Hard Assets in a Changing World

June 11, 2026

Hard assets, such as infrastructure and real estate, support the movement of data, goods, power, and people.

Their relevance is being amplified by changes in how the economy operates—including AI adoption and rising data consumption, e-commerce, supply chain reconfiguration, and growing power demand. These shifts are increasingly shaped by a global push toward resilience, defense, and domestic capacity across energy systems, supply chains, and critical infrastructure.

In real estate, a cyclical recovery adds another layer of opportunity, as a prolonged period of constrained capital and limited new construction has improved supply-demand dynamics across select sectors. Taken together, these trends are creating attractive opportunities—largely in private markets.

In a period marked by disruption, investors are increasingly looking to hard assets for the potential for returns, diversification, income, and inflation mitigation:

Since 2022, stock-bond portfolio volatility has risen meaningfully vs. the prior decade ^{[ 1 ]}
Against this backdrop, institutional investors’ plans to increase real estate allocations in 2026 are at a six-year high ^{[ 2 ]}

In our view, infrastructure and real estate can serve as complementary building blocks within modern portfolios —offering exposure to both structural growth and cyclical recovery across hard assets.

Higher Volatility: 60/40 Portfolio ^{[ 1 ]}
Average 1-Month Realized Volatility (% Annualized)

Institutional Demand for Hard Assets ^{[ 2 ]}
Appetite to Invest More Capital in Real Estate in the Next Twelve Months (% of investors)

Hard assets can provide diversification

Private real estate and infrastructure have historically exhibited low correlation to most public asset classes. For investors seeking diversification, these assets can help strengthen portfolio resilience.

Correlations
Last 20 Years (2005-2025) ^{[ 3 ]}

Building resilience: hard assets complement stocks and bonds

Allocating to private real estate and infrastructure has historically improved portfolio outcomes by enhancing return potential while reducing volatility relative to traditional stock and bond allocations —supporting stronger risk-adjusted returns over time.

Risk-Return
Last 20 Years (2005-2025) ^{[ 4 ]}

Hard assets are the backbone of today’s investment megatrends

Megatrends are reshaping how the economy operates—but their impact across hard assets is not uniform.

Infrastructure enables structural growth, supporting the power, data, and transportation systems required as demand for connectivity, energy, and mobility continues to rise—shaped by a global push toward resilience and domestic capacity.
Real estate reflects where demand materializes across the economy, with growth concentrated in sectors linked to data centers, logistics, and manufacturing, while housing remains more influenced by demographic trends rather than structural disruption.
In some areas, the two overlap—particularly where assets support digital infrastructure and industrial activity.

In our view, these asset classes play distinct and complementary roles within a diversified hard -asset allocation.

high conviction themes

Private Real Estate

Data Centers

New development, stabilized

Industrial

Logistics, manufacturing

Rental Housing

Multifamily, student housing

Private Infrastructure

Digital

Data center, cell towers, fiber

Energy

Generation, transmission, grid

Transportation

Ports, rail, roads, airports, marinas

The opportunity set is predominantly private

Hard assets are primarily accessed through private markets. US commercial real estate is an approximately $22 trillion market, over 90% of which is privately held.

Infrastructure represents another significant opportunity. An estimated $106 trillion of global investment is required through 2040 to support rising demand for data, power, and transportation —far exceeding the current base of private infrastructure assets.

US Commercial Real Estate Market ^{[ 5 ]}

Sizing the Infrastructure Opportunity ^{[ 6 ]}
Private Infrastructure AUM

sizing_the_infrastructure_opportunity_white_bg_desktop_780x585

Manager selection matters

In private markets, outcomes are highly dependent on manager selection. Historically, performance dispersion between top- and bottom-quartile managers has been significantly wider than in public markets—placing a premium on thematic conviction, scale, and execution.

Dispersion of Fund Manager Performance Over a 10 Year Period ^{[ 7 ]}

Blackstone has invested in private real estate and infrastructure for decades, identifying enduring hard-asset opportunities and deploying capital with discipline across market cycles.

In our view, today’s environment presents a compelling opportunity across these markets, as infrastructure demand continues to expand and real estate fundamentals improve.

Important Disclosure Information

This commentary does not constitute an offer to sell any securities or the solicitation of an offer to purchase any securities. This commentary discusses broad market, industry or sector trends, or other general economic, market or political conditions and has not been provided in a fiduciary capacity under ERISA and should not be construed as research, investment advice, or any investment recommendation. Past performance does not predict future returns.

The views expressed in this commentary are the personal views of the authors and do not necessarily reflect the views of Blackstone. The views expressed reflect the current views of the authors as of the date hereof, and neither the authors nor Blackstone undertake any responsibility to advise you of any changes in the views expressed herein.

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Forward Looking Statements

This commentary may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect our current views with respect to, among other things, artificial intelligence’s impact and investment opportunities. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “scheduled,” “estimates,” “anticipates,” “opportunity,” “leads,” “forecast,” “possible” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. We believe these factors include but are not limited to those described under the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, as such factors may be updated from time to time in our subsequent filings with the United States Securities and Exchange Commission (“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 report and in our other periodic filings. The forward-looking statements speak only as of the date of this commentary, and we undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Hard Assets in a Changing World

June 11, 2026