8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 21, 2016

The Blackstone Group L.P.

(Exact name of Registrant as specified in its charter)

Delaware	001-33551	20-8875684
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
345 Park Avenue New York, New York		10154
(Address of principal executive offices)		(Zip Code)

(212) 583-5000

(Registrant’s telephone number, including area code)

NOT APPLICABLE

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations.

On April 21, 2016, The Blackstone Group L.P. issued a press release announcing financial results for its first quarter ended March 31, 2016.

The press release is attached hereto as Exhibit 99.1. All information in the press release is furnished but not filed.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Press release of The Blackstone Group L.P. dated April 21, 2016.

i

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 21, 2016

The Blackstone Group L.P.

By: Blackstone Group Management L.L.C.,

       its General Partner

By:	/s/ Michael S. Chae
Name:	Michael S. Chae
Title:	Chief Financial Officer

ii

EX-99.1

Exhibit 99.1

Blackstone Reports First Quarter Results

New York, April 21, 2016: Blackstone (NYSE:BX) today reported its first quarter 2016 results.

Stephen A. Schwarzman, Chairman and Chief Executive Officer, said, “In the first quarter Blackstone reached a record $344 billion in total assets under management, with $80 billion of gross inflows driving 11% year-over-year AUM growth, and $17 billion of gross inflows in the first quarter alone. Global investors continue to turn to the alternatives asset class, and Blackstone in particular, to provide superior long-term investment performance in a challenging and uncertain environment, fueling these trends. Our major drawdown funds again outperformed the relevant indices in the first quarter and, while certain liquid strategies were not immune to the market turbulence in the period, as a firm we’ve never been better positioned for long-term success with our clients around the world.”

Blackstone’s press release of its first quarter 2016 results can also be viewed at www.blackstone.com.

Distribution

Blackstone has declared a quarterly distribution of $0.28 per common unit to record holders of common units at the close of business on May 2, 2016. This distribution will be paid on May 9, 2016.

Quarterly Investor Call Details

Blackstone will host a conference call on April 21, 2016 at 11:00 a.m. ET to discuss first quarter 2016 results. The conference call can be accessed via the Shareholders section of Blackstone’s website at www.blackstone.com or by dialing +1 (877) 391-6747 (U.S. domestic) or +1 (617) 597-9291 (international), pass code 149 943 55#. For those unable to listen to the live broadcast, a replay will be available on www.blackstone.com or by dialing +1 (888) 286-8010 (U.S. domestic) or +1 (617) 801-6888 (international), pass code 204 488 67#.

About Blackstone

Blackstone is one of the world’s leading investment firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, and the communities in which we work. We do this by using extraordinary people and flexible capital to help companies solve problems. Our asset management businesses, with over $340 billion in assets under management, include investment vehicles focused on

The Blackstone Group L.P.

345 Park Avenue

New York, New York 10154

T 212 583 5000

private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds, all on a global basis. Further information is available at www.blackstone.com. Follow Blackstone on Twitter @Blackstone.

Forward-Looking Statements

This release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 which reflect Blackstone’s current views with respect to, among other things, Blackstone’s operations and financial performance. 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,” “estimates,” “anticipates” 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. Blackstone believes these factors include but are not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2015, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange Commission, 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 release and in the filings. Blackstone undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

This release does not constitute an offer of any Blackstone Fund.

Investor and Media Relations Contacts

Joan Solotar Blackstone Tel: +1 (212) 583-5068 solotar@blackstone.com Weston Tucker Blackstone Tel: +1 (212) 583-5231 tucker@blackstone.com Christine Anderson Blackstone Tel: +1 (212) 583-5182 Christine.Anderson@blackstone.com

2

Blackstone’s First Quarter 2016 Earnings

April 21, 2016

Blackstone

1

Blackstone’s First Quarter 2016 Highlights

Economic

Net

Income

(“ENI”)

was

$371

million

($0.31/unit)

in

the

first

quarter,

on

$929

million

of

Total

Segment

Revenues.

•

ENI

was

$899

million

($0.76/unit)

for

the

last

twelve

months

(“LTM”)

on

$3.0

billion

of

Total

Segment

Revenues.

Distributable

Earnings

(“DE”)

was

$388

million

($0.33/

unit)

in

the

first

quarter,

on

$259

million

of

Realized

Performance

Fees.

•

DE

was

$3.0

billion

($2.51/unit)

LTM

on

$2.4

billion

of

Realized

Performance

Fees.

Fee

Related

Earnings

(“FRE”)

was

$219

million

in

the

first

quarter,

up

21%

from

$181

million

in

the

prior

year

despite

the

spin-off

of

Blackstone’s

Advisory

businesses

completed

in

October

2015.

•

FRE

was

$974

million

LTM,

on

$2.6

billion

of

Fee

Revenues.

GAAP

Net

Income

was

$150

million

($0.23/unit

diluted)

for

the

quarter

and

$230

million

($0.28/unit

diluted)

LTM,

net

of

certain

non-cash

IPO

and

transaction

related

expenses

and

net

income

attributable

to

non-controlling

interests,

primarily

inside

ownership.

Total

Assets

Under

Management

(“AUM”)

reached

a

record

$343.7

billion

through

a

combination

of

strong

fundraising

and

organic

expansion.

•

Gross

inflows

were

$17.1

billion

in

the

first

quarter,

bringing

LTM

inflows

to

$80.2

billion.

•

Total

AUM

increased

11%

year-over-year,

despite

returning

$48.2

billion

of

capital

to

investors.

Significant

capital

deployment

of

$6.7

billion

in

the

first

quarter

was

achieved

by

leveraging

Blackstone’s

diverse

platform

to

find

opportunities

globally.

Blackstone

declared

a

first

quarter

distribution

of

$0.28

per

common

unit

payable

on

May

9,

2016.

Blackstone

2

Blackstone’s First Quarter 2016 Segment Earnings

n/m = not meaningful. See page 11 for the GAAP Statement of Operations.

% Change

% Change

(Dollars in Thousands, Except per Unit Data)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Fee Revenues

614,891

$         

606,953

$         

(1)%

2,601,360

$      

2,565,467

$      

(1)%

Performance Fees

1,673,736

314,065

(81)%

5,286,599

438,406

(92)%

Investment Income (Loss)

189,641

(26,650)

n/m

544,802

(163,442)

n/m

Interest Income and Dividend Revenue

30,451

35,081

15%

104,433

136,231

30%

Total Revenues

2,508,719

929,449

(63)%

8,537,194

2,976,662

(65)%

Total Expenses

876,936

542,004

(38)%

3,186,159

2,043,204

(36)%

Taxes

9,719

16,794

73%

197,919

34,602

(83)%

Economic Net Income (“ENI”)

1,622,064

$     

370,651

$         

(77)%

5,153,116

$     

898,856

$         

(83)%

ENI per Unit

1.37

$               

0.31

$               

(77)%

4.43

$               

0.76

$               

(83)%

GAAP Net Income

629,448

$         

150,033

$         

(76)%

1,948,420

$      

230,374

$         

(88)%

Fee Related Earnings (“FRE”)

180,624

$         

219,456

$         

21%

1,008,576

$      

974,443

$         

(3)%

Distributable Earnings (“DE”)

1,240,207

$     

387,967

$         

(69)%

3,825,519

$     

2,991,448

$     

(22)%

DE per Common Unit

1.05

$               

0.33

$               

(69)%

3.16

$               

2.51

$               

(21)%

Total AUM

310,451,289

$ 

343,705,462

$ 

11%

310,451,289

$ 

343,705,462

$ 

11%

Fee-Earning AUM

223,511,700

$ 

244,452,764

$ 

9%

223,511,700

$ 

244,452,764

$ 

9%

Blackstone

3

Private Equity

1.7%

1Q’16 increase in Corporate

Private Equity carrying value

$3.5

billion

1Q’16 capital raised

$95.5

billion

Total AUM up 25% YoY

Corporate

Private

Equity

carrying

value

increased

1.7%

in

the

quarter

driven

by

public

portfolio

appreciation.

Realizations

through

public

and

strategic

sales

were

$2.1

billion

in

the

first

quarter

and

$12.3

billion

over

the

LTM.

Deployed

$2.0

billion

during

the

quarter

including

the

closing

of

several

new

investments

and

synergistic

add-on

investments

to

existing

platform

deals.

Raised

$3.5

billion

in

the

quarter

across

the

segment,

including

initial

closings

for

the

seventh

secondary

fund

and

the

Core

Private

Equity

fund,

bringing

total

capital

raised

to

$30.3

billion

over

the

last

twelve

months.

Total

AUM

increased

25%

year-over-year

to

a

record

$95.5

billion,

driven

by

fundraising

across

flagship

funds,

Strategic

Partners,

Tactical

Opportunities

and

Core

Private

Equity.

% Change

% Change

(Dollars in Thousands)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Fee Revenues

124,397

$       

131,133

$       

5%

542,358

$      

525,289

$      

(3)%

Performance Fees

949,800

104,157

(89)%

2,640,160

(88,611)

n/m

Investment Income (Loss)

76,303

83

(100)%

203,606

(2,909)

n/m

Interest Income and Dividend Revenue

7,618

9,849

29%

24,381

35,449

45%

Total Revenues

1,158,118

245,222

(79)%

3,410,505

469,218

(86)%

Compensation

71,072

80,274

13%

277,450

289,450

4%

Performance Fee Compensation

217,602

24,723

(89)%

635,818

53,871

(92)%

Other Operating Expenses

38,875

48,063

24%

149,240

208,346

40%

Total Expenses

327,549

153,060

(53)%

1,062,508

551,667

(48)%

Economic Income (Loss)

830,569

$      

92,162

$         

(89)%

2,347,997

$   

(82,449)

$       

n/m

Total AUM

76,327,189

$ 

95,466,227

$ 

25%

76,327,189

$ 

95,466,227

$ 

25%

Fee-Earning AUM

49,342,211

$ 

50,228,312

$ 

2%

49,342,211

$ 

50,228,312

$ 

2%

Blackstone

4

Real Estate

Opportunistic

funds’

carrying

value

was

up

1.8%

during

the

quarter

due

to

gains

across

public

and

private

investment

values;

core+

funds’

carrying

value

was

up

4.4%

in

the

quarter.

Investment

pace

remained

strong

with

$3.8

billion

invested

in

the

quarter,

including

the

closing

of

the

BioMed

Realty

acquisition,

a

publicly

traded

U.S.

life

sciences

office

REIT.

Sustained

strong

level

of

realizations

with

$3.5

billion

in

the

quarter

through

both

Blackstone’s

public

stake

in

Gecina

and

private

sales,

including

asset

sales

within

the

Equity

Office

Properties

and

Trizec

office

portfolios.

Total

AUM

up

9%

year-over-year

and

up

more

than

27%

since

the

beginning

of

2014

to

over

$100

billion

despite

$44.2

billion

of

capital

returned

to

investors

in

the

same

period.

