclude underwritten tenant improvements, leasing commissions and capital expenditures in conjunction with acquisitions and projects that we believe will enhance the value of our investments.
Net Asset Value
The purchase price per share for each class of our common stock will generally equal our prior month’s NAV per share, plus applicable selling commissions and dealer manager fees. Our NAV for each class of shares is based on the estimated fair value of our investments (including investments in real estate debt) and any other assets (such as cash on hand), and is reduced by our liabilities, including the accrual of any performance participation allocation, and any stockholder servicing fees applicable to such class of shares.
For more information on our Net Asset Value Calculation and Valuation Guidelines please refer to our prospectus. Please also refer to Item 1A Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2020 and our prospectus dated February 12, 2021 and filed with the SEC, as supplemented for additional disclosure relating to material trends or uncertainties that may impact our business.
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The following table shows the change in NAV per share for BREIT's various classes of common stock during the quarter ended September 30, 2021. This price movement was primarily driven by increases in the value of our residential, industrial, data centers and net lease properties.
September 30, 2021June 30, 2021Change
Class S NAV per share$13.51 $12.63 $0.88 
Class I NAV per share$13.50 $12.61 $0.89 
Class T NAV per share$13.32 $12.43 $0.89 
Class D NAV per share$13.26 $12.43 $0.83 
Our total NAV presented in the following tables includes the NAV of our Class S, Class I, Class T, and Class D common shares, as well as partnership interests of BREIT OP held by parties other than us. The following table provides a breakdown of the major components of our total NAV as of September 30, 2021 ($ and shares/units in thousands):
 
Components of NAVSeptember 30, 2021
Investments in real estate$55,760,214 
Investments in real estate debt6,902,995 
Investments in unconsolidated entities4,510,948 
Cash and cash equivalents1,560,719 
Restricted cash2,070,369 
Other assets4,048,629 
Mortgage notes, term loans, and revolving credit facilities, net(25,096,034)
Secured financings of investments in real estate debt(2,767,399)
Subscriptions received in advance(1,720,934)
Other liabilities(1,313,306)
Accrued performance participation allocation(892,410)
Management fee payable(44,778)
Accrued stockholder servicing fees(1)
(11,421)
Non-controlling interests in joint ventures(1,128,327)
Net Asset Value$41,879,265 
Number of outstanding shares/units3,106,127 
 
(1)Stockholder servicing fees only apply to Class S, Class T, and Class D shares. See Reconciliation of Stockholders’ Equity and BREIT OP Partners’ Capital to NAV below for an explanation of the difference between the $11.4 million accrued for purposes of our NAV and the $1.0 billion accrued under U.S. GAAP.
The following table provides a breakdown of our total NAV and NAV per share/unit by class as of September 30, 2021 ($ and shares/units in thousands, except per share/unit data):
NAV Per ShareClass S
Shares
Class I
Shares
Class T
Shares
Class D
Shares
Third-party
Operating
Partnership
Units (1)
Total
Monthly NAV$14,612,982 $22,768,211 $718,305 $3,230,211 $549,556 $41,879,265 
Number of outstanding shares/units1,081,497 1,686,440 53,946 243,538 40,706 3,106,127 
NAV Per Share/Unit as of September 30, 2021$13.5118 $13.5008 $13.3152 $13.2637 $13.5008 
 
(1)Includes the partnership interests of BREIT OP held by the Special Limited Partner, Class B unitholders, and other BREIT OP interests held by parties other than us.
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The following table details the weighted average discount rate and exit capitalization rate by property type, which are the key assumptions used in the discounted cash flow valuations as of September 30, 2021:
 
