2013 Blackstone Investor Day PDF

2013 Blackstone Investor Day
May 3, 2013
The Waldorf=Astoria
New York, NY
Forward-Looking Statements
These Materials 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,”
“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, 2012, 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.
Blackstone 1
Important Disclosures
Not an offer. The Materials are provided as an overview of The Blackstone Group L.P. and are for informational purposes only, and do not constitute an offer to sell,
or a solicitation of an offer to buy, any security or instrument, or a solicitation of interest in any particular Blackstone fund, account or strategy. If such an offer is
made, it will only be made by means of an offering document, which would contain material information (including certain risks of investing in such security, fund or
strategy) not contained in the Materials and which would supersede and qualify in its entirety the information set forth in the Materials. Any decision to invest in a
fund should only be made after reviewing the offering document, conducting such investigations as an investor deems necessary and consulting the investor’s own
legal, accounting and tax advisors in order to make an independent determination of the suitability and consequences of an investment.
Performance Information. Past performance is not necessarily indicative of future results and there can be no assurance that any Blackstone fund or strategy will
achieve comparable results, or that any investments made by Blackstone in the future will be profitable. Actual realized value of currently unrealized investments will
depend on, among other factors, future operating results, the value of the assets and market conditions at the time of disposition, any related transaction costs and
the timing and manner of sale, all of which may differ from the assumptions and circumstances on which the current unrealized valuations are based. Accordingly, the
actual realized values of unrealized investments may differ materially from the values indicated herein.
General. Data in the Materials is as of March 31, 2013 unless otherwise noted. Neither Blackstone, nor any Blackstone fund nor any of Blackstone’s affiliates makes
any representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein. Unless otherwise specified, the source
for all graphs, charts and information in the Materials is Blackstone. Certain information contained in the Materials has been obtained from sources outside
Blackstone. While such information is believed to be reliable for purposes used herein, no representations are made as to the accuracy or completeness thereof and
Blackstone does not take any responsibility for such information. Certain information contained in the presentation discusses general market activity, industry or
sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice.
Private Equity and Real Estate. Except as otherwise noted, the Gross Annual Rate of Return represents the compound annual rate of return (“IRR”) before
partnership expenses, management fees, drawdowns for organizational and partnership expenses, and the General Partner’s allocation of profit, but after
partnership expenses withheld from distributions. The Net Annual Rate of Return represents the IRR after management fees, drawdowns for organizational expenses
and partnership expenses, partnership expenses withheld from distributions, and the General Partner’s allocation of profits but does not include taxes or
withholdings specific to certain limited partners. Net returns for Private Equity core funds shown for realized investments and total (realized plus unrealized)
investments, from inception of the business in October 1987. Private Equity core funds represent the flagship global funds (BCP I – BCP VI) and flagship sector funds
(Blackstone Energy and Blackstone Communication funds); does not include Tactical Opportunity and Asia funds. These returns are calculated as the internal rate of
return of the total contributions and distributions (including fees, drawdown of expenses, return of capital and recouped losses) for all investments. Net returns for
global real estate opportunity funds shown for realized investments and total (realized plus unrealized) investments, from inception of the business in January 1992.
Global opportunity funds include Pre-BREP – BREP VII, and exclude real estate debt funds, international funds and co-investment vehicles.
Private Equity, Section X, page 2: Outperformance as compared to the S&P 500 Total Return Index, using the corresponding annual rate of return of the index from
each contribution / disposition date to the quarter end for all investments. The index comparison is provided solely as an indication of returns that could be earned by
investors by making similar investments in the S&P 500 Total Return Index. Blackstone’s funds differ from the index in that, among other factors, Blackstone’s funds
are actively managed entities that bear fees and use leverage.
Blackstone 2
Important Disclosures
Real Estate. Section X, page 3: Outperformance as compared to the NCREIF-ODCE Index. The NCREIF-ODCE (NCREIF Fund Index - Open-End Diversified Core Equity),
which began in 1973, is a fund-level capitalization weighted, time-weighted return index that consists of 28 open-ended core funds. The average index leverage is
approximately 30% and includes property investments at ownership share, cash balances and leverage. NCREIF-ODCE’s returns are reported on a quarterly basis.
NCREIF-ODCE’s net annual rate of return is provided solely as an indication of returns that could be earned by investors making real estate investments. Blackstone’s
funds differ from the NCREIF-ODCE Index for several factors. NCREIF Returns have been calculated as the IRR of the total contributions and dispositions (including
fees, drawdown of expenses, return of capital, and recouped losses), and the corresponding annual rate of return of the NCREIF-ODCE from each contribution date to
each disposition or return of capital date, or the quarter end for unrealized investments.
Hedge Fund Solutions. Section VIII, pages 1, 15, 16 and 20 and Section X, page 4: The volatility of the indices presented may be materially different from that of the
performance of the relevant Blackstone fund. In addition, the indices employ different investment guidelines and criteria than the Blackstone fund; as a result, the
holdings in fund may differ significantly from the securities that comprise the indices. The performance of the indices has not been selected to represent an
appropriate benchmark to compare to the performance of the Blackstone fund, but rather is disclosed to allow for comparison of the fund’s performance to that of
well-known and widely recognized indices. Summaries of the investment guidelines for the indices presented is available upon request. In the case of equity indices,
performance of the indices reflects the reinvestment of dividends.
Credit. The volatility of the benchmarks presented may be materially different from that of the performance of a GSO fund. In addition, the benchmarks employ
different investment guidelines and criteria than GSO funds; as a result, the holdings in a GSO fund may differ significantly from the securities that comprise the
benchmarks. The performance of the benchmarks has not been selected to represent an appropriate benchmark to compare to the performance of any GSO fund,
but rather is disclosed to allow for comparison of a GSO fund’s performance to that of well-known and widely recognized benchmarks. The names of the relevant
benchmarks and a summary of the investment guidelines for the benchmarks presented are available upon request.
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Agenda – Friday, May 3, 2013
Time Function Location

8:00 am – 8:05 am Introduction Empire
Joan Solotar, Head of External Relations and Strategy Lobby Level
8:05 am – 8:20 am Welcome Remarks Empire
Steve Schwarzman, Chairman, CEO and Co-Founder Lobby Level
8:20 am – 8:40 am Financials Overview Empire
Laurence Tosi, Chief Financial Officer Lobby Level
8:40 am – 9:10 am Real Estate Empire
Jon Gray, Global Head of Real Estate Lobby Level
(Video: Invitation Homes)
9:10 am – 9:25 am Break Empire Terrace
Lobby Level
9:25 am – 9:55 am Private Equity Empire
Joe Baratta, Global Head of Private Equity Lobby Level
(Video: Bujagali Hydroelectric Project – Sithe Global)
9:55 am – 10:15 am Portfolio Operations Empire
James Quella, Co-Head of Portfolio Operations Lobby Level
10:15 am – 10:35 am Advisory & Restructuring Empire
Tim Coleman, Head of Restructuring & Reorganization Lobby Level
10:35 am – 11:05 am BAAM Empire
Tom Hill, President and CEO, BAAM Lobby Level
Vice Chairman, Blackstone
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Agenda – Friday, May 3, 2013
Time Function Location