•

Fee-Earning

AUM

up

33%

year-over-year

to

$67.3

billion

driven

by

increases

in

scale

of

opportunistic

funds

and

growth

of

the

core+

strategy.

Raised

$8.4

billion

in

the

quarter,

including

$5.2

billion

for

the

first

closing

of

the

fifth

European

opportunistic

fund

and

$1.7

billion

for

the

third

mezzanine

debt

fund.

1.8%

$205

million

1Q’16 Realized Performance Fees

$101.1

billion

Total AUM up 9% YoY

% Change

% Change

(Dollars in Thousands)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Fee Revenues

158,721

$       

230,197

$          

45%

683,260

$      

822,366

$          

20%

Performance Fees

637,022

202,939

(68)%

2,317,202

558,063

(76)%

Investment Income (Loss)

108,854

10,838

(90)%

322,283

(94,323)

n/m

Interest Income and Dividend Revenue

9,997

13,188

32%

34,084

47,181

38%

Total Revenues

914,594

457,162

(50)%

3,356,829

1,333,287

(60)%

Compensation

84,834

100,578

19%

330,918

374,125

13%

Performance Fee Compensation

151,343

77,070

(49)%

674,558

230,912

(66)%

Other Operating Expenses

40,143

48,097

20%

153,119

187,129

22%

Total Expenses

276,320

225,745

(18)%

1,158,595

792,166

(32)%

Economic Income

638,274

$      

231,417

$         

(64)%

2,198,234

$   

541,121

$         

(75)%

Total AUM

92,785,658

$ 

101,107,528

$  

9%

92,785,658

$ 

101,107,528

$  

9%

Fee-Earning AUM

50,783,247

$ 

67,298,439

$    

33%

50,783,247

$ 

67,298,439

$    

33%

1Q’16 increase in opportunistic 

funds’ carrying value

Blackstone

5

Hedge Fund Solutions

(2.9)%

1Q’16 Composite Gross Return

$35.4

billion

Incentive Fee Eligible AUM at 1Q’16

$2.9

billion

1Q’16 Fee-Earning Gross Inflows

The

composite

gross

return

was

down

2.9%

in

the

quarter

on

challenging

market

conditions.

Fee-Earning

gross

inflows

of

$2.9

billion

during

the

quarter

and

$9.4

billion

LTM

were

driven

by

customized

and

commingled

strategies

and

individual

investor

solutions.

•

April

1

subscriptions

of

$205

million

are

not

yet

included

in

Fee-Earning

AUM.

Total

AUM

up

3%

year-over-year

to

$68.5

billion

driven

by

continued

platform

diversification

and

growth

in

customized

strategies

and

individual

investor

solutions.

•

Total

AUM

net

inflows

of

$1.4

billion

during

the

quarter

and

$4.5

billion

LTM

reflect

continued

investor

confidence

in

BAAM’s

ability

to

identify

strategic

opportunities

while

managing

risk.

•

Total

AUM

for

BAAM’s

individual

investor

solutions

platform

reached

$6.8

billion,

up

79%

from

$3.8

billion

year-over-year.

% Change

% Change

(Dollars in Thousands)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Fee Revenues

128,775

$       

129,313

$       

0%

497,022

$      

525,612

$      

6%

Performance Fees

57,943

(219)

n/m

139,663

3,972

(97)%

Investment Income (Loss)

(5,892)

(17,036)

189%

(461)

(25,320)

n/m

Interest Income and Dividend Revenue

3,949

5,296

34%

12,402

18,621

50%

Total Revenues

184,775

117,354

(36)%

648,626

522,885

(19)%

Compensation

56,104

54,169

(3)%

147,191

177,549

21%

Performance Fee Compensation

19,121

668

(97)%

41,267

6,613

(84)%

Other Operating Expenses

21,206

26,146

23%

87,855

95,012

8%

Total Expenses

96,431

80,983

(16)%

276,313

279,174

1%

Economic Income

88,344

$         

36,371

$         

(59)%

372,313

$      

243,711

$      

(35)%

Total AUM

66,378,908

$ 

68,475,416

$ 

3%

66,378,908

$ 

68,475,416

$ 

3%

Fee-Earning AUM

64,114,498

$ 

64,831,253

$ 

1%

64,114,498

$ 

64,831,253

$ 

1%

The composite gross return is based on the BAAM Principal Solutions (“BPS”) Composite, which does not include BAAM’s individual investor solutions (liquid alternatives), long-biased

commodities, ventures (seeding and minority interests), strategic opportunities (co-investments), Senfina (direct trading) and advisory (non-discretionary) platforms, except for 

investments by BPS funds directly into those platforms. BAAM-managed funds in liquidation are also excluded. On a net of fees basis, the BPS Composite was (3.1)% for 1Q’16. 

Blackstone

6

Credit

Credit

markets

continued

to

experience

significant

volatility,

creating

investment

opportunities

as

$569

million

of

capital

was

deployed

during

the

quarter,

with

significant

investment

activity

from

rescue

lending

strategies.

Performance

across

the

Distressed

and

Performing

Credit

Strategies

was

negatively

impacted

by

energy

investments.

Given

significant

dislocation

in

the

market

there

continues

to

be

a

robust

deal

pipeline

for

our

rescue

lending

and

mezzanine

strategies.

Fee-Earning

AUM

growth

of

5%

year-over-year

driven

by

capital

deployed

in

drawdown

funds

and

growth

across

the

BDC

platform.

Continued

realization

activity

across

funds

of

$885

million

in

the

quarter

and

$7.2

billion

LTM,

primarily

in

drawdown

funds

and

the

CLO

platform.

$569

million

1Q’16 Total Capital Deployed

$78.7

billion

Total AUM up 5% YoY

1Q’16 Composite Gross Returns

Performing Credit

0.6%

Distressed

(3.3)%

% Change

% Change

(Dollars in Thousands)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Fee Revenues

122,129

$       

116,310

$       

(5)%

465,610

$      

476,640

$      

2%

Performance Fees

28,971

7,188

(75)%

189,574

(35,018)

n/m

Investment Income (Loss)

9,124

(20,535)

n/m

17,383

(38,731)

n/m

Interest Income and Dividend Revenue

5,651

6,748

19%

22,830

25,696

13%

Total Revenues

165,875

109,711

(34)%

695,397

428,587

(38)%

Compensation

49,877

52,382

5%

187,325

192,694

3%

Performance Fee Compensation

15,750

3,614

(77)%

100,422

(24,577)

n/m

Other Operating Expenses

21,836

26,220

20%

79,521

98,010

23%

Total Expenses

87,463

82,216

(6)%

367,268

266,127

(28)%

Economic Income

78,412

$         

27,495

$         

(65)%

328,129

$      

162,460

$      

(50)%

Total AUM

74,959,534

$ 

78,656,291

$ 

5%

74,959,534

$ 

78,656,291

$ 

5%

Fee-Earning AUM

59,271,744

$ 

62,094,760

$ 

5%

59,271,744

$ 

62,094,760

$ 

5%

Performing Credit Strategies include mezzanine lending funds, Business Development Companies (“BDCs”) and other performing credit strategy funds. Distressed Strategies include hedge fund strategies,

rescue lending funds and distressed energy strategies. The composite gross returns represent a weighted-average composite of the fee-earning funds exceeding $100 million of fair value at each respective

quarter end for each strategy. Composite gross returns exclude the Blackstone Funds that were contributed to GSO as part of Blackstone’s acquisition of GSO in March 2008. Performing Credit Strategies’ net

returns were (0.4)% for 1Q'16 and Distressed Strategies’ net returns were (3.9)% for 1Q'16. The breakdown of Total AUM for 1Q’16 is as follows: Distressed Strategies $20.7 billion (34% Incentive Fee,

66% Carried Interest), Performing Credit Strategies $27.3 billion (61% Incentive Fee, 39% Carried Interest), and Long Only $30.7 billion.

Blackstone

7

$66.0

$75.0

$78.7

$58.3

$66.4

$68.5

$81.3

$92.8

$101.1

$66.1

$76.3

$95.5

1Q'14

1Q'15

1Q'16

Fee-Earning AUM by Segment

(Dollars in Billions)

Total AUM by Segment

(Dollars in Billions)

$271.7

Private Equity

Real Estate

Hedge Fund Solutions

Credit

Total AUM increased 11% year-over-year to $343.7 billion driven by $80.2 billion from gross inflows.

•

Each segment experienced growth despite $48.2 billion of capital returned to investors during the year.

•

Real Estate ended the quarter with $101.1 billion Total AUM, making it Blackstone’s first segment to surpass

the $100

billion threshold.

Fee-Earning AUM of $244.5 billion was up 9% year-over-year as $59.8 billion of gross inflows significantly

outpaced $35.7 billion of realizations and outflows.

Assets Under Management

$53.4

$59.3

$62.1

$55.6

$64.1

$64.8

$53.5

$50.8

$67.3

$41.2

$49.3

$50.2

1Q'14

1Q'15

1Q'16

$310.5

$343.7

$203.6

$223.5

$244.5

Blackstone

8

$11.5

$14.5

$25.1

$116.0

$150.8

$121.4

$25.3

$13.9

$50.4

$44.5

$60.6

$85.6

1Q'14

1Q'15

1Q'16

Additional Capital Detail

Undrawn

capital

(“Total

Dry

Powder”)

was

$88.6

billion,

up

37%

year-over-year,

driven

by

recent

fundraises

for

the

latest

global

private

equity

and

real

estate

funds.

Performance

Fee

Eligible

AUM

reached

$257.4

billion

at

quarter

end,

up

14%

year-over-year,

despite

significant

realizations

in

the

Real

Estate

and

Private

Equity

segments.

•

Consistently

strong

fundraising

drove

a

41%

year-over-year

increase

in

Performance

Fee

Eligible

assets

not

yet

invested

to

$85.6

billion.

Uninvested

Not Currently

Earning

Performance

Fees

Currently

Earning

Performance

Fees

Private Equity

Real Estate

Hedge Fund Solutions

Credit

$89 billion 1Q’16

Total Dry Powder

$257 billion Performance

Fee Eligible AUM

$53 billion Not Currently

Earning Management Fees

$225.4

$257.4

$185.8

Credit

Hedge Fund

Solutions

Real Estate

Private Equity

$52.8

$39.0

$31.2

$4.1

$14.2

Blackstone

9

$3.11

$4.17

$2.70

$2.42

$2.09

$1.89

$1.67

$2.68

$2.80

1Q'14

1Q'15

1Q'16

At

March

31,

2016,

Blackstone

had

$3.3

billion

in

total

cash

and

corporate

treasury

investments

and

$8.8

billion

of

total

net

value,

or

$7.39

per

unit.

Blackstone

has

no

net

debt,

a

$1.1

billion

undrawn

credit

revolver

and

maintained

A+/A+

ratings.