Property TypeDiscount RateExit Capitalization Rate
Residential6.7%4.9%
Industrial5.9%5.0%
Net Lease6.9%6.1%
Data Centers5.9%5.2%
Hospitality9.2%9.5%
Self Storage7.0%5.4%
Retail7.2%5.7%
Office6.6%5.3%
These assumptions are determined by the Adviser and reviewed by our independent valuation advisor. A change in these assumptions would impact the calculation of the value of our property investments. For example, assuming all other factors remain unchanged, the changes listed below would result in the following effects on our investment values: 
InputHypothetical
Change
Residential Investment
Values
Industrial
Investment
Values
Net Lease
Investment
Values
Hospitality
Investment
Values
Data Center Investment ValuesSelf Storage
Investment
Values
Retail
Investment
Values
Office
Investment
Values
Discount Rate0.25% decrease+1.9%+1.4%+1.8%+1.7%+1.9%+2.5%+1.8%+1.9%
(weighted average)0.25% increase(1.9)%(2.5)%(1.8)%(1.7)%(1.9)%(1.2)%(1.8)%(1.9)%
Exit Capitalization Rate0.25% decrease+3.5%+3.0%+2.4%+1.3%+3.4%+2.9%+2.7%+3.3%
(weighted average)0.25% increase(3.2)%(3.9)%(2.2)%(1.3)%(3.0)%(2.8)%(2.6)%(3.0)%
 
The following table reconciles stockholders’ equity and BREIT OP partners’ capital per our condensed consolidated balance sheet to our NAV ($ in thousands): 
 September 30, 2021
Stockholders’ equity$29,238,404 
Non-controlling interests attributable to BREIT OP409,602 
Redeemable non-controlling interest320 
Total partners’ capital of BREIT OP under GAAP29,648,326 
Adjustments:
Accrued stockholder servicing fee1,017,461 
Organization and offering costs2,557 
Accrued affiliate incentive compensation awards(53,878)
Accumulated depreciation and amortization under GAAP3,952,876 
Unrealized net real estate and real estate debt appreciation7,311,923 
NAV$41,879,265 
 
The following details the adjustments to reconcile GAAP stockholders’ equity and total partners’ capital of BREIT OP to our NAV:

Accrued stockholder servicing fee represents the accrual for the cost of the stockholder servicing fee for Class S, Class T, and Class D shares. Under GAAP, we accrued the full cost of the stockholder servicing fee payable over the life of each share (assuming such share remains outstanding the length of time required to pay the maximum stockholder servicing fee) as an offering cost at the time we sold the Class S, Class T, and Class D shares. Refer to Note 2 to the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2020 for further details of the GAAP treatment regarding the stockholder servicing fee. For purposes of calculating NAV, we recognize the stockholder servicing fee as a reduction of NAV on a monthly basis when such fee is paid.

The Adviser agreed to advance certain organization and offering costs on our behalf through December 31, 2017. Such costs are reimbursed to the Adviser on a pro-rata basis over a 60 month period beginning January 1, 2018. Under GAAP,
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organization costs are expensed as incurred and offering costs are charged to equity as such amounts are incurred. For purposes of calculating NAV, such costs are recognized as a reduction to NAV as they are reimbursed ratably over the 60 month reimbursement period.

Under GAAP, the affiliate incentive compensation awards are valued as of grant date and compensation expense is recognized over the service period on a straight-line basis with an offset to equity, resulting in no impact to Stockholders’ Equity. For purposes of calculating NAV, we value the awards based on the performance in the applicable period and deduct such value from NAV.

We depreciate our investments in real estate and amortize certain other assets and liabilities in accordance with GAAP. Such depreciation and amortization is not recorded for purposes of calculating our NAV. 