11:05 am – 11:35 am GSO Empire
Bennett Goodman, Co-Founder GSO Capital Partners Lobby Level
Senior Managing Director, Blackstone
11:35 am – 11:55 am Wrap-Up Empire
Tony James, President & COO Lobby Level
11:55 am – 12:30 pm Q&A Empire
Steve Schwarzman, Chairman, CEO and Co-Founder Lobby Level
Tony James, President & COO
12:45 pm – 2:00 pm Seated Lunch Vanderbilt
Lobby Level
Blackstone 5
Table of Contents
I. Introduction
II. Welcome Remarks
III. Financials Overview
IV. Real Estate
V. Private Equity
VI. Portfolio Operations
VII. Advisory and Restructuring
VIII. BAAM
IX. GSO
X. Wrap-Up
Blackstone 6
I. Introduction
What’s new...
Historical Performance Fee-Earning AUM Total AUM

 AUM growth 28% per year(1) ($ in billions)
$218
 2.2x multiple on invested capital(2) $168
 10–18% returns for liquid funds(2) $171 Hedge Fund
$137 Solutions
$108
Credit
$90 $94
$78
$52 Real Estate

$37
$19 $23 $24

Private
$12
$8 $9 Equity
$1 $2 $6 $6
’95 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 Current
________________________________________________
(1) Represents growth in Total AUM from 1995 to present.
(2) Multiple on invested capital represents average multiple on realized investments from inception to present. Liquid returns represent a range of representative liquid strategies from their respective
inception dates to present.
Blackstone 1
What’s next…
Hypothetical Fee-Earning AUM
70% below our historic rate
($ in billions) $356
$171
If:
 8% AUM growth
 2x multiple on invested
capital
 7–10% liquid fund returns
Current 1 2 3 4 5 6 7 8 9 10
Years
Double actual current

Then: stock price Hypothetical Distributable Earnings
 $2.17 average cash
($ per diluted unit)
$3.20
earnings per year
Average Cash Earnings: $2.17
Implied stock price:
6% Yield $36
5% Yield $43
4% Yield $54
LTM 1 2 3 4 5 6 7 8 9 10
________________________________________________ Years
Note: Presentation of hypothetical growth in Fee Earning AUM and Distributable Earnings not intended to project future performance. Calculation of hypothetical Distributable Earnings per unit is intended
to be illustrative and for that purpose contains a number of assumptions including, among others, constant management and performance fee rates and margins over the ten year period, no change in
the number of diluted units outstanding over the ten-year period, a 2x realized multiple of invested capital over an average hold period of 4.5 years for our draw-down funds and an effective tax rate
of 15-20% on taxable income for the ten year period.
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If long-term growth is higher (but still well below trend)…

Hypothetical Fee-Earning AUM
What if AUM grows ($ in billions) $560
13% instead of 8%?
$171
Current 1 2 3 4 5 6 7 8 9 10
Years
Hypothetical Distributable Earnings Implied stock price:

($ per diluted unit)
$3.95 6% Yield $66
Average Cash Earnings: $2.50 5% Yield $79
4% Yield $99
LTM 1 2 3 4 5 6 7 8 9 10
________________________________________________
Years
Note: Presentation of hypothetical growth in Fee Earning AUM and Distributable Earnings not intended to project future performance. Calculation of hypothetical Distributable Earnings per unit is intended
to be illustrative and for that purpose contains a number of assumptions including, among others, constant management and performance fee rates and margins over the ten year period, no change in
the number of diluted units outstanding over the ten-year period, a 2x realized multiple of invested capital over an average hold period of 4.5 years for our draw-down funds and an effective tax rate
of 15-20% on taxable income for the ten year period.
Blackstone 3
II. Welcome Remarks
Blackstone is the largest alternative asset manager in the world,

with a diverse array of leading businesses
Private
Real
Equity
Estate
Credit
(GSO)
Pátria
1,800
employees
Park
Hill
25 offices
$218 billion
Advisory AUM
Hedge Fund
Solutions
Restructuring Tactical
Opportunities
Blackstone 1
These principles guide everything we do

These principles guide everything we do.
Integrity
Leadership demands
responsibility
Accountability Entrepreneurship
Using creativity to find
Our capital and reputation
opportunities others
are always on the line
overlook
Excellence Teamwork
Nothing less is ever
Always makes us better
acceptable
Blackstone 2
III. Financials Overview
Global leader in alternative asset management with $218 billion of AUM
Private Hedge Fund Financial

Real Estate Credit
Equity Solutions Advisory
$52 billion $59 billion $48 billion $58 billion
 Sustained Growth: $76 billion of Total AUM in new strategies or acquisitions since the IPO
 Value Creation: $17 billion of capital deployed and $18 billion of value gains over the last twelve months
 Gain Realization: generated $17 billion from over 115 transactions in the last twelve months
 Momentum: Performance Fee “compounding” and increase in realizations impacting financial results
Note: AUM = Total AUM as of 3/31/13. Blackstone 1

Blackstone’s growth centers on value creation and gain realization for fund
investors seeking long-term outperformance across cycles
Institutional
$23 billion Investors
pension funds, governments
$34 billion
1Q’13 LTM Capital Returned 1Q’13 LTM Capital Raised
and universities
Long-Term
Sustained Commitments
match liquidity to
Outperformance investment opportunities
across all businesses, across asset classes
funds and cycles
$18 billion $17 billion

1Q’13 LTM Value Created 1Q’13 LTM Invested / Committed
Create Value Provide Capital

an operational model geared to opportunities across
to value and job creation regions, strategies and stages
Blackstone 2
Since 2009, Total AUM has grown at a faster rate than Fee-Earning AUM,
reflecting an acceleration in value creation across Blackstone funds
Assets Under Management

($ in billions)
Total AUM
$242.2
25% Fee-Earning AUM

$180.2
12%
$98.2
$96.1 17%
$69.5
$54.8
21%
2006 2007 2008 2009 2010 2011 2012 1Q’13

Annualized
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As value creation accelerates, it drives Performance Fees and Realizations,

which both reached an “inflection point” over the last twelve months
Total Invested and Realized

($ in billions)
$16.7
$11.2
$13.1 $47.1 billion
Cumulative Realizations since 2007
$7.8
$5.2
$2.8
$1.0
$3.8
$7.6 $7.9
$88.5 billion
1Q’13 Fair Value of Performance
Fee Eligible AUM
$14.3
$16.2 $14.8 $15.6
2007 2008 2009 2010 2011 2012 1Q’13 LTM
Invested Realizations Net Realizations
Blackstone 4
Performance Fee-Earning AUM has quadrupled since 2010, driven by strong

inflows and the “compounding effect” of fund performance
Performance Fee-Earning AUM

($ in billions)
122%
CAGR for Drawdown Funds
$88.5 including Value Created(1)
Value Created(1) in
$13.6 Drawdown Funds
3.9x
$39.6
Drawdown
Funds at Cost
95%
CAGR for Drawdown Funds at Cost
$22.7
$8.8 $35.3 NAV Funds
$13.8 52%
CAGR for NAV Funds
2010 1Q’13
(1) Value Created represents the unrealized market appreciation of drawdown funds. Blackstone 5
Realized Performance Fees are rapidly approaching pre-crisis levels while

an increasingly diverse AUM base has continued to scale
Realized Performance Fees Fee-Earning AUM