Balance Sheet Highlights

Balance Sheet Highlights are preliminary, and exclude the consolidated Blackstone funds. Investments include Blackstone investments in Private Equity, Real Estate, Hedge Fund

Solutions,

and

Credit,

which

were

$793

million,

$1.1

billion,

$128

million,

and

$260

million,

respectively,

as

of

March

31,

2016,

$1.0

billion,

$1.3

billion,

$131

million,

and

$239

million,

respectively,

as

of

March

31,

2015

and

$1.1

billion,

$1.5

billion,

$118

million,

and

$253

million,

respectively,

as

of

March

31,

2014.

Cash

and

Investments

per

unit

amounts

are

calculated using period end DE Units Outstanding (see page 29, Unit Rollforward).

(Dollars in Millions)

1Q’16

Cash and Cash Equivalents

$

1,373

Treasury Cash

Management Strategies

1,954

Investments

2,243

Net Accrued Performance

Fees

3,212

Total Net Value

$

8,782

Outstanding

Bonds (at par)

$

2,825

A+/A+

rated by S&P and Fitch

$1.1 billion

undrawn credit revolver with

May 2019 maturity

$3.3 billion

total cash and

corporate treasury

Net

Performance

Fees

Total Cash

and Corporate

Treasury

Investments

$7.39

$8.94

$7.20

Cash and Investments

(Per Unit)

Blackstone

10

$458

$1,483

$754

$201

$797

$889

1Q'14 LTM

1Q'15 LTM

1Q'16 LTM

$246

$2,424

$2,648

$2,127

$820

$2,027

$1,000

1Q'14

1Q'15

1Q'16

Net

Accrued

Performance

Fees

were

$3.2

billion

($2.70/unit)

despite

high

Net

Realized

Performance

Fees

of

$1.8

billion

over

the

last

twelve

months.

•

Realized

36%

of

the

$4.9

billion

Net

Accrued

Performance

Fees

balance

from

one

year

prior.

Performance Fees

Net Realized Performance Fees

(Dollars in Millions)

$2,505

$1,775

$956

Net Accrued Performance Fees

(Dollars in Millions)

$4,910

$3,212

$3,546

Private Equity

Real Estate

Credit

Hedge Fund Solutions

$3.2

billion

Net Accrued Performance Fees

56%

Net Accrued

Performance Fees

Related to Publics/Pending Exits

$1.8 billion

1Q’16 LTM Net Realized

Performance Fees

Net Accrued Performance Fees per unit is calculated using period end DE Units Outstanding (see page 29, Unit Rollforward).

Blackstone

11

GAAP Statement of Operations

% Change

% Change

(Dollars in Thousands, Except per Unit Data) (Unaudited)

1Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Revenues

Management and Advisory Fees, Net

616,768

$           

608,906

$           

(1)%

2,540,860

$       

2,534,643

$       

(0)%

Performance Fees

Realized Carried Interest

1,207,594

230,909

(81)%

3,324,053

2,228,605

(33)%

Realized Incentive Fees

29,638

28,419

(4)%

234,849

192,019

(18)%

Unrealized Carried Interest

373,840

47,586

(87)%

1,748,370

(1,921,428)

n/m

Unrealized Incentive Fees

62,036

7,579

(88)%

(31,946)

(61,145)

91%

Total Performance Fees

1,673,108

314,493

(81)%

5,275,326

438,051

(92)%

Investment Income (Loss)

Realized

187,930

(12,001)

n/m

558,639

355,240

(36)%

Unrealized

18,273

3,493

(81)%

15,038

(365,309)

n/m

Total Investment Income (Loss)

206,203

(8,508)

n/m

573,677

(10,069)

n/m

Interest and Dividend Revenue

21,920

23,075

5%

77,660

96,112

24%

Other

(5,641)

(5,612)

(1)%

2,895

7,811

170%

Total Revenues

2,512,358

932,354

(63)%

8,470,418

3,066,548

(64)%

Expenses

Compensation and Benefits

Compensation

559,559

346,003

(38)%

1,943,076

1,512,635

(22)%

Performance Fee Compensation

Realized Carried Interest

292,248

58,504

(80)%

958,493

560,057

(42)%

Realized Incentive Fees

12,227

14,124

16%

98,691

87,842

(11)%

Unrealized Carried Interest

74,380

30,001

(60)%

412,687

(357,075)

n/m

Unrealized Incentive Fees

24,961

3,448

(86)%

(17,846)

(24,003)

35%

Total Compensation and Benefits

963,375

452,080

(53)%

3,395,101

1,779,456

(48)%

General, Administrative and Other

130,973

123,045

(6)%

544,882

568,175

4%

Interest Expense

31,370

37,356

19%

128,227

150,508

17%

Fund Expenses

16,850

5,229

(69)%

42,363

67,878

60%

Total Expenses

1,142,568

617,710

(46)%

4,110,573

2,566,017

(38)%

Other Income

Reversal of Tax Receivable Agreement Liability

-

-

n/m

-

82,707

n/m

Net Gains from Fund Investment Activities

93,555

19,142

(80)%

381,254

101,951

(73)%

Income Before Provision for Taxes

1,463,345

$       

333,786

$          

(77)%

4,741,099

$       

685,189

$          

(86)%

Provision for Taxes

99,344

18,866

(81)%

336,420

109,920

(67)%

Net Income

1,364,001

$       

314,920

$          

(77)%

4,404,679

$       

575,269

$          

(87)%

Net Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated  Entities

7,527

(6,401)

n/m

36,529

(2,783)

n/m

Net Income Attributable to Non-Controlling Interests in Consolidated Entities

81,796

40,086

(51)%

372,905

178,190

(52)%

Net Income Attributable to Non-Controlling Interests in Blackstone Holdings

645,230

131,202

(80)%

2,046,825

169,488

(92)%

Net Income Attributable to The Blackstone Group L.P. ("BX")

629,448

$          

150,033

$          

(76)%

1,948,420

$       

230,374

$          

(88)%

Net Income per Common Unit, Basic

1.01

$                 

0.23

$                 

(77)%

3.17

$                 

0.36

$                 

(89)%

Net Income per Common Unit, Diluted

1.00

$                 

0.23

$                 

(77)%

3.14

$                 

0.28

$                 

(91)%

Appendix

Blackstone

13

Total Segments

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Management and Advisory Fees, Net

Base Management Fees

516,397

$              

516,492

$              

564,287

$              

599,407

$              

586,703

$              

2,027,048

$           

2,266,889

$           

Advisory Fees

84,238

76,998

146,153

742

481

435,120

224,374

Transaction and Other Fees, Net

37,073

11,728

32,403

72,481

46,118

223,600

162,730

Management Fee Offsets

(17,945)

(18,434)

(34,176)

(22,939)

(20,101)

(88,072)

(95,650)

Total Management and Advisory Fees, Net

619,763

586,784

708,667

649,691

613,201

2,597,696

2,558,343

Performance Fees

Realized Carried Interest

1,207,594

937,483

435,189

625,610

230,909

3,324,567

2,229,191

Realized Incentive Fees

29,670

47,819

34,785

82,472

28,450

237,578

193,526

Unrealized Carried Interest

373,852

(441,949)

(1,055,977)

(471,222)

47,606

1,752,525

(1,921,542)

Unrealized Incentive Fees

62,620

26,311

(53,346)

(42,834)

7,100

(28,071)

(62,769)

Total Performance Fees

1,673,736

569,664

(639,349)

194,026

314,065

5,286,599

438,406

Investment Income (Loss)

Realized

107,792

136,497

87,526

86,993

(10,101)

539,300

300,915

Unrealized

81,849

(125,723)

(223,657)

(98,428)

(16,549)

5,502

(464,357)

Total Investment Income (Loss)

189,641

10,774

(136,131)

(11,435)

(26,650)

544,802

(163,442)

Interest Income and Dividend Revenue

30,451

31,026

35,459

34,665

35,081

104,433

136,231

Other

(4,872)

3,973

(841)

10,240

(6,248)

3,664

7,124

Total Revenues

2,508,719

1,202,221

(32,195)

877,187

929,449

8,537,194

2,976,662

Expenses

Compensation

329,838

289,352

329,575

240,454

287,403

1,176,804

1,146,784

Performance Fee Compensation

Realized Carried Interest

292,248

238,032

97,799

165,721

58,503

958,493

560,055

Realized Incentive Fees

12,227

21,837

15,061

36,821

14,123

98,691

87,842

Unrealized Carried Interest

74,380

(50,559)

(228,697)

(107,820)

30,001

412,727

(357,075)

Unrealized Incentive Fees

24,961

6,131

(14,642)

(18,940)

3,448

(17,846)

(24,003)

Total Compensation and Benefits

733,654

504,793

199,096

316,236

393,478

2,628,869

1,413,603

Other Operating Expenses

143,282

168,401

157,565

155,109

148,526

557,290

629,601

Total Expenses

876,936

673,194

356,661

471,345

542,004

3,186,159

2,043,204

Economic Income (Loss)

1,631,783

$          

529,027

$              

(388,856)

$            

405,842

$              

387,445

$              

5,351,035

$          

933,458

$              

Economic Net Income (Loss)

1,622,064

$          

508,440

$              

(415,926)

$            

435,691

$              

370,651

$              

5,153,116

$          

898,856

$              

Fee Related Earnings

180,624

$              

178,441

$              

265,667

$              

310,879

$              

219,456

$              

1,008,576

$          

974,443

$              

Distributable Earnings

1,240,207

$          

1,033,920

$          

691,534

$              

878,027

$              

387,967

$              

3,825,519

$          

2,991,448

$          

Total Assets Under Management

310,451,289

$      

332,723,546

$      

333,925,521

$      

336,384,575

$      

343,705,462

$      

310,451,289

$      

343,705,462

$      

Fee-Earning Assets Under Management

223,511,700

$      

239,342,214

$      

240,939,356

$      

246,146,372

$      

244,452,764

$      

223,511,700

$      

244,452,764

$      

Weighted Average Fee-Earning AUM

218,241,987

$      

237,576,488

$      

239,786,680

$      

242,942,380

$      

244,891,488

$      

216,244,401

$      

251,213,289

$      

LP Capital Invested

4,765,536

$           

4,814,362

$           

6,145,446

$           

14,779,702

$        

6,515,571

$           

24,666,510

$        

32,255,081

$        

Total Capital Invested

5,052,370

$           

5,048,058

$           

6,507,371

$           

15,747,511

$        

6,693,375

$           

26,620,667

$        

33,996,315

$        

Blackstone

14

Private Equity

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Management Fees, Net

Base Management Fees

108,383

$              

121,918

$              

128,452

$              

143,887

$              

130,648

$              

425,640

$              

524,905

$              

Advisory Fees

2,429

4,843

2,547

742

481

21,990

8,613

Transaction and Other Fees, Net

20,359

(11,842)