Our investments in real estate are presented at their depreciated cost basis in our GAAP consolidated financial statements. Additionally, our mortgage notes, term loans, secured and unsecured revolving credit facilities, and repurchase agreements (“Debt”) are presented at their amortized cost basis in our consolidated GAAP financial statements. As such, any increases or decreases in the fair market value of our investments in real estate or our Debt are not included in our GAAP results. For purposes of calculating our NAV, our investments in real estate and our Debt are recorded at fair value.
Distributions
Beginning in March 2017, we declared monthly distributions for each class of our common stock, which are generally paid 20 days after month-end. We have paid distributions consecutively each month since that time. Each class of our common stock received the same aggregate gross distribution of $0.4852 per share for the nine months ended September 30, 2021. The net distribution varies for each class based on the applicable stockholder servicing fee, which is deducted from the monthly distribution per share and paid directly to the applicable distributor. The table below details the net distribution for each of our share classes for the nine months ended September 30, 2021: 
 Class S
Shares
Class I
Shares
Class T
Shares
Class D
Shares
January 31, 2021$0.0451 $0.0535 $0.0452 $0.0511 
February 28, 20210.0451 0.0528 0.0452 0.0506 
March 31, 20210.0451 0.0537 0.0452 0.0512 
April 30, 20210.0451 0.0535 0.0452 0.0511 
May 31, 20210.0451 0.0541 0.0453 0.0515 
June 30, 20210.0451 0.0539 0.0452 0.0513 
July 31, 20210.0451 0.0544 0.0452 0.0517 
August 31, 20210.0451 0.0547 0.0453 0.0519 
September 30, 20210.0451 0.0546 0.0452 0.0519 
Total$0.4059 $0.4852 $0.4070 $0.4623 
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The following tables summarize our distributions declared during the three and nine months ended September 30, 2021 and 2020 ($ in thousands):
 Three Months Ended September 30, 2021Three Months Ended September 30, 2020
 AmountPercentageAmountPercentage
Distributions    
Payable in cash$210,907 48 %$114,329 47 %
Reinvested in shares227,515 52 %130,710 53 %
Total distributions$438,422 100 %$245,039 100 %
Sources of Distributions
Cash flows from operating activities$438,422 100 %$245,039 100 %
Offering proceeds— — %— — %
Total sources of distributions$438,422 100 %$245,039 100 %
Cash flows from operating activities$517,171 $252,656 
Funds from Operations(1)
$165,687 $362,375 
Adjusted Funds from Operations(1)
$341,305 $174,870 
Funds Available for Distribution(1)
$353,484 $203,085 
Nine Months Ended September 30, 2021Nine Months Ended September 30, 2020
AmountPercentageAmountPercentage
Distributions
Payable in cash$508,359 47 %$317,527 46 %
Reinvested in shares567,936 53 %368,968 54 %
Total distributions$1,076,295 100 %$686,495 100 %
Sources of Distributions
Cash flows from operating activities$1,076,295 100 %$686,495 100 %
Offering proceeds— — %— — %
Total sources of distributions$1,076,295 100 %$686,495 100 %
Cash flows from operating activities$1,190,413 $729,451 
Funds from Operations(1)
$797,589 $152,966 
Adjusted Funds from Operations(1)
$824,803 $558,230 
Funds Available for Distribution(1)
$883,164 $592,058 
 
(1)See “—Funds from Operations and Adjusted Funds from Operations and Funds Available for Distribution” above for descriptions of Funds from Operations (FFO), Adjusted Funds from Operations (AFFO), and Funds Available for Distribution (FAD), for reconciliations of them to GAAP net loss attributable to BREIT stockholders, and for considerations on how to review these metrics.
Through September 30, 2021, our distributions have been funded entirely from cash flows from operations.
Liquidity and Capital Resources
Liquidity
We believe we have sufficient liquidity to operate our business, with $7.1 billion of immediate liquidity as of November 1, 2021, comprising $4.2 billion of undrawn revolving and line of credit capacity and $2.9 billion of cash on hand. In addition to our immediate liquidity, we obtain incremental liquidity through the sale of our common stock, from which we generated $15.7 billion during the nine months ended September 30, 2021. In addition, we may incur indebtedness secured by our real estate and real estate debt investments, borrow money through unsecured financings, or incur other forms of indebtedness. We may also generate incremental liquidity through the sale of our real estate and real estate debt investments.
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Our primary liquidity needs are to fund our investments, make distributions to our stockholders, repurchase shares of our common stock pursuant to our share repurchase plan, pay operating expenses, fund capital expenditures, repay indebtedness, and pay debt service on our outstanding indebtedness. Our operating expenses include, among other things, the management fee we pay to the Adviser and the performance participation allocation that BREIT OP pays to the Special Limited Partner, both of which will impact our liquidity to the extent the Adviser or the Special Limited elect to receive such payments in cash, or subsequently redeem shares or OP units previously issued to them.
Our cash needs for acquisitions and other capital investments will be funded primarily from the sale of shares of our common stock and through the incurrence or assumption of debt. Other potential future sources of capital include secured or unsecured financings from banks or other lenders and proceeds from the sale of assets. If necessary, we may use financings or other sources of capital in the event of unforeseen significant capital expenditures.

