We're Betting Big on Residential Real Estate: Blackstone CEO
Blackstone Group is betting heavily on residential real estate, Chairman and CEO Stephen Schwarzman told CNBC on Monday.
"Blackstone is now the largest owner of individual houses in the United States," Schwarzman told CNBC's "Squawk on the Street" Monday, pointing to his company's $3 billion portfolio of residential real estate.
But given the nascent recovery in the housing market, they're not buying and selling them quickly but rather renting them out.
"It's a good business for us. It's a new thing, but it's also good for America," he said.
Schwarzman pointed to real strength in the automobile industry and housing as reasons to be bullish on the U.S. economy, citing increasing production in autos and average home prices heading higher in the last year.
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Schwarzman also said that U.S. energy independence would be a major boon for the domestic economy.
"Everywhere I travel, [U.S. energy potential] is about the first thing that people talk about. If we can create energy in very large amounts at some of the lowest prices in the world, it's very logical that people from outside the United States are going to start businesses in the United States."
Schwarzman also predicted that there would be a "dramatic increase" in companies that utilize the energy chain, "if you can foresee a world in the future with natural gas powered automobiles, the savings would be absolutely huge and that would go into consumers' pockets," he said.
Schwarzman's company is also looking to support entrepreneurship in the U.S. through the Blackstone Charitable foundation and the Blackstone "LaunchPad" program, which this week was extended to the University of Central Florida.
"It's quite an interesting way to engage people with a wide range of outcomes," Schwarzman said. "A good idea can still overcome [regulations]. Some of the regulations are needed and some are creating difficulty for businesses," he said, in response to Subway founder Fred Deluca's comments on CNBC earlier this month that Subway 'would not exist' if similar regulations were in place when the company started.
The company is offering a $1.4 million grant as part of a $50 million entrepreneurship initiative. The company says that 60,000 students will have access to the program and estimates a potential to create 300 new ventures over the next 5 years.