9,359

18,382

8,439

113,230

24,338

Management Fee Offsets

(4,949)

(9,028)

(12,262)

(10,521)

(6,848)

(22,382)

(38,659)

Total Management Fees, Net

126,222

105,891

128,096

152,490

132,720

538,478

519,197

Performance Fees

Realized Carried Interest

382,978

546,575

214,532

330,902

30,282

1,017,575

1,122,291

Unrealized Carried Interest

566,822

(305,573)

(809,363)

(169,841)

73,875

1,622,585

(1,210,902)

Total Performance Fees

949,800

241,002

(594,831)

161,061

104,157

2,640,160

(88,611)

Investment Income (Loss)

Realized

44,816

50,258

46,917

47,658

(15,357)

187,000

129,476

Unrealized

31,487

(22,301)

(110,689)

(14,835)

15,440

16,606

(132,385)

Total Investment Income (Loss)

76,303

27,957

(63,772)

32,823

83

203,606

(2,909)

Interest Income and Dividend Revenue

7,618

7,669

8,119

9,812

9,849

24,381

35,449

Other

(1,825)

2,515

471

4,693

(1,587)

3,880

6,092

Total Revenues

1,158,118

385,034

(521,917)

360,879

245,222

3,410,505

469,218

Expenses

Compensation

71,072

68,106

70,419

70,651

80,274

277,450

289,450

Performance Fee Compensation

Realized Carried Interest

39,482

106,502

16,303

94,635

15,427

220,104

232,867

Unrealized Carried Interest

178,120

(25,574)

(141,448)

(21,270)

9,296

415,714

(178,996)

Total Compensation and Benefits

288,674

149,034

(54,726)

144,016

104,997

913,268

343,321

Other Operating Expenses

38,875

62,571

43,812

53,900

48,063

149,240

208,346

Total Expenses

327,549

211,605

(10,914)

197,916

153,060

1,062,508

551,667

Economic Income (Loss)

830,569

$              

173,429

$              

(511,003)

$            

162,963

$              

92,162

$                

2,347,997

$          

(82,449)

$               

Total Assets Under Management

76,327,189

$        

92,026,337

$        

91,490,669

$        

94,280,074

$        

95,466,227

$        

76,327,189

$        

95,466,227

$        

Fee-Earning Assets Under Management

49,342,211

$        

49,537,189

$        

50,560,404

$        

51,451,196

$        

50,228,312

$        

49,342,211

$        

50,228,312

$        

Weighted Average Fee-Earning AUM

45,051,839

$        

49,925,744

$        

50,268,174

$        

51,185,170

$        

51,240,819

$        

46,107,237

$        

52,093,539

$        

LP Capital Invested

2,374,599

$           

1,800,854

$           

1,535,702

$           

4,508,023

$           

1,865,698

$           

9,968,853

$           

9,710,277

$           

Total Capital Invested

2,517,769

$           

1,949,748

$           

1,677,876

$           

5,270,078

$           

1,974,391

$           

11,443,494

$        

10,872,093

$        

Blackstone

15

Real Estate

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Management Fees, Net

Base Management Fees

152,348

$              

140,743

$              

175,710

$              

199,774

$              

199,907

$              

621,514

$              

716,134

$              

Transaction and Other Fees, Net

15,216

21,510

21,390

52,461

35,794

93,262

131,155

Management Fee Offsets

(4,866)

(5,428)

(10,147)

(6,399)

(3,595)

(30,085)

(25,569)

Total Management Fees, Net

162,698

156,825

186,953

245,836

232,106

684,691

821,720

Performance Fees

Realized Carried Interest

811,249

363,983

169,051

290,450

200,627

2,104,353

1,024,111

Realized Incentive Fees

723

1,220

3,879

11,331

4,069

12,248

20,499

Unrealized Carried Interest

(181,019)

(188,608)

(128,854)

(182,061)

(11,522)

202,790

(511,045)

Unrealized Incentive Fees

6,069

3,935

2,784

8,014

9,765

(2,189)

24,498

Total Performance Fees

637,022

180,530

46,860

127,734

202,939

2,317,202

558,063

Investment Income (Loss)

Realized

71,344

85,432

39,821

38,985

12,975

349,082

177,213

Unrealized

37,510

(107,691)

(95,382)

(66,326)

(2,137)

(26,799)

(271,536)

Total Investment Income (Loss)

108,854

(22,259)

(55,561)

(27,341)

10,838

322,283

(94,323)

Interest Income and Dividend Revenue

9,997

10,259

11,057

12,677

13,188

34,084

47,181

Other

(3,977)

1,077

(938)

2,416

(1,909)

(1,431)

646

Total Revenues

914,594

326,432

188,371

361,322

457,162

3,356,829

1,333,287

Expenses

Compensation

84,834

79,484

99,255

94,808

100,578

330,918

374,125

Performance Fee Compensation

Realized Carried Interest

246,496

116,168

52,546

68,827

43,076

627,659

280,617

Realized Incentive Fees

356

671

1,838

5,813

2,133

6,352

10,455

Unrealized Carried Interest

(98,084)

(50,559)

(23,018)

(24,686)

27,703

42,105

(70,560)

Unrealized Incentive Fees

2,575

230

5,215

797

4,158

(1,558)

10,400

Total Compensation and Benefits

236,177

145,994

135,836

145,559

177,648

1,005,476

605,037

Other Operating Expenses

40,143

43,346

42,050

53,636

48,097

153,119

187,129

Total Expenses

276,320

189,340

177,886

199,195

225,745

1,158,595

792,166

Economic Income

638,274

$              

137,092

$              

10,485

$                

162,127

$              

231,417

$              

2,198,234

$          

541,121

$              

Total Assets Under Management

92,785,658

$        

91,578,634

$        

93,187,556

$        

93,917,824

$        

101,107,528

$      

92,785,658

$        

101,107,528

$      

Fee-Earning Assets Under Management

50,783,247

$        

62,683,857

$        

64,858,622

$        

67,345,357

$        

67,298,439

$        

50,783,247

$        

67,298,439

$        

Weighted Average Fee-Earning AUM

51,671,739

$        

60,939,868

$        

63,492,663

$        

65,356,567

$        

66,943,268

$        

53,085,887

$        

72,387,238

$        

LP Capital Invested

1,443,163

$           

2,963,609

$           

4,118,952

$           

7,733,638

$           

3,747,181

$           

10,986,073

$        

18,563,380

$        

Total Capital Invested

1,405,603

$           

3,035,837

$           

4,326,151

$           

7,835,881

$           

3,820,460

$           

11,189,295

$        

19,018,329

$        

Blackstone

16

Hedge Fund Solutions

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Management Fees, Net

Base Management Fees

130,637

$              

130,216

$              

133,592

$              

129,941

$              

130,158

$              

500,234

$              

523,907

$              

Transaction and Other Fees, Net

25

-

219

73

543

501

835

Management Fee Offsets

(280)

(608)

(507)

1,566

-

(3,839)

451

Total Management Fees, Net

130,382

129,608

133,304

131,580

130,701

496,896

525,193

Performance Fees

Realized Incentive Fees

10,516

16,915

2,783

37,983

2,684

111,200

60,365

Unrealized Carried Interest

-

8,014

(5,394)

(599)

32

-

2,053

Unrealized Incentive Fees

47,427

15,855

(29,711)

(41,655)

(2,935)

28,463

(58,446)

Total Performance Fees

57,943

40,784

(32,322)

(4,271)

(219)

139,663

3,972

Investment Income (Loss)

Realized

(10,375)

(1,757)

(468)

(141)

(4,745)

(5,645)

(7,111)

Unrealized

4,483

2,032

(6,411)

(1,539)

(12,291)

5,184

(18,209)

Total Investment Income (Loss)

(5,892)

275

(6,879)

(1,680)

(17,036)

(461)

(25,320)

Interest Income and Dividend Revenue

3,949

3,970

4,136

5,219

5,296

12,402

18,621

Other

(1,607)

459

(66)

1,414

(1,388)

126

419

Total Revenues

184,775

175,096

98,173

132,262

117,354

648,626

522,885

Expenses

Compensation

56,104

45,841

44,408

33,131

54,169

147,191

177,549

Performance Fee Compensation

Realized Incentive Fees

3,470

8,711

(436)

15,410

1,863

32,650

25,548

Unrealized Carried Interest

-

4,077

(3,041)

(213)

-

-

823

Unrealized Incentive Fees

15,651

3,764

(7,011)

(15,316)

(1,195)

8,617

(19,758)

Total Compensation and Benefits

75,225

62,393

33,920

33,012

54,837

188,458

184,162

Other Operating Expenses

21,206

20,499

24,147

24,220

26,146

87,855

95,012

Total Expenses

96,431

82,892

58,067

57,232

80,983

276,313

279,174

Economic Income

88,344

$                

92,204

$                

40,106

$                

75,030

$                

36,371

$                

372,313

$              

243,711

$              

Total Assets Under Management

66,378,908

$        

67,829,866

$        

68,405,948

$        

69,105,425

$        

68,475,416

$        

66,378,908

$        

68,475,416

$        

Fee-Earning Assets Under Management

64,114,498

$        

65,512,170

$        

65,182,338

$        

65,665,439

$        

64,831,253

$        

64,114,498

$        

64,831,253

$        

Weighted Average Fee-Earning AUM

62,910,553

$        

65,453,883

$        

65,782,066

$        

65,802,335

$        

65,123,126

$        

59,945,488

$        

65,763,940

$        

LP Capital Invested

133,351

$              

2,131

$                  

66,427

$                

41,332

$                

315,757

$              

820,309

$              

425,647

$              

Total Capital Invested

139,223

$              

2,136

$                  

71,132

$                

39,877

$                

329,793

$              

835,106

$              

442,938

$              

Blackstone

17

Credit

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Management Fees, Net

Base Management Fees

125,029

$              

123,615

$              

126,533

$              

125,805

$              

125,990

$              

479,660

$              

501,943

$              

Transaction and Other Fees, Net

1,457

2,060

1,289

1,565

1,342

16,274

6,256

Management Fee Offsets

(7,850)

(3,370)

(11,260)

(7,585)

(9,658)

(31,766)

(31,873)

Total Management Fees, Net

118,636

122,305

116,562

119,785

117,674

464,168

476,326

Performance Fees

Realized Carried Interest

13,367

26,925

51,606

4,258

-

202,639

82,789

Realized Incentive Fees

18,431

29,684

28,123

33,158

21,697

114,130

112,662

Unrealized Carried Interest

(11,951)

44,218

(112,366)

(118,721)

(14,779)

(72,850)

(201,648)

Unrealized Incentive Fees

9,124

6,521

(26,419)

(9,193)

270

(54,345)

(28,821)

Total Performance Fees

28,971

107,348

(59,056)

(90,498)

