Blackstone closed its seventh European opportunistic real estate fund at €9.8bn ($10.8bn), setting a new record for capital raised in the region despite a prolonged market correction.

The vehicle, Blackstone Europe Real Estate Partners VII, is the largest external capital pool the firm has ever raised for European property and slightly exceeds its previous record. The fundraising spanned two years, during a period marked by falling asset valuations and rising interest rates that brought an end to a decade of ultra-cheap capital.

The successful close underlines Blackstone’s continued dominance in real estate fundraising and highlights investor confidence in the firm’s ability to navigate cyclical volatility. According to James Seppala, head of European real estate at Blackstone, the latest raise coincides with early signs of recovery in the market.

“We’re grateful to our limited partners for their continued trust,” said Seppala, noting that Blackstone launched the fund in February 2023 at a time of heightened disruption across the European property sector.

The new fund brings Blackstone’s total capital available for deployment across its three flagship opportunistic real estate strategies to $47bn. The close cements the firm’s position as a major buyer-in-waiting, with considerable dry powder available to target distressed or mispriced assets as conditions stabilise.

Blackstone’s move comes amid renewed interest in opportunistic real estate strategies from institutional investors seeking to capitalise on dislocation and pricing resets across commercial property markets.