($ in billions)
($ in millions)
$171
$168
$131 billion
$1,055 1Q’13 Performance Fee Eligible AUM
$995
$916 $137 $929
$110 77%
$629 of invested Performance Fee Eligible
$96
$91 AUM above high water mark / hurdle at 1Q’13
$83
$362
$322
$55 $228 $34 billion
$133 $38 1Q’13 Performance Fee Eligible Dry Powder
$74
$39
$24
$23
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 1Q’13
LTM
Private Equity Real Estate Hedge Fund Solutions Credit
Blackstone 6
Realization activity is driving a shift in the earnings mix towards a greater

percentage of cash generation while value creation remains robust
Economic Income
($ in millions)
$2,179
$2,041 40%
Economic Income CAGR since 2009
$1,581 $1,585 $793

$875
$830 $814
34%
cash flow components(1)
$695 CAGR since 2009
$724 $466
$194 $272 $225

$69
$461 $478 $546

$700 $691 64%
of earnings related to cash flow
components(1), up from 47% in 2010
2009 2010 2011 2012 1Q’13 LTM
Fee Related Earnings Net Realizations Net Unrealized
Totals may not add due to rounding. See Appendix – Earnings Composition – Calculation of Net Realizations and Net Unrealized. Blackstone 7
(1) Cash flow components include Net Realizations and Fee Related Earnings.
Sustained investment performance strengthens an already high quality balance

sheet with low levels of debt, high equity base and strong free cash flow
$5.93 Total Net Asset Value

(Cash and Investments per DE Unit)
$1.5 billion
$5.93 cumulative distributions to unitholders
over the last two years
+42%
Total Cash and

$4.17 $1.96
Treasury Investments
$2.2 billion
$1.52 $0.80 Private Equity 1Q’13 Net Accrued Performance
Fee Receivable
$0.99 Real Estate
$0.74
$0.18 Other Investments
$0.72
$0.23 Net Accrued
$0.96
$2.00
Performance Fees A / A+ rated
by S&P / Fitch
1Q’11 1Q’13
Blackstone 8
Blackstone’s competitive positioning, operating fundamentals and secular

growth trends have not translated into a higher multiple… yet
 Secular Trends: Alternatives are the Cumulative Asset Growth(1)
fastest growing segment in asset 202%
management by a wide margin
16x
 Market Dynamics: Barriers to entry

increasing as track record and investment 12%
platform dictate returns
Traditional BX
BX
Managers
 Competitive Position: Within
alternatives, Blackstone is gaining share
and outpacing the segment 2007 P/E Multiple(3) Current P/E Multiple(3)
19x
15x 16x
Cash Yield Operating Margin (2)
9x
2% / 5% 33% / 50%
Traditional BX Traditional BX
Managers Managers
Traditional BX Traditional BX
Managers Managers
Source: Morgan Stanley, Citigroup.
(1) Based on Total AUM growth from 12/31/06 to 12/31/12. Traditional Managers’ growth excludes Blackrock’s acquisition of Barclays Global Investors. Blackstone 9
(2) Operating Margins reflect 2012 earnings margin for traditional asset managers and 2012 ENI margin for Blackstone.
(3) Valuation multiples reflect consensus earnings estimates for traditional asset managers and consensus ENI estimates for Blackstone.
Blackstone is uniquely positioned to capitalize on global opportunities to

create value for our fund investors and Blackstone Unitholders
Balanced & Strong

Opportunistic Best-in-Class
Diverse Operating
Capital Growth
Business Fundamentals
Uniquely positioned as the Each business continues 50% operating margins, Blackstone has grown
provider of choice to to innovate ways to create strong and consistent Total AUM 4 times faster
create long-term value value and revenue streams cash flow from Fee than traditional managers
across alternative asset through synergies with Related Earnings and a since 2009 and 16 times
classes and liquidity core expertise and product “compounding effect” faster since 2006
profiles lines on Performance Fees
Blackstone 10
Appendix
GAAP Statement of Operations

($ in thousands) 2008 2009 2010 2011 2012 1Q'13 LTM
Revenues
Management and Advisory Fees, Net $ 1,476,357 $ 1,482,226 $ 1,584,748 $ 1,811,750 $ 2,030,693 $ 2,041,150
Performance Fees
Realized Carried Interest 244,963 138,907 327,422 608,032
Realized Incentive Fees 121,758 90,099 301,801 320,263
Realized 38,941 70,492
Unrealized Carried Interest 457,002 971,518 994,190 872,741
Unrealized Incentive Fees 114,111 (17,864) (30,361) 8,302
Unrealized (1,286,261) 150,598
Total Performance Fees (1,247,320) 221,090 937,834 1,182,660 1,593,052 1,809,338
Investment Income (Loss)
Realized (16,425) 44,320 29,157 87,542 93,963 119,981
Unrealized (606,452) (3,716) 532,004 125,781 256,231 289,635
Total Investment Income (Loss) (622,877) 40,604 561,161 213,323 350,194 409,616
Interest and Dividend Revenue 30,879 22,680 36,218 37,427 40,354 45,275
Other 13,600 7,099 (619) 7,416 5,148 8,499
Total Revenues (349,361) 1,773,699 3,119,342 3,252,576 4,019,441 4,313,878
Expenses
Compensation and Benefits
Compensation 4,062,238 3,778,686 3,253,226 2,421,712 2,091,698 2,047,873
Performance Fee Compensation
Realized Carried Interest 70,716 43,615 96,433 177,932
Realized Incentive Fees 57,600 55,912 140,042 146,298
Realized 4,997 25,102
Unrealized Carried Interest 165,340 237,945 321,599 332,528
Unrealized Incentive Fees 63,307 (20,759) (44,528) (12,829)
Unrealized (207,448) (26,182)
Total Compensation and Benefits 3,859,787 3,777,606 3,610,189 2,738,425 2,605,244 2,691,802
General, Administrative and Other 440,776 443,573 466,358 566,313 548,738 515,278
Interest Expense 23,008 13,384 41,229 57,824 72,870 85,414
Fund Expenses 63,031 7,296 26,214 25,507 33,829 19,495
Total Expenses 4,386,602 4,241,859 4,143,990 3,388,069 3,260,681 3,311,989
Other Income (Loss)
Reversal of Tax Receivable Agreement Liability - - - 197,816 - -
Net Gains (Loss) from Fund Investment Activities (872,336) 176,694 501,994 14,935 256,145 35,213
Income (Loss) Before Provision (Benefit) for Taxes $ (5,608,299) $ (2,291,466) $ (522,654) $ 77,258 $ 1,014,905 $ 1,037,102
Provision (Benefit) for Taxes (14,145) 99,230 84,669 345,711 185,023 197,263
Net Income (Loss) $ (5,594,154) $ (2,390,696) $ (607,323) $ (268,453) $ 829,882 $ 839,839
Net Income (Loss) Attributable to Redeemable Non-Controlling Interests in Consolidated Entities (632,495) 131,097 87,651 (24,869) 103,598 111,655
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities (159,828) (14,328) 343,498 7,953 99,959 (107,136)
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings (3,638,799) (1,792,174) (668,444) (83,234) 407,727 507,412
Net Income (Loss) Attributable to The Blackstone Group L.P. $ (1,163,032) $ (715,291) $ (370,028) $ (168,303) $ 218,598 $ 327,908
Blackstone 12
Total Segments
Revenues
Management and Advisory Fees, Net
Base Management Fees $ 1,041,718 $ 999,829 $ 1,069,471 $ 1,281,185 $ 1,591,403 $ 1,604,644
Advisory Fees 397,519 390,718 426,140 382,240 357,417 348,591
Transaction and Other Fees, Net(1) 96,358 115,040 137,748 247,513 227,119 226,622
Management Fee Offsets(2) (16,437) (17,161) (2,313) (33,393) (40,953) (37,565)
Total Management and Advisory Fees, Net 1,519,158 1,488,426 1,631,046 1,877,545 2,134,986 2,142,292
Performance Fees
Realized Carried Interest 26,953 29,452 244,963 138,907 327,422 608,032
Realized Incentive Fees 12,060 44,812 116,700 89,029 301,464 320,912
Unrealized Carried Interest (1,274,327) 100,304 457,002 971,518 994,190 872,741
Unrealized Incentive Fees (11,935) 65,563 107,624 (24,928) (29,311) 10,323
Total Performance Fees (1,247,249) 240,131 926,289 1,174,526 1,593,765 1,812,008
Investment Income (Loss)
Realized (64,677) 29,544 46,915 102,575 95,398 110,016
Unrealized (691,934) 3,880 501,634 82,689 190,846 227,593
Total Investment Income (Loss) (756,611) 33,424 548,549 185,264 286,244 337,609
Interest Income and Dividend Revenue 29,014 22,492 36,096 38,844 46,630 51,946
Other 13,595 7,096 (618) 7,415 5,149 8,499
Total Revenues (442,093) 1,791,569 3,141,362 3,283,594 4,066,774 4,352,354
Expenses
Compensation 771,426 769,856 859,114 960,569 1,030,776 1,042,981
Performance Fee Compensation
Realized Carried Interest (1,421) 2,844 70,716 43,615 96,433 177,932
Realized Incentive Fees 6,418 22,260 57,600 55,912 140,042 146,298
Unrealized Carried Interest (204,262) (69,824) 165,340 237,944 321,599 332,528
Unrealized Incentive Fees (3,452) 43,641 63,306 (20,759) (44,528) (12,829)
Total Compensation and Benefits 568,709 768,777 1,216,076 1,277,281 1,544,322 1,686,910
Other Operating Expenses 319,216 299,029 344,516 421,342 481,445 486,368
Total Expenses 887,925 1,067,806 1,560,592 1,698,623 2,025,767 2,173,278
Economic Income (Loss) $ (1,330,018) $ 723,763 $ 1,580,770 $ 1,584,971 $ 2,041,007 $ 2,179,076
(1) Transaction and Other Fees, Net, are net of amounts, if any, shared with limited partners including, for Private Equity, broken deal expenses. Blackstone 13
(2) Primarily placement fees.
Reconciliation of GAAP to Non-GAAP Measures

