Blackstone Group LP (BX.N) Chief Executive Stephen Schwarzman’s earnings from dividends and pay soared by 75 percent to $374.5 million in 2013, underpinning his firm’s strong profits in real estate, private equity, credit and hedge funds, the company’s annual report showed on Friday.
The jump came as Blackstone’s distributable earnings increased by 66 percent to $1.9 billion in 2013, thanks to favorable capital markets that allowed it to sell more assets at a higher valuation.
Most of Schwarzman’s profit came from the roughly one-fifth ownership stake he holds in Blackstone. He received $352.5 million in dividends and $22 million in executive compensation. The vast majority of the compensation comes from so-called carried interest — Blackstone’s cut of the investment profits of its funds.
Schwarzman, 67, whose net worth is pegged by Forbes at $7.7 billion, co-founded Blackstone in 1985 with Peter Peterson; in 2002 he brought in veteran investment banker Tony James as his right-hand man. Together, they took Blackstone public in 2007.
Real estate was the biggest driver of Blackstone’s earnings in 2013, which was reflected in the earnings of Jonathan Gray, who heads that business. The 44-year-old, one of the candidates to eventually succeed Schwarzman, took home $114.7 million from dividends and pay in 2013, up 57 percent from a year ago.
James, 63, took home $99 million from dividends and compensation as Blackstone’s president and chief operating officer, up 50 percent from a year ago.
Peer Carlyle Group LP (CG.O) disclosed on Thursday that its founders — David Rubenstein, William Conway and Daniel D’Aniello — each received $92.9 million in dividends and salaries in 2013, up from $57.6 million in 2012.
KKR & Co LP (KKR.N) revealed on Monday that founders Henry Kravis and George Roberts received $161.4 million and $165.5 million, respectively, in cash dividends and executive pay in 2013, up by more than 17 percent from 2012.
Blackstone also revealed that Schwarzman and James received $78.2 million and $15.7 million, respectively, as a result of their personal investments in Blackstone’s funds. It did not disclose how much of that money was profit versus capital returned.
(Reporting by Greg Roumeliotis; Editing by Leslie Adler)
Photo courtesy of Reuters/China Daily.