7,188

189,574

(35,018)

Investment Income (Loss)

Realized

2,237

2,723

1,735

491

(2,974)

8,520

1,975

Unrealized

6,887

2,760

(10,177)

(15,728)

(17,561)

8,863

(40,706)

Total Investment Income (Loss)

9,124

5,483

(8,442)

(15,237)

(20,535)

17,383

(38,731)

Interest Income and Dividend Revenue

5,651

5,938

6,053

6,957

6,748

22,830

25,696

Other

3,493

34

(73)

1,717

(1,364)

1,442

314

Total Revenues

165,875

241,108

55,044

22,724

109,711

695,397

428,587

Expenses

Compensation

49,877

47,124

51,324

41,864

52,382

187,325

192,694

Performance Fee Compensation

Realized Carried Interest

6,270

15,362

28,950

2,259

-

110,730

46,571

Realized Incentive Fees

8,401

12,455

13,659

15,598

10,127

59,689

51,839

Unrealized Carried Interest

(5,656)

21,497

(61,190)

(61,651)

(6,998)

(45,092)

(108,342)

Unrealized Incentive Fees

6,735

2,137

(12,846)

(4,421)

485

(24,905)

(14,645)

Total Compensation and Benefits

65,627

98,575

19,897

(6,351)

55,996

287,747

168,117

Other Operating Expenses

21,836

23,539

24,898

23,353

26,220

79,521

98,010

Total Expenses

87,463

122,114

44,795

17,002

82,216

367,268

266,127

Economic Income

78,412

$                

118,994

$              

10,249

$                

5,722

$                  

27,495

$                

328,129

$              

162,460

$              

Total Assets Under Management

74,959,534

$        

81,288,709

$        

80,841,348

$        

79,081,252

$        

78,656,291

$        

74,959,534

$        

78,656,291

$        

Fee-Earning Assets Under Management

59,271,744

$        

61,608,998

$        

60,337,992

$        

61,684,380

$        

62,094,760

$        

59,271,744

$        

62,094,760

$        

Weighted Average Fee-Earning AUM

58,607,856

$        

61,256,993

$        

60,243,777

$        

60,598,308

$        

61,584,275

$        

57,105,789

$        

60,968,572

$        

LP Capital Invested

814,423

$              

47,768

$                

424,365

$              

2,496,709

$           

586,935

$              

2,891,275

$           

3,555,777

$           

Total Capital Invested

989,775

$              

60,337

$                

432,212

$              

2,601,675

$           

568,731

$              

3,152,772

$           

3,662,955

$           

Blackstone

18

Financial Advisory

Note: On October 1, 2015, Blackstone spun-off its Financial Advisory businesses, which did not include Blackstone's capital markets services business. The results of Blackstone’s

capital markets services business have been reclassified from the Financial Advisory segment to the Private Equity segment. All prior periods have been recast to reflect this

reclassification.

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Revenues

Advisory Fees

81,809

$                

72,155

$                

143,606

$              

-

$                      

-

$                       

413,130

$              

215,761

$              

Transaction and Other Fees, Net

16

-

146

-

-

333

146

Total Advisory and Transaction Fees

81,825

72,155

143,752

-

-

413,463

215,907

Investment Income (Loss)

Realized

(230)

(159)

(479)

-

-

343

(638)

Unrealized

1,482

(523)

(998)

-

-

1,648

(1,521)

Total Investment Income (Loss)

1,252

(682)

(1,477)

-

-

1,991

(2,159)

Interest Income and Dividend Revenue

3,236

3,190

6,094

-

-

10,736

9,284

Other

(956)

(112)

(235)

-

-

(353)

(347)

Total Revenues

85,357

74,551

148,134

-

-

425,837

222,685

Expenses

Compensation

67,951

48,797

64,169

-

-

233,920

112,966

Total Compensation and Benefits

67,951

48,797

64,169

-

-

233,920

112,966

Other Operating Expenses

21,222

18,446

22,658

-

-

87,555

41,104

Total Expenses

89,173

67,243

86,827

-

-

321,475

154,070

Economic Income (Loss)

(3,816)

$                 

7,308

$                  

61,307

$                

-

$                      

-

$                       

104,362

$              

68,615

$                

Blackstone

19

Unitholder

Distribution

A detailed

description

of

Blackstone’s

distribution

policy

and

the

definition

of

Distributable

Earnings

can

be

found

on

page

30,

Definitions

and

Distribution

Policy.

DE

before

Certain

Payables

represents

Distributable

Earnings before the deduction for the Payable Under Tax Receivable Agreement and tax expense (benefit) of wholly owned subsidiaries. Per Unit calculations are based on end of period Total Common Units Outstanding

(page

29, Unit Rollforward); actual distributions are paid to unitholders as of the applicable record date. For the periods presented, Net Cash Available for Distribution per Common Unit equals the Actual Distribution per

Common

Unit.

Retained

capital

is

withheld

pro-rata

from

common

and

Blackstone

Holdings

Partnership

unitholders.

Common

unitholders’

share

was

$32.2

million

for

1Q’16

and

$247.8

million

for

1Q’16

LTM.

Generated

$0.33

of

Distributable

Earnings

per

common

unit

during

the

quarter,

down

69%

compared

to

the

same

period

last

year.

Declared

a

quarterly

distribution

of

$0.28

per

common

unit

to

record

holders

as

of

May

2,

2016;

payable

on

May

9,

2016.

% Change

% Change

(Dollars in Thousands, Except per Unit Data)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

vs. 1Q'15

1Q'15 LTM

1Q'16 LTM

vs. 1Q'15 LTM

Distributable Earnings (“DE”)

1,240,207

$

1,033,920

$

691,534

$   

878,027

$   

387,967

$   

(69)%

3,825,519

$

2,991,448

$

(22)%

Add: Other Payables Attributable

to Common Unitholders

7,288

-

-

26,918

-

(100)%

194,856

26,918

(86)%

DE before Certain Payables

1,247,495

1,033,920

691,534

904,945

387,967

(69)%

4,020,375

3,018,366

(25)%

Percent to Common Unitholders

53%

54%

54%

54%

54%

53%

54%

DE before Certain Payables Attributable

to Common Unitholders

663,608

554,120

370,902

487,075

210,286

(68)%

2,135,330

1,622,383

(24)%

Less: Other Payables Attributable

to Common Unitholders

(7,288)

-

-

(26,918)

-

(100)%

(194,856)

(26,918)

(86)%

DE Attributable to Common Unitholders

656,320

554,120

370,902

460,157

210,286

(68)%

1,940,474

1,595,465

(18)%

DE per Common Unit

1.05

$         

0.88

$         

0.58

$         

0.72

$         

0.33

$         

(69)%

3.16

$         

2.51

$         

(21)%

Less: Retained Capital per Common Unit

(0.16)

$       

(0.14)

$       

(0.09)

$       

(0.11)

$       

(0.05)

$       

(69)%

(0.50)

$       

(0.39)

$       

(22)%

Actual Distribution per Common Unit

0.89

$         

0.74

$         

0.49

$         

0.61

$         

0.28

$         

(69)%

2.66

$         

2.12

$         

(20)%

Record Date

May 2, 2016

Payable Date

May 9, 2016

Blackstone

20

1Q’16 Total AUM Rollforward

(Dollars in Millions)

1Q’16 LTM Total AUM Rollforward

(Dollars in Millions)

Inflows include contributions, capital raised, other increases in available capital, purchases and acquisitions. Outflows represent redemptions, client withdrawals and other decreases

in available capital. Realizations represent realizations from the disposition of assets. Market Activity represents gains (losses) on portfolio investments and impact of foreign

exchange rate fluctuations.

Total Assets Under Management

Private

Equity

Real

Estate

Hedge

Fund

Solutions

Credit

Inflows: Fifth European opportunistic fund ($5.2 billion); third mezzanine debt fund ($1.7 billion); BREP co-investment ($842 million);

BPP

U.S. ($555 million).

Realizations: BREP Global and European opportunistic platforms ($1.9 billion); BREP co-investment ($1.1 billion) and BREDS ($328

million).

Market Activity:

Carrying value increases of 1.8% and 4.4% within the opportunistic and core+ platforms, respectively.

Inflows: Individual investor and specialized solutions ($1.5 billion); customized solutions ($950 million); additional close of BAAM’s third

seeding vehicle ($400 million); commingled products ($362 million).

Market Activity:

BAAM’s Principal Solutions Composite down 2.9% gross (3.1% net) during the quarter.

Inflows: CLOs ($528 million); BDCs ($507 million); long only products ($462 million).

Outflows: Primarily driven by investor liquidity needs, shift in investor sentiment on credit and de-leveraging of the BDC funds.

Inflows: Strategic Partners ($1.8 billion); BCP VII ($899 million); Core Private Equity ($670 million); Tactical Opportunities ($327 million);

reduced by allocations of multi-strategy capital to Blackstone funds ($671 million).

Realizations: BCP V ($1.4 billion); Strategic Partners ($352 million).

Private

Real

Hedge Fund

Equity

Estate

Solutions

4Q'15

94,280

$    

93,918

$    

69,105

$    

79,081

$    

336,385

$  

Inflows

2,989

9,057

3,181

1,864

17,090

Outflows

(261)

(268)

(1,632)

(1,385)

(3,545)

Realizations

(2,119)

(3,451)

(151)

(885)

(6,606)

Net Inflows (Outflows)

608

5,339

1,398

(406)

6,939

Market Activity

578

1,851

(2,028)

(19)

382

1Q'16

95,466

$    

101,108

$  

68,475

$    

78,656

$    

343,705

$  

QoQ Increase (Decrease)

1%

8%

(1)%

(1)%

2%

Credit

Total

Private

Real

Hedge Fund

Equity

Estate

Solutions

1Q'15

76,327

$    

92,786

$    

66,379

$    

74,960

$    

310,451

$  

Inflows

30,153

20,170

11,138

18,724

80,185

Outflows

(642)

(442)

(5,916)

(5,673)

(12,673)

Realizations

(12,299)

(15,312)

(680)

(7,246)

(35,536)

Net Inflows

17,212

4,416

4,543

5,805

31,976

Market Activity

1,927

3,906

(2,446)

(2,108)

1,279

1Q'16

95,466

$    

101,108

$  

68,475

$    

78,656

$    

343,705

$  

YoY Increase

25%

9%

3%

5%

11%

Credit

Total

Blackstone

21

Inflows include contributions, capital raised, other increases in available capital, purchases and acquisitions. Outflows represent redemptions, client withdrawals and other decreases

in available capital. Realizations represent realizations from the disposition of assets. Market Activity represents gains (losses) on portfolio investments and impact of foreign

exchange rate fluctuations.

1Q’16 Fee-Earning AUM Rollforward

(Dollars in Millions)

1Q’16 LTM Fee-Earning AUM Rollforward

(Dollars in Millions)

Private

Equity

Real

Estate

Hedge

Fund

Solutions

Credit

Inflows:

BREP co-investment ($710 million); BREDS ($560 million).