Net Income (Loss) Attributable to The Blackstone Group L.P. $ (1,163,032) $ (715,291) $ (370,028) $ (168,303) $ 218,598 $ 327,908
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings (3,638,799) (1,792,174) (668,444) (83,234) 407,727 507,412
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities (159,828) (14,328) 343,498 7,953 99,959 (107,136)
Net Income (Loss) Attributable to Redeemable Non-Controlling
Interests in Consolidated Entities (632,495) 131,097 87,651 (24,869) 103,598 111,655
Net Income (Loss) $ (5,594,154) $ (2,390,696) $ (607,323) $ (268,453) $ 829,882 $ 839,839
Provision (Benefit) for Taxes (14,145) 99,230 84,669 345,711 185,023 197,263
Income (Loss) Before Provision (Benefit) for Taxes $ (5,608,299) $ (2,291,466) $ (522,654) $ 77,258 $ 1,014,905 $ 1,037,102
IPO and Acquisition-Related Charges(1) 3,331,722 2,973,950 2,369,195 1,269,932 1,079,511 1,021,576
Amortization of Intangibles(2) 153,237 158,048 165,378 220,865 150,148 124,917
Other Adjustments 999 - - - - -
(Income) Loss Associated with Non-Controlling Interests in (Income) Loss of
Consolidated Entities(3) 792,323 (116,769) (431,149) 16,916 (203,557) (4,519)
Economic Income (Loss) $ (1,330,018) $ 723,763 $ 1,580,770 $ 1,584,971 $ 2,041,007 $ 2,179,076
Taxes(4) (43,457) (51,086) (28,932) (45,763) (45,708) (46,688)
Economic Net Income (Loss) $ (1,373,475) $ 672,677 $ 1,551,838 $ 1,539,208 $ 1,995,299 $ 2,132,388
(4)
Taxes 43,457 51,086 28,932 45,763 45,708 46,688
(5)
Performance Fee Adjustment 1,247,249 (240,131) (926,289) (1,174,526) (1,593,765) (1,812,008)
Investment (Income) Loss Adjustment(6) 756,611 (33,424) (548,549) (185,264) (286,244) (337,609)
(7)
Investment Income - Blackstone's Treasury Cash Management Strategies - 12,367 15,277 4,600 25,769 17,730
(8)
Performance Fee Compensation and Benefits Adjustment (202,717) (1,079) 356,962 316,712 513,546 643,929
Fee Related Earnings $ 471,125 $ 461,496 $ 478,171 $ 546,493 $ 700,313 $ 691,118
Realized Performance Fees(9) 34,016 49,160 233,347 128,409 392,411 604,714
Realized Investment Income (Loss)(10) (64,677) 29,544 46,915 102,575 95,398 110,016
Adjustment Related to Realized Investment Income -
Blackstone's Treasury Cash Management Strategies(11) - (10,142) (7,782) (6,057) (21,872) (19,795)
Taxes and Related Payables Including Payable Under Tax Receivable Agreement(12) (43,457) (51,086) (48,867) (74,696) (132,325) (135,422)
Distributable Earnings $ 397,007 $ 478,972 $ 701,784 $ 696,724 $ 1,033,925 $ 1,250,631
Interest Expense 19,992 10,238 36,666 53,201 69,152 81,667
(12)
Taxes and Related Payables Including Payable Under Tax Receivable Agreement 43,457 51,086 48,867 74,696 132,325 135,422
Depreciation and Amortization 19,639 23,750 26,629 32,764 42,235 40,610
Adjusted EBITDA $ 480,095 $ 564,046 $ 813,946 $ 857,385 $ 1,277,637 $ 1,508,330
See Appendix – Reconciliation of GAAP to Non-GAAP Measures – Notes for details. Blackstone 14
Reconciliation of GAAP to Non-GAAP Measures – Notes