We continue to believe that our current liquidity position is sufficient to meet the need of our expected investment activity.
Capital Resources
As of September 30, 2021, our indebtedness included loans secured by our properties, master repurchase agreements and other financing agreements with lenders secured by our investments in real estate debt, and unsecured revolving credit facilities.
The following table is a summary of our indebtedness as of September 30, 2021 ($ in thousands):
September 30, 2021Principal Balance as of
Indebtedness
Weighted
Average
Interest Rate(1)
Weighted
Average
Maturity Date(2)
Maximum
Facility
Size
September 30, 2021December 31, 2020
Fixed rate loans secured by our properties:
Fixed rate mortgages3.5%8/31/2027N/A$14,158,332 $13,124,595 
Variable rate loans secured by our properties:
Variable rate mortgages and term loansL+1.7%9/27/2025N/A9,653,874 6,305,964 
Variable rate secured revolving credit facilitiesL+1.5%10/28/2025$2,185,344 729,325 481,725 
Variable rate warehouse facilitiesL+2.1%9/27/2022$1,875,000 484,023 — 
Variable rate mezzanine loansL+3.5%3/9/2025N/A71,100 202,200 
Total variable rate loansL+1.8%8/11/202510,938,322 6,989,889 
Total loans secured by our properties2.8%10/8/202625,096,654 20,114,484 
Secured financings of investments in real estate debt:
Secured financings of investments in real estate debt(3)
L+1.0%8/2/2022N/A2,767,399 2,140,993 
Unsecured loans:
Unsecured variable rate revolving credit facilityL+2.5%2/22/20241,900,000 — — 
Affiliate line of creditL+2.5%1/22/2022100,000 — — 
Total unsecured loans2,000,000 — — 
Total indebtedness$27,864,053 $22,255,477 
 
(1)The term “L” refers to the relevant floating benchmark rates, which include one-month LIBOR, 30-day SOFR, and one-month CDOR, as applicable with respect to each loan secured by our properties and each unsecured loan.
(2)For loans where we, at our sole discretion, have extension options, the maximum maturity date has been assumed.
(3)Weighted average interest rate of L+1.0% reflects the spread over the relevant floating benchmark rates, which include USD LIBOR, GBP LIBOR, EURIBOR, and SONIA, as applicable to each secured financing.
We had registered with the Securities and Exchange Commission (the “SEC”), two offerings for an aggregate of up to $17.0 billion in shares of common stock (the “Previous Offerings”) and accepted gross offering proceeds of $16.3 billion during the period January 1, 2017 to February 1, 2021. The Company subsequently registered with the SEC a follow-on offering of up to $24.0 billion in shares of common stock, consisting of up to $20.0 billion in shares in its primary offering and up to $4.0 billion in shares pursuant to its distribution reinvestment plan, which we began using to offer shares of our common stock in February 2021 (the “Current Offering”
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and with the Previous Offerings, the “Offering”). The share classes have different upfront selling commissions and ongoing stockholder servicing fees.
As of November 12, 2021, we had received net proceeds of $13.2 billion from selling an aggregate of 1,053,706,918 shares of our common stock in the Current Offering (consisting of 451,850,298 Class S shares, 453,322,330 Class I shares, 11,477,373 Class T shares, and 137,056,917 Class D shares).
Cash Flows
The following table provides a breakdown of the net change in our cash and cash equivalents and restricted cash ($ in thousands):
 Nine Months Ended September 30,
 20212020
Cash flows provided by operating activities$1,190,413 $729,451 
Cash flows used in investing activities(17,642,285)(5,373,918)
Cash flows provided by financing activities19,037,502 4,243,354 
Net increase in cash and cash equivalents and restricted cash$2,585,630 $(401,113)
Cash flows provided by operating activities increased $461.0 million during the nine months ended September 30, 2021 compared to the corresponding period in 2020 due to increased cash flows from the operations of our investments in real estate and income on our investments in real estate debt.
Cash flows used in investing activities increased $12.3 billion during the nine months ended September 30, 2021 compared to the corresponding period in 2020. The increase was primarily due to a net increase of $6.8 billion in the acquisitions of and capital improvements to real estate investments, an increase of $2.5 billion in investments in unconsolidated entities, a net increase of $1.1 billion related to our investments in real estate-related equity securities, a net increase of $1.1 billion in our investments in real estate debt and an increase of $535.3 million related to pre-acquisition costs and deposits. This was partially offset by a decrease of $190.7 million in proceeds from dispositions of real estate.
Cash flows provided by financing activities increased $14.8 billion during the nine months ended September 30, 2021 compared to the corresponding period in 2020 primarily due to an increase of $9.1 billion from the issuance of our common stock, a net increase in borrowings of $3.6 billion, an increase of $1.5 billion in subscriptions received in advance, an increase in contributions from non-controlling interests of $614.7 million, and an increase of $172.8 million in distributions.