Realizations: $1.4 billion across BREP platform including co-investment; $658 million in BREDS.

Inflows: Individual investor and specialized solutions ($1.5 billion); customized solutions ($950 million); commingled products ($362 million).

Outflows: Driven by investors’ liquidity needs and certain strategic shifts in their programs.

Inflows: BDCs ($507 million); CLOs ($500 million); long only products ($493 million).

Outflows: Primarily driven by investor liquidity needs, shift in investor sentiment on credit and de-leveraging of the BDC funds.

Inflows: Strategic Partners ($584 million); Tactical Opportunities ($288 million); reduced by allocations of multi-strategy capital to Blackstone

funds ($368 million).

Realizations: BCP V ($982 million); Strategic Partners ($214 million).

Fee-Earning Assets Under Management

Private

Real

Hedge Fund

Equity

Estate

Solutions

4Q'15

51,451

$    

67,345

$    

65,665

$    

61,684

$    

246,146

$  

Inflows

558

1,592

2,852

2,331

7,333

Outflows

(371)

(37)

(1,603)

(1,107)

(3,117)

Realizations

(1,288)

(2,120)

(146)

(723)

(4,277)

Net Inflows (Outflows)

(1,100)

(565)

1,103

501

(61)

Market Activity

(123)

518

(1,937)

(90)

(1,632)

1Q'16

50,228

$    

67,298

$    

64,831

$    

62,095

$    

244,453

$  

QoQ Increase (Decrease)

(2)%

(0)%

(1)%

1%

(1)%

Credit

Total

Private

Real

Hedge Fund

Equity

Estate

Solutions

1Q'15

49,342

$    

50,783

$    

64,114

$    

59,272

$    

223,512

$  

Inflows

6,794

27,846

9,448

15,668

59,755

Outflows

(780)

(4,170)

(5,766)

(5,035)

(15,752)

Realizations

(5,148)

(8,139)

(641)

(6,027)

(19,955)

Net Inflows

866

15,537

3,041

4,605

24,048

Market Activity

20

978

(2,324)

(1,782)

(3,107)

1Q'16

50,228

$    

67,298

$    

64,831

$    

62,095

$    

244,453

$  

YoY Increase

2%

33%

1%

5%

9%

Credit

Total

Blackstone

22

Net Accrued Performance Fees

$3.2

billion

Net Accrued Performance Fees at 1Q’16

$2.70

per unit

Net Accrued Performance Fees at 1Q’16

36%

of 1Q’15 Net Accrued Performance

Fees realized in 1Q’16 LTM

(Dollars in Millions, Except per Unit Data)

4Q'15

1Q'16

1Q'16 Per Unit

QoQ Change

Private Equity

BCP IV Carried Interest

144

$                     

155

$                      

0.13

$                     

11

$                        

BCP V Carried Interest

288

358

0.30

70

BCP VI Carried Interest

359

340

0.29

(19)

BEP Carried Interest

48

46

0.04

(2)

Tactical Opportunities Carried Interest

52

56

0.05

4

BTAS Carried Interest

3

5

-

2

Strategic Partners Carried Interest

36

38

0.03

2

Other Carried Interest

1

2

-

1

Total Private Equity

931

$                     

1,000

$                  

0.84

$                     

69

$                        

Real Estate

BREP IV Carried Interest

20

11

0.01

(9)

BREP V Carried Interest

497

417

0.35

(80)

BREP VI Carried Interest

628

636

0.54

8

BREP VII Carried Interest

608

570

0.48

(38)

BREP VIII Carried Interest

7

34

0.03

27

BREP Europe III Carried Interest

186

181

0.15

(5)

BREP Europe IV Carried Interest

121

126

0.11

5

BREP Asia Carried Interest

54

68

0.06

14

BPP Carried Interest

28

41

0.03

13

BPP Incentive Fees

12

18

0.02

6

BREDS Carried Interest

12

16

0.01

4

BREDS Incentive Fees

6

2

-

(4)

Asia Platform Incentive Fees

7

7

0.01

-

Total Real Estate

2,186

$                 

2,127

$                 

1.79

$                    

(59)

$                      

Hedge

Fund

Solutions

Incentive Fees

38

5

-

(33)

Total Hedge Fund Solutions

38

$                       

5

$                          

-

$                      

(33)

$                       

Credit

Carried Interest

77

66

0.06

(11)

Incentive Fees

19

14

0.01

(5)

Total Credit

96

$                       

80

$                        

0.07

$                    

(16)

$                      

Total Blackstone

Carried Interest

3,169

3,166

2.67

(3)

Incentive Fees

82

46

0.04

(36)

Net Accrued Performance Fees

3,251

$                 

3,212

$                 

2.70

$                    

(39)

$                      

Memo: Net Realized Performance Fees

89

$                      

28

$                       

0.02

$                   

(61)

$                     

Net Accrued Performance Fees are presented net of performance fee compensation and do not include clawback amounts, if any, which are disclosed in the 10-K/Q. Net Realized

Performance Fees are included in DE. Net Realized Performance Fees represents Performance Fees realized, but not yet distributed as of the reporting date and included in the Net

Accrued Performance Fee balance. When these fees are received, the receivable is reduced without further impacting DE. Per Unit calculations are based on end of period DE Units

Outstanding (see page 29, Unit Rollforward). 

Blackstone

23

Investment Records as of March 31, 2016

(a)

Continued...

Committed

Available

Unrealized Investments

Realized Investments

Total Investments

Net IRRs (d)

(Dollars in Thousands, Except Where Noted)

Capital

Capital (b)

Value

MOIC (c)

% Public

Value

MOIC (c)

Value

MOIC (c)

Realized

Total

Private

Equity

BCP I (Oct 1987 / Oct 1993)

859,081

$         

-

$                 

-

$                 

n/a

-

1,741,738

$     

2.6x

1,741,738

$     

2.6x

19%

19%

BCP II (Oct 1993 / Aug 1997)

1,361,100

-

-

n/a

-

3,256,819

2.5x

3,256,819

2.5x

32%

32%

BCP III (Aug 1997 / Nov 2002)

3,967,422

-

-

n/a

-

9,184,688

2.3x

9,184,688

2.3x

14%

14%

BCOM (Jun 2000 / Jun 2006)

2,137,330

126,093

116,658

1.7x

66%

2,851,514

1.4x

2,968,172

1.4x

7%

6%

BCP IV (Nov 2002 / Dec 2005)

6,773,182

219,136

2,160,727

1.3x

31%

18,951,775

3.2x

21,112,502

2.8x

43%

36%

BCP V (Dec 2005 / Jan 2011)

21,025,507

1,261,736

10,330,979

1.6x

76%

27,296,433

2.0x

37,627,412

1.9x

10%

8%

BCP VI (Jan 2011 / Jan 2017)

15,188,733

2,797,578

14,976,100

1.3x

24%

2,044,675

1.9x

17,020,775

1.3x

50%

10%

BEP (Aug 2011 / Feb 2015)

2,439,112

183,562

2,713,693

1.3x

25%

539,548

2.0x

3,253,241

1.4x

57%

14%

BEP II (Feb 2015 / Feb 2021)

4,951,351

4,875,450

22,908

1.0x

-

-

n/a

22,908

1.0x

n/a

n/a

BCP VII (TBD)

18,898,630

18,898,630

-

n/a

-

-

n/a

-

n/a

n/a

n/a

Total Corporate Private Equity

77,601,448

$   

28,362,185

$   

30,321,065

$   

1.4x

42%

65,867,190

$   

2.3x

96,188,255

$   

1.9x

19%

15%

Tactical Opportunities

13,287,442

6,765,473

7,328,776

1.1x

7%

1,296,745

1.5x

8,625,521

1.2x

31%

10%

Strategic Partners I-V and Co-Investment

12,156,390

2,356,537

3,991,432

2.9x

-

13,110,144

1.3x

17,101,576

1.5x

n/a

14%

Strategic Partners VI LBO, RE and SMA (e)

6,737,766

1,653,078

3,567,570

n/m

-

432,994

n/m

4,000,564

1.4x

n/a

44%

Strategic Partners VII

1,511,972

1,511,972

-

n/a

-

-

n/a

-

n/a

n/a

n/a

BCEP (f)

669,500

669,500

-

n/a

-

-

n/a

-

n/a

n/a

n/a

Other Funds and Co-Investment (g)

2,343,637

620,141

1,409,258

1.1x

33%

228,347

1.3x

1,637,605

1.1x

n/a

n/a

Total Private Equity

114,308,155

$ 

41,938,886

$   

46,618,101

$   

1.4x

30%

80,935,420

$   

2.0x

127,553,521

$ 

1.7x

19%

15%

Real

Estate

Dollar

Pre-BREP

140,714

$         

-

$                 

-

$                 

n/a

-

345,190

$         

2.5x

345,190

$         

2.5x

33%

33%

BREP I (Sep 1994 / Oct 1996)

380,708

-

-

n/a

-

1,327,708

2.8x

1,327,708

2.8x

40%

40%

BREP II (Oct 1996 / Mar 1999)

1,198,339

-

-

n/a

-

2,531,613

2.1x

2,531,613

2.1x

19%

19%

BREP III (Apr 1999 / Apr 2003)

1,522,708

-

-

n/a

-

3,336,402

2.4x

3,336,402

2.4x

21%

21%

BREP IV (Apr 2003 / Dec 2005)

2,198,694

-

653,847

0.7x

14%

3,900,697

2.2x

4,554,544

1.7x

40%

13%

BREP V (Dec 2005 / Feb 2007)

5,539,418

-

3,938,344

2.2x

31%

8,899,153

2.2x

12,837,497

2.2x

13%

11%

BREP VI (Feb 2007 / Aug 2011)

11,059,523

579,112

7,608,688

2.2x

68%

17,951,460

2.4x

25,560,148

2.3x

15%

13%

BREP VII (Aug 2011 /Apr 2015)

13,491,598

2,461,897

15,743,502

1.6x

1%

8,584,025

1.9x

24,327,527

1.7x

31%

21%

BREP VIII (Apr 2015 / Oct 2020)

16,145,129

10,754,125

5,921,200

1.1x

-

4,793

1.0x

5,925,993

1.1x

n/a

16%

Total Global BREP

51,676,831

$   

13,795,134

$   

33,865,581

$   

1.6x

20%

46,881,041

$   

2.2x

80,746,622

$   

1.9x

21%

17%

Euro

BREP Int'l (Jan 2001 / Sep 2005)

824,172

€

-

€

-

€

n/a

-

1,364,490

€

2.1x

1,364,490

€

2.1x

23%

23%

BREP Int'l II (Sep 2005 / Jun 2008)