Note: See Appendix – Definitions.
(1) 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.
(2) 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.
(3) This adjustment adds back to Income (Loss) Before Provision (Benefit) for Taxes the amount of (Income) Loss Associated with Non-
Controlling Interests in (Income) Loss of Consolidated Entities and includes the amount of Management Fee Revenues associated
with Consolidated CLO Entities.
(4) Taxes represent the current tax provision (benefit) calculated on Income (Loss) Before Provision for Taxes.
(5) This adjustment removes from EI the total segment amount of Performance Fees.
(6) This adjustment removes from EI the total segment amount of Investment Income (Loss).
(7) This adjustment represents the realized and unrealized gain on Blackstone’s Treasury cash management strategies which are
a component of Investment Income (Loss) but included in Fee Related Earnings.
(8) This adjustment removes from expenses the compensation and benefit amounts related to Blackstone’s profit sharing plans related
to Performance Fees.
(9) Represents the adjustment for realized Performance Fees net of corresponding actual amounts due under Blackstone’s profit
sharing plans related thereto.
(10) Represents the adjustment for Blackstone’s Investment Income (Loss) – Realized.
(11) Represents the elimination of Realized Investment Income attributable to Blackstone’s Treasury cash management strategies which
is a component of both Fee Related Earnings and Realized Investment Income (Loss).
(12) Taxes and Related Payables Including Payable Under Tax Receivable Agreement represent the current tax provision (benefit)
calculated on Income (Loss) Before Provision for Taxes and the Payable Under Tax Receivable Agreement.
Blackstone 15
Earnings Composition – Calculation of Net Realizations and Net Unrealized
($ in thousands) 2009 2010 2011 2012 1Q'13 LTM
Realized Incentive Fees $ 44,812 $ 116,700 $ 89,029 $ 301,464 $ 320,912

Less: Realized Incentive Fee Compensation (22,260) (57,600) (55,912) (140,042) (146,298)
Net Realized Incentive Fees 22,552 59,100 33,117 161,422 174,614
Realized Carried Interest 29,452 244,963 138,907 327,422 608,032
Less: Realized Carried Interest Compensation (2,844) (70,716) (43,615) (96,433) (177,932)
Net Realized Carried Interest 26,608 174,247 95,292 230,989 430,100
Realized Investment Income 29,544 46,915 102,575 95,398 110,016
Adjustment Related to Realized Investment Income - Blackstone's Treasury Cash Management Strategies (1) (10,142) (7,782) (6,057) (21,872) (19,795)
Net Realized Investment Income 19,402 39,133 96,518 73,526 90,221
Net Realizations $ 68,562 $ 272,480 $ 224,927 $ 465,937 $ 694,935
Unrealized Incentive Fees $ 65,563 $ 107,624 $ (24,928) $ (29,311) $ 10,323

Less: Unrealized Incentive Fee Compensation (43,641) (63,306) 20,759 44,528 12,829
Net Unrealized Incentive Fees 21,922 44,318 (4,169) 15,217 23,152
Unrealized Carried Interest 100,304 457,002 971,518 994,190 872,741
Less: Unrealized Carried Interest Compensation 69,824 (165,340) (237,944) (321,599) (332,528)
Net Unrealized Carried Interest 170,128 291,662 733,574 672,591 540,213
Unrealized Investment Income 3,880 501,634 82,689 190,846 227,593
(1)
Less: Investment Income - Blackstone's Treasury Cash Management Strategies (12,367) (15,277) (4,600) (25,769) (17,730)
Less: Adjustment Related to Realized Investment Income - Blackstone's Treasury Cash Management Strategies (1) 10,142 7,782 6,057 21,872 19,795
Net Unrealized Investment Income 1,655 494,139 84,146 186,949 229,658
Net Unrealized $ 193,705 $ 830,119 $ 813,551 $ 874,757 $ 793,023
Unless otherwise noted, all amounts are the respective captions from Appendix – Total Segments. Blackstone 16
(1) See Appendix – Reconciliation of GAAP to Non-GAAP Measures and the related notes for these adjustments.
Definitions
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 five 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”, as a key measure to highlight earnings from operations excluding: (a) the income related
to performance fees and related carry plan costs, (b) income earned from Blackstone’s investments in the Blackstone Funds, and
(c) realized and unrealized gains (losses) from other investments except for such gains (losses) from Blackstone’s Treasury cash
management strategies. 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, investment income from
Blackstone’s Treasury cash management strategies and interest income, 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) other 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, (b) Realized Performance Fee Compensation, (c) Other Operating Expenses, and (d) Taxes and
Related Payables Including the Payable Under 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”, as a measure of
segment performance and an indicator of its ability to cover recurring operating expenses. Adjusted EBITDA equals DE before segment
interest expense, segment depreciation and amortization, and the taxes and related payables including the Payable Under Tax Receivable
Agreement.
Blackstone 17
IV. Real Estate
Blackstone Real Estate Overview
 Blackstone Real Estate

• $59 Billion AUM
• 16% Net Returns over 20+ Years(1)
• Only 1% Realized Losses
• $23 Billion of Capital Deployed Post-Crisis(2)
 Keys to Success
• Same Simple Strategy – Buy it, Fix it, Sell it
• Same Investment Process
• Same People
 Current Environment
• Compelling Investment Opportunities Globally
• Competitive Landscape Radically Altered
• Limited New Construction
Note: Past performance is not necessarily indicative of future results. See “Important Disclosures” section at the front of the presentation book. Blackstone 1
(1) BREP global funds include Pre-BREP, BREP I, BREP II, BREP III, BREP IV, BREP V, BREP VI and BREP VII; excludes BREP regional funds, co-investments and BREDS.
(2) Reflects invested and committed capital.
Blackstone Real Estate Partners (“BREP”) has consistently delivered solid

performance since 1991
BREP Global Funds as of March 31, 2013

($ in thousands)
Investment Invested BREP

Fund Period Capital Net IRR(1)
Pre-BREP '91-94 140,714 33%
BREP I '94-96 467,168 40%
BREP II '96-99 1,218,877 19%
BREP III '99-03 1,415,422 21%
BREP IV '03-06 2,737,219 13%
BREP V '06-07 5,756,971 9%
BREP VI '07-11 10,749,611 10%
BREP VII '11- 5,457,415 32%
Total $27,943,396 16%

(1) Net returns reflect realized proceeds and unrealized carrying values with no projections of future appreciation and are net of carry, management fees, organizational costs and
partnership expenses.
Investment success has translated into remarkable fundraising success with

over $40 billion raised since 2007
Fund Closing Date Size ($bn)

BREP VII 2012 13.3
BREP Europe III 2008 4.4
BREP VI 2007 10.9
Fee Paying Co-Invest 2007-13 4.6
BREP Total Raised $33.2
BREDS II 2013 2.0
BREDS I 2009 2.8
BREDS Liquid 2008-13 1.0
Fee Paying Co-Invest 2010-11 1.7
BREDS Total Raised $7.4
Blackstone Real Estate Fundraising Total 2007-13 $40.6

 Chart above excludes AUM from BAML Asia and Capital Trust acquisitions as well as
pending fundraises not yet closed
Note: Past performance is not necessarily indicative of future results. There can be no assurance that any Blackstone fund will achieve its objectives or avoid losses. Blackstone 3
See “Important Disclosures” section at the front of the presentation book.
Assets under management have grown tremendously since 2005 despite the
sharp downturn
Fee Earning Real Estate AUM Total Real Estate AUM

($ billions) ($ billions)
$59
1Q ’13
$42
1Q ’13
+765%
+631%
$6 $7
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Blackstone 4
Key Questions about Blackstone Real Estate
Key Questions about Blackstone Real Estate
 Why Such Significant Capital Deployment?