Critical Accounting Policies
The preparation of the financial statements in accordance with GAAP involves significant judgments and assumptions and requires estimates about matters that are inherently uncertain. These judgments will affect our reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our condensed consolidated financial statements. We consider our accounting policies over investments in real estate and lease intangibles, investments in real estate debt, and revenue recognition to be our critical accounting policies. See Note 2 to the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2020 for further descriptions of such accounting policies.
Critical Accounting Estimates
The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates.
Allocation of Purchase Price for Investments in Real Estate
Upon the acquisition of a property, we assess the fair value of the acquired tangible and intangible assets (including land, buildings, tenant improvements, “above-market” and “below-market” leases, acquired in-place leases, other identified intangible assets and assumed liabilities) and we allocate the purchase price to the acquired assets and assumed liabilities on a relative fair value basis. Generally, the most significant portion of the allocation is to building and land and requires the use of market-based estimates and assumptions. We determine and consider fair value based on estimated cash flow projections that utilize appropriate discount and/or
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capitalization rates, as well as other available market information. Estimates of future cash flows are based on a number of factors including the historical operating results, known and anticipated trends, and market and economic conditions.
The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant. We also allocate purchase price to other acquired intangibles, including acquired in-place leases that may have a customer relationship intangible value. The valuation of such lease intangibles includes (but is not limited to) the nature and extent of the existing relationship with the tenants, the tenants’ credit quality, and expectations of lease renewals.
Acquired above-market and below-market leases are recorded at their fair values (using a discount rate which reflects the risks associated with the leases acquired) equal to the difference between (1) the contractual amounts to be paid pursuant to each in-place lease and (2) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases. Other intangible assets acquired include amounts for in-place lease values that are based on our evaluation of the specific characteristics of each tenant’s lease. Factors to be considered include estimates of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, we include real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, we consider leasing commissions, legal and other related expenses.
Recent Accounting Pronouncements
See Note 2 — “Summary of Significant Accounting Policies” to our condensed consolidated financial statements in this quarterly report on Form 10-Q for a discussion concerning recent accounting pronouncements.
Off-Balance Sheet Arrangements
We currently have no off-balance sheet arrangements that are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Contractual Obligations
 
The following table aggregates our contractual obligations and commitments with payments due subsequent to September 30, 2021 ($ in thousands).
 
ObligationsTotalLess than
1 year
1-3 years3-5 yearsMore than
5 years
Indebtedness(1)
$32,134,794 $4,568,716 $5,123,566 $8,912,265 $13,530,247 
Ground leases1,208,153 7,308 16,641 17,694 1,166,510 
Organizational and offering costs2,557 2,045 512 — — 
Other3,597 2,398 1,199 — — 
Total$33,349,101 $4,580,467 $5,141,918 $8,929,959 $14,696,757 
 