1,629,748

-

530,198

1.1x

64%

1,714,052

1.8x

2,244,250

1.6x

8%

5%

BREP Europe III (Jun 2008 / Sep 2013)

3,205,140

466,916

3,201,449

1.9x

-

2,635,024

2.1x

5,836,473

2.0x

23%

18%

BREP Europe IV (Sep 2013 / Mar 2019)

6,696,404

2,110,961

6,334,310

1.3x

-

573,041

1.4x

6,907,351

1.3x

27%

16%

BREP Europe V (TBD)

4,669,823

4,669,823

-

n/a

-

-

n/a

-

n/a

n/a

n/a

Total Euro BREP

17,025,287

€

7,247,700

€

10,065,957

€

1.4x

3%

6,286,607

€

2.0x

16,352,564

€

1.6x

16%

13%

BREP Co-Investment (h)

6,819,065

$     

-

$                 

5,125,104

$     

1.6x

46%

7,387,601

$     

2.1x

12,512,705

$   

1.9x

17%

16%

BREP Asia (Jun 2013 / Dec 2017)

5,081,069

2,728,072

3,143,960

1.3x

-

185,124

1.5x

3,329,084

1.3x

22%

14%

Total BREP

84,884,181

$   

24,691,363

$   

54,805,711

$   

1.5x

17%

62,823,968

$   

2.2x

117,629,679

$ 

1.8x

20%

16%

BPP (i)

10,909,794

$   

2,752,215

$     

9,485,250

$     

1.2x

-

-

$                 

n/a

9,485,250

$     

1.2x

n/a

17%

BREDS (j)

9,789,251

$     

5,374,702

$     

2,481,353

$     

1.3x

-

5,681,724

$     

1.3x

8,163,077

$     

1.3x

13%

12%

Blackstone

24

Investment Records as of March 31, 2016

(a)

–

Continued

The returns presented herein represent those of the applicable Blackstone Funds and not those of The Blackstone Group L.P.

n/m

Not meaningful.

n/a

Not applicable.

(a)

Preliminary.

(b)

Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital

and may include leverage, less invested capital. This amount is not reduced by outstanding commitments to investments.

(c)

Multiple of Invested Capital (“MOIC”) represents carrying value, before management fees, expenses and Carried Interest, divided by invested capital.

(d)

Net

Internal

Rate

of

Return

(“IRR”)

represents

the

annualized

inception

to

March

31,

2016

IRR

on

total

invested

capital

based

on

realized

proceeds

and

unrealized value, as applicable, after management fees, expenses and Carried Interest.

(e)

Realizations are treated as return of capital until fully recovered and therefore unrealized and realized MOIC’s are not meaningful in the early life of the

funds.

(f)

BCEP, or Blackstone Core Equity Partners, is a core private equity fund which invests with a more modest risk profile and longer hold period.

(g)

Returns for Other Funds and Co-Investment are not meaningful as these funds have limited transaction activity.

(h)

BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-

investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Carried Interest.

(i)

BPP, or Blackstone Property Partners, are the core+ real estate funds which invest with a more modest risk profile and lower leverage.

(j)

Excludes Capital Trust drawdown funds.

(k)

BSCH is a permanent capital vehicle focused on acquiring strategic minority positions in alternative asset managers.

(l)

The Total Investments MOIC for Mezzanine I, Mezzanine II, Rescue Lending I, Rescue Lending II Funds, Energy Select Opportunities Fund and European

Senior Debt Fund, excluding recycled capital during the investment period was 2.0x, 1.4x, 1.6x, 1.0x, 1.1x and n/m, respectively. Funds presented

represent the flagship credit drawdown funds only. The Total Credit Net IRR is the combined IRR of the six credit drawdown funds presented.

Committed

Available

Unrealized Investments

Realized Investments

Total Investments

Net IRRs (d)

(Dollars in Thousands, Except Where Noted)

Capital

Capital (b)

Value

MOIC (c)

% Public

Value

MOIC (c)

Value

MOIC (c)

Realized

Total

Hedge Fund Solutions

BSCH (Dec 2013 / Jun 2020) (k)

3,300,600

$      

2,755,702

$      

549,508

$          

1.0x

-

68,755

$            

n/a

618,263

$          

1.2x

n/a

5%

BSCH Co-Investment

75,500

31,237

44,481

1.0x

-

1,254

n/a

45,735

1.0x

n/a

5%

Total Hedge Fund Solutions

3,376,100

$      

2,786,939

$      

593,989

$          

1.0x

-

70,009

$            

n/a

663,998

$          

1.2x

n/a

5%

Credit (l)

Mezzanine I (Jul 2007 / Oct 2011)

2,000,000

$      

99,280

$            

444,786

$          

1.7x

-

4,406,799

$      

1.6x

4,851,585

$      

1.6x

n/a

18%

Mezzanine II (Nov 2011 / Nov 2016)

4,120,000

2,005,610

2,746,265

1.1x

-

1,896,457

1.4x

4,642,722

1.2x

n/a

13%

Rescue Lending I (Sep 2009 / May 2013)

3,253,143

553,745

1,465,694

1.2x

-

4,197,595

1.5x

5,663,289

1.4x

n/a

11%

Rescue Lending II (Jun 2013 / Jun 2018)

5,125,000

2,561,654

2,701,252

1.0x

-

88,846

1.1x

2,790,098

1.0x

n/a

2%

Energy Select Opportunities (Nov 2015 / Nov 2018)

2,856,866

2,469,556

419,038

1.1x

-

-

n/a

419,038

1.1x

n/a

n/m

Euro

European Senior Debt (Feb 2015 / Feb 2018)

1,964,689

€      

3,369,434

€      

523,149

€          

1.0x

-

142,288

€          

1.2x

665,437

€          

1.0x

n/a

n/m

Total Credit

19,621,419

$    

11,529,777

$    

8,372,349

$      

1.1x

-

10,747,165

$    

1.5x

19,119,514

$    

1.3x

n/a

14%

Blackstone

25

Reconciliation of GAAP to Non-GAAP Measures

Notes on page 26.

(Dollars in Thousands)

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

1Q'15 LTM

1Q'16 LTM

Net Income (Loss) Attributable to The Blackstone Group L.P.

629,448

$    

134,168

$    

(254,697)

$  

200,870

$    

150,033

$    

1,948,420

$

230,374

$    

Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings

645,230

134,870

(247,318)

150,734

131,202

2,046,825

169,488

Net Income Attributable to Non-Controlling Interests in Consolidated Entities

81,796

66,716

30,671

40,717

40,086

372,905

178,190

Net Income (Loss) Attributable to Redeemable Non-Controlling

Interests in Consolidated Entities

7,527

13,780

(12,520)

2,358

(6,401)

36,529

(2,783)

Net Income (Loss)

1,364,001

$

349,534

$    

(483,864)

$  

394,679

$    

314,920

$    

4,404,679

$

575,269

$    

Provision for Taxes

99,344

43,251

1,573

46,230

18,866

336,420

109,920

Income (Loss) Before Provision for Taxes

1,463,345

$

392,785

$    

(482,291)

$  

440,909

$    

333,786

$    

4,741,099

$

685,189

$    

Transaction-Related Charges

(a)

231,862

192,018

80,962

(15,279)

64,136

911,220

321,837

Amortization of Intangibles

(b)

25,899

24,720

30,624

23,287

23,208

108,150

101,839

(Income) Associated with Non-Controlling Interests of Consolidated Entities

(c)

(89,323)

(80,496)

(18,151)

(43,075)

(33,685)

(409,434)

(175,407)

Economic Income (Loss)

1,631,783

$

529,027

$    

(388,856)

$  

405,842

$    

387,445

$    

5,351,035

$

933,458

$    

Taxes

(d)

(9,719)

(20,587)

(27,070)

29,849

(16,794)

(197,919)

(34,602)

Economic Net Income (Loss)

1,622,064

$

508,440

$    

(415,926)

$  

435,691

$    

370,651

$    

5,153,116

$

898,856

$    

Taxes

(d)

9,719

20,587

27,070

(29,849)

16,794

197,919

34,602

Performance Fee Adjustment

(e)

(1,673,736)

(569,664)

639,349

(194,026)

(314,065)

(5,286,599)

(438,406)

Investment (Income) Loss Adjustment

(f)

(189,641)

(10,774)

136,131

11,435

26,650

(544,802)

163,442

Net Interest Loss

(g)

8,402

14,411

9,522

11,846

13,351

36,877

49,130

Performance Fee Compensation and Benefits Adjustment

(h)

403,816

215,441

(130,479)

75,782

106,075

1,452,065

266,819

Fee Related Earnings

180,624

$    

178,441

$    

265,667

$    

310,879

$    

219,456

$    

1,008,576

$

974,443

$    

Net Realized Performance Fees

(i)

932,789

725,433

357,114

505,540

186,733

2,504,961

1,774,820

Realized Investment Income (Loss)

(j)

107,792

136,497

87,526

86,993

(10,101)

539,300

300,915

Net Interest (Loss)

(g)

(8,402)

(14,411)

(9,522)

(11,846)

(13,351)

(36,877)

(49,130)

Taxes and Related Payables

Including Payable Under Tax Receivable Agreement

(k)

(16,994)

(20,587)

(27,070)

(25,819)

(16,794)

(266,728)

(90,270)

Equity-Based Compensation

(l)

44,398

28,547

17,819

12,280

22,024

76,287

80,670

Distributable Earnings

1,240,207

$

1,033,920

$

691,534

$    

878,027

$    

387,967

$    

3,825,519

$

2,991,448

$

Interest Expense

38,853

45,437

44,981

46,511

48,432

141,310

185,361

Taxes and Related Payables Including Payable Under Tax Receivable Agreement

(k)

16,994

20,587

27,070

25,819

16,794

266,728

90,270

Depreciation and Amortization

6,927

6,715

6,719

6,852

6,292

28,854

26,578

Adjusted EBITDA

1,302,981

$

1,106,659

$

770,304

$    

957,209

$    

459,485

$    

4,262,411

$

3,293,657

$

Blackstone

26

Reconciliation

of

GAAP

to

Non-GAAP

Measures

–

Notes

Note:

See page 30, Definitions and Distribution Policy.

(a)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes amounts for Transaction-Related Charges which

include principally equity-based compensation charges associated with Blackstone’s initial public offering and long-term retention

programs outside of annual deferred compensation and other corporate actions.

(b)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes amounts for the Amortization of Intangibles which

are associated with Blackstone’s initial public offering and other corporate actions.

(c)

This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes the amount of (Income) Loss Associated with Non-

Controlling Interests of Consolidated Entities and includes the amount of Management Fee Revenues associated with Consolidated

CLO Entities.

(d)

Taxes represent the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes.

(e)

This adjustment removes from EI the total segment amount of Performance Fees.

(f)

This adjustment removes from EI the total segment amount of Investment Income (Loss).

(g)

This adjustment represents Interest Income and Dividend Revenue less Interest Expense.