• In Single Family Housing?
• In Asia?
• In Europe?
 Will You and Can You Exit Current Holdings?
 Is Blackstone Real Estate Too Big to Keep Growing?
Blackstone 6
Why Such Significant Capital Deployment?
Global credit crisis profoundly weakened economic growth, employment,

sovereign balance sheets and large financial institutions
GDP Growth ’06 vs. ’12(1) Unemployment ’06 vs. Today(2)

12.7% 12.0%
9.4%
7.7%
7.8% 6.9%
4.4%
4.0%
2.7% 2.2% 2.5%
0.0%
China India U.S. France U.S. Eurozone
Annual Deficits ’06 vs. ’12(3) Bank Stocks Pre-Crisis vs. Today(4)
10.4% Asia Bank U.S. Bank Europe Bank
8.6% Index Index Index
7.8%
5.6%
4.6%
2.4% 2.3% -24%
1.2%
-54%
-69%
U.S. U.K. France Japan
(1) International Monetary Fund as of year end 2012. (3) IHS Global Insight estimated as of year end 2012. Blackstone 7
(2) BLS, EU official statistics agency as of February 2013. (4) As of March 31, 2013. U.S.– BKX Bloomberg Index, Asia – Stoxx SXA83P Index , Europe – Stoxx SX7P Index.
Global credit crisis also caused enormous dislocation in the commercial real
estate industry
Major Financial Institutions Have Exited or
CMBS Loans in Special Servicing(1)
(% of Current Balance) Downsized Opportunistic Real Estate Investing
8.3%
0.2%
’99 ’01 ’03 ’05 ’07 ’09 ’11 ’13

U.S. CMBS Issuance(2) Europe CMBS Issuance(3)
($Bn) (€Bn)
$229 €69 €66
$198
€25
$48
$33 €8
$12 $12 €5 €4
$3 €2
’06 ’07 ’08 ’09 ’10 ’11 ’12 ’06 ’07 ’08 ’09 ’10 ’11 ’12
(1) JP Morgan research, March 2013. Blackstone 8
(2) Commercial Mortgage Alert/BAML as of December 2012.
(3) Barclays as of December 2012.
The credit crisis dramatically reduced real estate private equity fundraising
competition across the globe
Real Estate Private Equity Fundraising 2008 vs. 2012(1)

(in billions)
United States Europe Asia

$71 €31 $31
45%
74% 72%
$40
€8 $9
2008 2012 2008 2012 2008 2012
(1) Preqin, 4Q 2012. Blackstone 9

The credit crisis also significantly reduced new construction of real estate
New Office Building Completions

(mm square feet)
Beijing London New York

15.5
6.4
83% 64%
2.6
99%
2.3
2.6
0.0
2007 2012 2009 2012 2008 2012
Source: As of year end 2012. Beijing, Knight Frank. London, CBRE. New York, CBRE. Blackstone 10
Fallout from credit crisis has and continues to create compelling distressed
investment opportunities for Blackstone Real Estate
Investment Decline from

Investment Region Year Description Pre-Crisis Value
Broadgate Europe 2009 Corp Deleveraging 56%
U.S. 2010 Bankruptcy 50%
U.S. 2010 Bankruptcy 38%
Asia 2011 Distressed Public Co. 60%
Europe 2012 Foreclosure Sale 77%
Asia 2012 Foreclosure Sale 50%
U.S. 2012/13 Foreclosure Sales 50%
Note: Represents BREP’s assessment of the discount to pre-crisis value. There is no assurance that these investments will be profitable or avoid losses. The examples cited herein may Blackstone 11
not be representative of all investments made by Blackstone, both with respect to performance and operating metrics, and it should not be assumed that Blackstone will make
equally successful or comparable investments in future funds.
Why Invest in Single Family Housing?
BREP single family housing strategy was based on attractive acquisition

basis and significant decline in new supply
Invitation Homes – Average Purchase Price U.S. Single Family Housing Completions(2)
Units (thousands)
$303K(1)
1,979
Down 50%
Down 67%
$153K
649
2006 BREP Price

(1) Represents estimated value of bought homes. Blackstone 12
(2) Census Bureau, February 2013.
Why Invest in Asia?
Asia continues to grow but dislocated capital markets have greatly reduced
capital flows to real estate
Strong Asia Real Estate Fundamentals…(1) …But Lack of Capital to Support Growth(2)
Office Market Net Absorption 2011-12 Real Estate Public Company Equity Issuance ($mm)
9.2%
$21,589
8.4%
Down 84%
$3,351
0.4% 0.5%
London New York Shanghai Mumbai 2008 2012

China India
(1) CBRE Research – 2012. Blackstone 13

(2) Thomson Financial research, September 2012.
Why Invest in Europe?
European banks remain significantly overleveraged and have enormous

amounts of commercial real estate debt on balance sheet
Overleveraged Banks(1) Deleveraging of Real Estate Just Starting(2)

European banks have 2-3x the leverage of U.S. banks €2.4 trillion of CRE debt on European bank balance sheets
45x
€2,400
40x
24x
14x
€140
U.S. U.K. France Germany CRE Loans Deleveraging to Date
(1) Barclays Capital research 2012; U.S. includes GSE and banking system assets. Blackstone 14
(2) Morgan Stanley “Banks Deleveraging and Real Estate” November 2012.
Will You and Can You Exit Current Holdings?
Patience to date has been rewarded: BREP investments have seen

a substantial recovery in performance
EBITDA: 2009 vs. 2013F Occupancy: 2010 vs. 2013F
+58% +810bps
Note: The examples cited herein may not be representative of all investments made by Blackstone, both with respect to performance and operating metrics, and it should not be Blackstone 16
assumed that Blackstone will make equally successful or comparable investments in future funds. Past performance is not necessarily indicative of future results. See
“Important Disclosures” section at the front of the presentation book.
Our strategy of holding assets through the crisis and aggressively deploying
capital since 2009 has resulted in significant gains to date
Multiple of BX Net
($ millions) Invested Capital(1) Accrued Carry(2)
Fund 4Q ’09 1Q ’13 4Q ’09 1Q ’13
BREP VI 0.5x 1.6x $0 $681
BREP V 0.9x 1.7x 0 490
BREP VII - 1.3x - 133
BREP Europe III 1.0x 1.4x 0 93
BREP/BREDS Other - - 3 49
TOTAL $3 $1,446
________________________________________________
Note: Past performance is not necessarily indicative of future results. There can be no assurance that any Blackstone fund will achieve its objectives or avoid losses. See “Important Disclosures” section at the
front of the presentation book.
(1) Figures represent realized and unrealized gross MOICs. Net IRR's as of March 31, 2013 are: BREP VII 32%, BREP VI 10%, BREP V 9%, BREP Europe III 19%.
(2) Net accrued carry includes co-investment capital for respective funds and is net of performance fee compensation.
Blackstone 17
As a result of improving operations and real estate capital markets,

Blackstone has begun to greatly increase distributions to limited partners
Blackstone Real Estate Gross Distributions