(1)The allocation of our indebtedness includes both principal and interest payments based on the fully extended maturity date and interest rates in effect at September 30, 2021.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to interest rate risk with respect to our variable-rate indebtedness, whereas an increase in interest rates would directly result in higher interest expense. We seek to manage our exposure to interest rate risk by utilizing a mix of fixed and floating rate financings with staggered maturities and through interest rate hedging agreements to fix or cap a portion of our variable rate debt. As of September 30, 2021, the outstanding principal balance of our variable rate indebtedness was $13.7 billion and consisted of mortgage notes, term loans, secured and unsecured revolving credit facilities, and secured financings on investments in real estate debt.        
Certain of our mortgage notes, term loans, secured and unsecured revolving credit facilities and secured financings are variable rate and indexed to one-month U.S. Dollar denominated LIBOR, three-month U.S. Dollar denominated LIBOR, three-month GBP denominated LIBOR, or three-month Euro denominated LIBOR (collectively, the “Reference Rates”). For the three and nine months ended September 30, 2021, a 10 basis point increase in each of the Reference Rates would have resulted in increased interest expense of $2.9 million and $7.5 million, respectively.
LIBOR and certain other floating rate benchmark indices to which our floating rate loans and other loan agreements are tied, including, without limitation, the Euro Interbank Offered Rate (collectively, "IBORs"), are the subject of recent national, international and regulatory guidance and proposals for reform. On March 5, 2021, the Financial Conduct Authority of the U.K., (the "FCA"), which has statutory powers to require panel banks to contribute to LIBOR where necessary, announced it would cease publication of certain IBORs, including one-week and two-month U.S. Dollar denominated LIBOR and all tenors of GBP LIBOR, immediately after December 31, 2021 and cease publication of the remaining tenors of U.S. Dollar denominated LIBOR immediately after June 30, 2023. Additionally, the Federal Reserve Board, Federal Deposit Insurance Corporation, Office of the Comptroller of Currency, and other interagency regulatory bodies have advised banks to stop entering into new LIBOR based contracts by December 31, 2021. The U.S. Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, has identified the Secured Overnight Financing Rate ("SOFR"), a new index calculated using short-term repurchase agreements, backed by Treasury securities, as its preferred alternative rate for U.S. Dollar denominated LIBOR. In the U.K., the Bank of England’s working group on Sterling risk free rates set March 31, 2021 as the target date under which GBP LIBOR may no longer be used as the reference rate for new loan products with maturities after December 31, 2021. Market participants have started to transition to the Sterling Overnight Index Average, ("SONIA"), in line with guidance from the U.K. regulators. At this time, it is not possible to predict how markets will respond to SOFR, SONIA, or other alternative reference rates as the transition away from the IBOR benchmarks proceeds. Despite the LIBOR transition in other markets, benchmark rate methodologies in Europe, Canada, and Australia have been reformed and rates such as the Euro Interbank Offered Rate ("EURIBOR"), the Stockholm Interbank Offered Rate ("STIBOR"), the Canadian Dollar Offered Rate ("CDOR"), and the Australian Bank Bill Swap Reference Rate ("BBSY"), may persist as International Organization of Securities Commissions ("IOSCO"), compliant reference rates moving forward. However, multi-rate environments may persist in these markets as regulators and working groups have suggested market participants adopt alternative reference rates. Refer to “Part I. Item 1A. Risk Factors — Risks Related to Debt Financing — Changes to, or the elimination of, LIBOR may adversely affect interest expense related to borrowings under our credit facilities and real estate-related investments” of our Annual Report on Form 10-K for the year ended December 31, 2020.
Investments in Real Estate Debt
As of September 30, 2021, we held $6.9 billion of investments in real estate debt. Our investments in real estate debt are primarily floating-rate and indexed to the Reference Rates or the Sterling Overnight Index Average, and as such, exposed to interest rate risk. Our net income will increase or decrease depending on interest rate movements. While we cannot predict factors that may or may not affect interest rates, for the three and nine months ended September 30, 2021, a 10 basis point increase or decrease in the Reference Rates would have resulted in an increase or decrease to income from investments in real estate debt of $0.9 million and $2.2 million, respectively.
We may also be exposed to market risk with respect to our investments in real estate debt due to changes in the fair value of our investments. We seek to manage our exposure to market risk with respect to our investments in real estate debt by making investments in real estate debt backed by different types of collateral and varying credit ratings. The fair value of our investments may fluctuate, therefore the amount we will realize upon any sale of our investments in real estate debt is unknown. However, as of September 30, 2021, a 10% change in the fair value of our investments in real estate debt would result in a change in the carrying value of our investments in real estate debt of $690.3 million.

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ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
An evaluation of the effectiveness of the design and operation of our “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of the end of the period covered by this quarterly report on Form 10-Q was made under the supervision and with the participation of our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”). Based upon this evaluation, our CEO and CFO have concluded that as of the end of the period covered by this report our disclosure controls and procedures (a) were effective to ensure that information required to be disclosed by us in reports filed or submitted under the Exchan