(h)

This adjustment removes from expenses the compensation and benefit amounts related to Blackstone’s profit sharing plans related

to Performance Fees.

(i)

Represents the adjustment for realized Performance Fees net of corresponding actual amounts due under Blackstone’s profit

sharing plans related thereto. Equals the sum of Net Realized Incentive Fees and Net Realized Carried Interest.

(j)

Represents the adjustment for Blackstone’s Realized Investment Income (Loss).

(k)

Taxes and Related Payables Including Payable Under Tax Receivable Agreement represent the current tax provision (benefit)

calculated on Income (Loss) Before Provision (Benefit) for Taxes and the Payable Under Tax Receivable Agreement.

(l)

Represents equity-based award expense included in EI, which excludes all transaction-related equity-based charges.

Blackstone

27

See page 28, Walkdown of Financial Metrics –

Calculation of Certain Non-GAAP Financial Metrics for the calculation of the amounts presented herein that are not the respective captions on

page

13, Total Segments. 1Q’16 Fee Related Earnings per Unit is based on end of period DE Units Outstanding; 1Q’16 DE per Unit is based on DE attributable to Common Unit Holders (see page 19,

Unitholder Distribution) and end of period Total Common Units Outstanding; and 1Q’16 ENI per Unit is based on Weighted-Average ENI Adjusted Units. 1Q’16 LTM per Unit represents the sum of

the last four quarters. See page 29, Unit Rollforward.

(Dollars in Thousands, Except per Unit Data)

1Q'16

1Q'16 LTM

Results

Per Unit

Results

Per Unit

Base Management Fees

586,703

$         

2,266,889

$     

Advisory Fees

481

224,374

Transaction and Other Fees, Net

46,118

162,730

Management Fee Offsets

(20,101)

(95,650)

Other Revenue

(6,248)

7,124

Compensation

(287,403)

(1,146,784)

Non-Interest Operating Expenses

(100,094)

(444,240)

Fee Related Earnings

219,456

$         

0.18

$               

974,443

$         

0.81

$               

Net Realized Incentive Fees

14,327

105,684

Net Realized Carried Interest

172,406

1,669,136

Realized Investment Income (Loss)

(10,101)

300,915

Net Interest (Loss)

(13,351)

(49,130)

Taxes and Related Payables

(16,794)

(90,270)

Equity-Based Compensation

22,024

80,670

Distributable Earnings

387,967

$         

0.33

$               

2,991,448

$     

2.51

$               

Net Unrealized Incentive Fees

3,652

(38,766)

Net Unrealized Carried Interest

17,605

(1,564,467)

Unrealized Investment (Loss)

(16,549)

(464,357)

Add Back: Related Payables

-

55,668

Less: Equity-Based Compensation

(22,024)

(80,670)

Economic Net Income

370,651

$         

0.31

$               

898,856

$         

0.76

$               

Walkdown of Financial Metrics

Blackstone

28

Walkdown

of

Financial

Metrics

–

Calculation

of

Certain

Non-GAAP

Financial

Metrics

Unless otherwise noted, all amounts are the respective captions from the Total Segment information.

(a)

Represents equity-based award expense included in Economic Income, which excludes all transaction-related equity-based charges.

(b)

See page 25, Reconciliation of GAAP to Non-GAAP Measures for this adjustment.

(c)

Represents tax-related payables including the Payable Under Tax Receivable Agreement, which is a component of Taxes and Related Payables.

(Dollars in Thousands)

1Q'16

1Q'16 LTM

Other Operating Expenses

148,526

$       

629,601

$       

Less: Interest Expense

(48,432)

(185,361)

Non-Interest Operating Expenses

100,094

$      

444,240

$      

Realized Incentive Fees

28,450

193,526

Less: Realized Incentive Fee Compensation

(14,123)

(87,842)

Net Realized Incentive Fees

14,327

$         

105,684

$      

Realized Carried Interest

230,909

2,229,191

Less: Realized Carried Interest Compensation

(58,503)

(560,055)

Net Realized Carried Interest

172,406

$      

1,669,136

$   

Interest Income and Dividend Revenue

35,081

136,231

Less: Interest Expense

(48,432)

(185,361)

Net Interest (Loss)

(13,351)

$       

(49,130)

$       

Equity-Based Compensation

(a)

22,024

$         

80,670

$         

Taxes and Related Payables

(b)

(16,794)

$       

(90,270)

$       

Unrealized Incentive Fees

7,100

(62,769)

Less: Unrealized Incentive Fee Compensation

(3,448)

24,003

Net Unrealized Incentive Fees

3,652

$           

(38,766)

$       

Unrealized Carried Interest

47,606

(1,921,542)

Less: Unrealized Carried Interest Compensation

(30,001)

357,075

Net Unrealized Carried Interest

17,605

$         

(1,564,467)

$  

Related Payables

(c)

-

$               

55,668

$         

Blackstone

29

Unit Rollforward

1Q'15

2Q'15

3Q'15

4Q'15

1Q'16

Total GAAP Weighted-Average Common Units Outstanding - Basic

625,276,969

631,881,205

638,832,799

641,134,086

644,897,849

Adjustments:

Weighted-Average Unvested Deferred Restricted Common Units

5,955,072

2,311,444

-

1,794,046

1,629,702

Weighted-Average Blackstone Holdings Partnership Units

-

-

-

547,495,655

548,042,780

Total GAAP Weighted-Average Units Outstanding - Diluted

631,232,041

634,192,649

638,832,799

1,190,423,787

1,194,570,331

Adjustments:

Weighted-Average Unvested Deferred Restricted Common Units

-

-

1,913,028

-

-

Weighted-Average Blackstone Holdings Partnership Units

548,837,150

555,641,388

550,983,910

-

-

Weighted-Average Economic Net Income Adjusted Units

1,180,069,191

1,189,834,037

1,191,729,737

1,190,423,787

1,194,570,331

Economic Net Income Adjusted Units, End of Period

1,192,529,251

1,190,864,027

1,191,328,573

1,190,361,741

1,194,227,352

Total Common Units Outstanding

625,985,058

630,414,455

635,440,608

637,410,828

643,789,108

Adjustments:

Blackstone Holdings Partnership Units

550,783,119

545,861,003

549,317,005

546,844,892

543,969,293

Distributable Earnings Units Outstanding

1,176,768,177

1,176,275,458

1,184,757,613

1,184,255,720

1,187,758,401

Common Unitholders receive tax benefits from deductions taken by Blackstone’s corporate tax paying subsidiaries and bear responsibility for the deduction from Distributable Earnings of

the Payable Under Tax Receivable Agreement and certain other tax-related payables. Distributable Earnings Units Outstanding excludes units which are not entitled to distributions.

Blackstone

30

Definitions and Distribution Policy

Blackstone discloses the following financial measures that are calculated and presented on the basis of methodologies other than in accordance with generally accepted

accounting principles in the United States of America (“non-GAAP”) in this presentation:

•

Blackstone uses Economic Income, or “EI”, as a key measure of value creation, a benchmark of its performance and in making resource deployment and

compensation decisions across its four segments. EI represents segment net income before taxes excluding transaction-related charges. Transaction-related charges

arise from Blackstone’s initial public offering (“IPO”) and long-term retention programs outside of annual deferred compensation and other corporate actions,

including acquisitions. Transaction-related charges include equity-based compensation charges, the amortization of intangible assets and contingent consideration

associated with acquisitions. EI presents revenues and expenses on a basis that deconsolidates the investment funds Blackstone manages.

•

Economic Net Income, or “ENI”, represents EI adjusted to include current period taxes. Taxes represent the current tax provision (benefit) calculated on Income

(Loss) Before Provision for Taxes.

•

Blackstone uses Fee Related Earnings, or “FRE”, which is derived from EI, as a measure to highlight earnings from operations excluding:  (a) the income related to

performance fees and related carry plan costs and (b) income earned from Blackstone’s investments in the Blackstone Funds. Blackstone uses FRE as a measure to

assess whether recurring revenue from its businesses is sufficient to adequately cover all of its operating expenses and generate profits. FRE equals contractual fee

revenues less (a) compensation expenses (which includes amortization of non-IPO and non-acquisition-related equity-based awards, but excludes amortization of

IPO and acquisition-related equity-based awards, Carried Interest and incentive fee compensation), and (b) non-interest operating expenses.

•

Distributable Earnings, or “DE”, which is derived from Blackstone’s segment reported results, is a supplemental measure to assess performance and amounts

available for distributions to Blackstone unitholders, including Blackstone personnel and others who are limited partners of the Blackstone Holdings partnerships. DE

is intended to show the amount of net realized earnings without the effects of the consolidation of the Blackstone Funds. DE, which is a component of ENI, is the

sum across all segments of:  (a) Total Management and Advisory Fees, (b) Interest and Dividend Revenue, (c) Other Revenue, (d) Realized Performance Fees, and

(e) Realized Investment Income (Loss); less (a) Compensation, excluding the expense of equity-based awards, (b) Realized Performance Fee Compensation, (c) Other

Operating Expenses, and (d) Taxes and Related Payables Under the Tax Receivable Agreement. DE is reconciled to Blackstone’s Consolidated Statement of

Operations. 

•

Blackstone uses Adjusted Earnings Before Interest, Taxes and Depreciation and Amortization, or “Adjusted EBITDA”, is a supplemental non-GAAP measure derived

from segment reported results and may be used to assess its ability to service its borrowings. Adjusted EBITDA represents DE plus the addition of (a) Interest

Expense, (b) Taxes and Related Payables Including Payable Under Tax Receivable Agreement, and (c) Depreciation and Amortization.

Distribution Policy. Blackstone’s intention is to distribute quarterly to common unitholders approximately 85% of The Blackstone Group L.P.’s share of Distributable

Earnings, subject to adjustment by amounts determined by Blackstone’s general partner to be necessary or appropriate to provide for the conduct of its business, to

make appropriate investments in its business and funds, to comply with applicable law, any of its debt instruments or other agreements, or to provide for future cash

requirements such as tax-related payments, clawback obligations and distributions to unitholders for any ensuing quarter. The amount to be distributed could also be

adjusted upward in any one quarter. All of the foregoing is subject to the qualification that the declaration and payment of any distributions are at the sole discretion of

Blackstone’s general partner and may change its distribution policy at any time, including, without limitation, to eliminate such distributions entirely.

Blackstone

31

Forward-Looking Statements

This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and

Section 21E of the Securities Exchange Act of 1934 which reflect Blackstone’s current views with respect to, among other things,

Blackstone’s operations and financial performance. 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,” “estimates,” “anticipates” 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.

Blackstone

believes

these

factors

include

but

are

not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended

December 31, 2015, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange

Commission, 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 presentation and in the filings. Blackstone

undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future

developments or otherwise.

This presentation does not constitute an offer of any Blackstone Fund.