($ millions)
$3,708
$1,848
$932
+86%
$501
$681
$213
$30
2008 2009 2010 2011 2012 1Q ’12 1Q ’13
Exits will be aided by two key trends: i) low cost of capital for public companies
and ii) sovereign wealth funds increased appetite for high quality real estate
Public Company Debt Costs Significant Recent SWF Transactions(2)

($ millions)
Bond
Company Sector Yields(1) Buyer City Sale Price
Retail 2.8% Norway London $1,220
Norway NY/BOS/DC 1,200

Apartments 3.0%
Singapore San Francisco 910
Retail 3.0%
Qatar Paris 770
Office 3.0% Canada New York 735
China London 720

Industrial 3.0%
Hong Kong Paris 650
Healthcare 3.1% Qatar London $540
________________________________________________
(1) Yield-to-Worst as of April 5, 2013. Bond maturities between 7 – 10 years.
(2) Knight Frank, CBRE, Eastdil – March 2013.
The examples cited herein may not be representative of all investments made by Blackstone, both with respect to performance and operating metrics, and it should not be assumed that Blackstone will make
equally successful or comparable investments in future funds.
Blackstone 19
Is Blackstone Real Estate Too Big to Keep Growing?
Blackstone Real Estate Debt Strategies (“BREDS”) was formed in 2008 as

a lender to take advantage of dislocated real estate debt markets
BREDS Total AUM(1) BREDS Summary

($ billions)
$9bn  BREDS I
• 13.4% Net IRR since inception
Through
April ’13
 BREDS Liquid
• Net IRR since inception:
― BSSF 13.2%, CMBS 12.6%
 BREDS II
• $2bn closed on April 9, 2013
• $3bn target fundraise
 Capital Trust / Blackstone

Mortgage Trust
$0 • Acquired manager December ’12
2007 2008 2009 2010 2011 2012
• New offering filed March ’13
(1) AUM includes $2.0 billion of capital from the BREDS II initial closing on April 9, 2013.
BREP was disciplined deploying capital prior to the financial crisis in Asia but
has significantly increased investment since 2010
Blackstone Real Estate BREP Asia Summary

Asia Investments $1.7  BREP Asia
($ billions)
• 47 real estate professionals in 6 Asia offices
• $1.7bn invested in the region
• 15% Net IRR since inception(1)
 Bank of America Merrill Lynch Asia

• Blackstone assumed management of BAML
Asia’s $2bn of real estate assets in 2010
BREP Opens
First Asia  BREP Asia Fund
Office
• First close targeted in 2Q 2013
• $4bn target size
2006 2007 2008 2009 2010 2011 2012 2013

________________________________________________
(1) Excludes Sanwa Bank Loan (~$6 million) and Paliburg Holdings (~$15 million) investments as these were made in 1998, almost 9 years prior to Blackstone Real Estate having any presence in Asia.
Note: Past performance is not necessarily indicative of future results. There can be no assurance that any Blackstone fund will achieve its objectives or avoid losses. See “Important Disclosures” section at the
front of the presentation book.
Blackstone 22
Blackstone Real Estate Key Takeaways
 Performance Drives Business

Current Global Fund
• BREP VII: 32% Net IRR
Fully Invested Global Funds
• BREP VI: 1.6x
• BREP V: 1.7x
• BREP IV: 1.5x
 Capital Deployment Remains Robust

• Invested Since ’09: $23 billion
• Dry Powder(1): $12 billion + Recycling Ability
 Fundraising
• Raised Since ’07: $40+ billion
• In Market: BREP Asia, BREDS II, & Capital Trust
 Accelerating Dispositions(2)
• Distributions: Up 86% in 1Q ’13
• Performance Fees: Up 8x in 1Q ’13
• Outlook: Pick up expected in 2013-15
Net IRR’s as of March 31, 2013 are: BREP VI 10%, BREP V 9%, BREP IV 13%.
(1) Includes $2.0bn of BREDS II capital closed on April 9, 2013.
(2) Distributions and performance fees vs. 1Q ‘12. Performance fees are realized only and gross of performance fee compensation.
V. Private Equity
What defines us?
 Strategy
• Only invest when we can create value
• Flexible investment mandate in terms of region, sector or transaction type

• Single Global fund for general Private Equity and Energy investing – one
investment committee weighing risk / reward globally
• Leverage intellectual capital from all Blackstone businesses
 Global reach
• Offices on 3 continents
• 33 SMDs and 126 Investment Professionals around the globe
• Portfolio of 75 companies generating a cumulative $109B of revenue,

employing over 734,000 people
Blackstone 1
What defines us? (cont’d)
 Portfolio Operations capability

• 23 professionals dedicated to driving value creation at our companies
• Functional experts in key areas: supply chain, procurement, IT, healthcare,
and talent
• Company-specific non-executive board members – ex-CEOs with relevant
expertise
 Large-scale capital base
• $13.3B of dry powder between BCP V, BCP VI, and BEP
 Successful long-term track record(1)

• Gross IRR of 30%; Gross MOIC of 2.2x on realized investments
• Gross IRR of 24%; Gross MOIC of 1.7x on total funds since inception
________________________________________________
(1) Past performance is not necessarily indicative of future results. See “Important Disclosures” section at the front of the presentation book. Net IRR is 21% for realized investments and 15% for total
investments.
Blackstone 2
Overview of Private Equity’s key business lines
Blackstone Capital Blackstone Energy Tactical

Partners (“BCP”) Partners (“BEP”) Opportunities
 $12.4B of dry powder  $1.3B of dry powder  $2.2B of dry powder
 107 dedicated Investment  8 dedicated Investment  18 dedicated Investment

Professionals(1) Professionals Professionals
 75 portfolio companies(2) with  7 portfolio companies with  9 investments with $365M of
$29.0B of invested equity $593M of invested equity invested equity
 Key portfolio investments:  Key portfolio investments:  Key portfolio investments:
________________________________________________
Note: The examples cited herein may not be representative of all investments made by Blackstone, both with respect to performance and operating metrics, and it should not be assumed that Blackstone will
make equally successful or comparable investments in future funds.
(1) Including 8 BEP dedicated Investment Professionals.
(2) Including 7 BCP VI portfolio companies that are co-invested with BEP fund.
Blackstone 3
Overview of organization – Leading Private Equity franchise

Europe
4 Deal SMDs
21 Professionals
Asia
Sweden 7 Deal SMDs U.S.
29 Professionals 12 Deal SMDs
London 52 Professionals
Dublin Paris
Germany
San Francisco
Switzerland Beijing Blackstone Chicago Boston
Italy Headquarters Menlo Park
Istanbul
Seoul Dallas
Madrid New York
Private Equity Office
Shanghai Los Angeles
Mumbai Tokyo Atlanta
Hong Kong Affiliated Office Houston
Advisors
Singapore Sydney
Deal Sourcing / Execution Marketing Portfolio Operations

23 46 in BX’s 9 29 23 Operations Functional Experts
Deal SMDs Operational Network Country Advisors IRBD Professionals Professionals across Key Areas
 Supported by over  Sector specialists to  Senior Advisors to  Dedicated team to  Enables immediate  Supply Chain
100 Investment support deal bolster geographic maintain our critical and high-impact  Procurement
Professionals sourcing coverage Limited Partner intervention in
 IT / Outsourcing
Relationships operations of
portfolio companies  Healthcare benefits
to drive value  Pricing
creation  Talent Management
Blackstone 4
Blackstone has advantages compared to stand-alone

private equity firms: Expertise and deal sourcing beyond the
reach of any stand-alone private equity firm
Restructuring Corporate Real Credit / Hedge Fund

Advisory Advisory Estate GSO Solutions
Restructurings
involving over $1.3 Over $520 billion $59 billion $58 billion $48 billion
trillion of total of transactions AUM AUM AUM
liabilities
42 Investment 137 Investment 154 Investment 132 Investment 149 Investment

Professionals Professionals Professionals Professionals Professionals
Deal Sourcing / Bankruptcy Deal Sourcing / Corporate Real Estate Asset Joint Investing / Market Global Macro /
Investing / Restructuring Partnerships / Proprietary Optimization and Financing / Insights / Potential Access to Target Identification /
Process Insight Structured Equity Joint Investing Additional Debt Financing Public Market Insights
Private Equity benefits from

firm-wide
intellectual property
Blackstone 5
Blackstone Private Equity historical fund performance: We

have had consistently strong performance over 25 years(1)(2)
Closed Funds Investing Funds
2.6x 2.5x 2.7x

Total Gross MOIC
2.3x
1.9x
1.3x 1.3x 1.2x
BCP I BCP II BCP III BCOM BCP IV BCP V BCP VI BEP

(1987) (1993) (1997) (2000) (2002) (2006) (2011) (2011)
Gross IRRs 28.1% 49.9% 18.3% 12.1% 50.5% 5.3% 23.3% 95.1%
________________________________________________
Note: Past performance is not indicative of future results. See “Important Disclosures” section at the front of the presentation book. The examples cited herein may not be representative of all investments
made by Blackstone, both with respect to performance and operating metrics, and it should not be assumed that Blackstone will make equally successful or comparable investments in future funds.
(1) As of March 31, 2013 the net MOIC s and IRRs, respectively, are 2.0x and 88% for BEP, 1.1x and 9% for BCP VI, 1.2x and 4% for BCP V, 2.4x and 37% for BCP IV, 1.1x and 6% for BCOM, 1.9x and 14%
for BCP III, 2.1x and 32% for BCP II, and 1.9x and 19% for BCP I.
(2) Includes investments made by Blackstone’s Side-by-Side investment entities; excludes LP Co-investments and the portion of the investment funded with long-term financing.
Blackstone 6
Outstanding performance since 2012, with cumulative fund

performance of 18.9% Gross IRR and significant realizations
($ in millions)
1/1/12 – 3/31/13
Fund Realizations Gross IRR Capital Invested / Committed
BCP VI $260 29.9% $2,558
BEP 42 102.6% 906
(1)
BCP V 2,969 18.3% 418
BCP IV 2,244 11.8% 86
(2)
Total $5,889 18.9% $3,971
________________________________________________
Note: Represents gross IRRs as net MOIC and net IRR are not calculated on a deal by deal basis. Actual returns to investors will be reduced by fees and expenses. As of March 31, 2013, the gross and net IRRs,
respectively, are 23% and 9% for BCP VI, 95% and 88% for BEP, 5% and 4% for BCP V, 50% and 37% for BCP IV, 12% and 6% for BCOM, 18% and 14% for BCP III. Past performance is not indicative of
future results. See “Important Disclosures” section at the front of the presentation book. The examples cited herein may not be representative of all investments made by Blackstone, both with
respect to performance and operating metrics, and it should not be assumed that Blackstone will make equally successful or comparable investments in future funds.
(1) Includes ~$500 million of distribution received April 2013.
(2) Includes capital returned, capital invested, and IRR for BCOM, BCP III, and BCP II, as applicable. Excludes LP Co-Investments.
Blackstone 7
We are harvesting the value created throughout the cycle –

recent realizations at 2.8x Gross MOIC
IPOs / Equity Capital Market Activity Realizations
(Since 1/1/10) ($ in millions)
$5,188
$4,511 $585 April 2013
$3,453
$2,406
$4,603
Total Realized – $5.8B(1)

2010 2011 2012 1Q ’13 LTM
Total Gross MOIC – 2.8x(1)
________________________________________________
Note: Net MOIC and net IRR are not calculated on a deal by deal basis. Actual returns to investors will be reduced by fees and expenses. As of 3/31/2013, the net IRRs, respectively, 9% for BCP VI, 88%
for BEP, 4% for BCP V, 37% for BCP IV, 6% for BCOM, 14% for BCP III. Past performance is not indicative of future results. See “Important Disclosures” section at the front of the presentation book. The
examples cited herein may not be representative of all investments made by Blackstone, both with respect to performance and operating metrics, and it should not be assumed that Blackstone will
(1) Includes realization activity (including Co-Investments) for the above companies since 1/1/2010 through 3/31/2013.
Blackstone 8
Private Equity market since 2009
 Post-crisis private equity deals in the U.S. have been concentrated in sponsor-to-sponsor and take private deals
 We have found greater return opportunity in energy-related investments and platform deals
Overall Market Blackstone Capital Partners

Deals by Sector 2009–2013 YTD(1)
 Overweight Energy: 37%
TMT
23% Consumer / Retail
20%
Energy
8%  Underweight sponsor-to-sponsor and take privates
FIG /
Financial Services
Industrials 8%
26% Healthcare
14%
 Over 50% of capital deployed in growth equity,
Deals by Type 2009–2013 YTD(1) platforms, and energy development transactions
Other
1% Sponsor-to-
Carve-Out Sponsor
24% 39%
Private-to-Private
8%
Take Private
29%
________________________________________________
(1) Source: Goldman Sachs, Citi, and Bank of America Merrill Lynch as of April 2013: based on U.S. / Europe deals announced over $500 million TEV where values are available. Figures are by volume.
Excludes minority stake, Real Estate and Infrastructure Investments and 2013 Heinz and Dell Transactions.
Blackstone 9
We have exploited thematic opportunities in the post-crisis

period to create differentiated investments
Deal Theme Rationale BCP Companies
 Purchase assets at steep discounts to replacement cost

Cycle Plays
 Benefit from upswing in earnings
Natural Resource  North American non-conventional shale plays

Extraction  Natural gas exports
Non-Core Corporate  Undermanaged assets in which Blackstone can improve

Divestitures performance
 Rescue capital for banks with FDIC downside protection

Consumer
Banking  Banks exit from consumer lending market – creates
compelling opportunity for new capital
We have invested $9.7B since the financial crisis (mid-2008) of which approximately 40% or $3.7B
is already marked (realized + unrealized) at 2.7x cost
________________________________________________
Blackstone 10
Anatomy of a deal: (NYSE: SEAS)
Buy Add Value Realize

 InBev borrowed $50B to acquire  Carve out SeaWorld from AB – had  Comparable company trading
Anheuser-Busch (“AB”) in 2008 to create all stand-alone business multiples increased significantly
 After financial crisis, in order to functions during 2012
pay down debt, InBev compelled  Augment management team –  SeaWorld asset quality, unique
to sell certain assets non-Executive Chairman, CFO, visitor proposition and strong
 BCP has long track record owning creative talent, marketing talent financial performance attractive to
theme parks: proactively  Significant investment in new public investors
approached InBev in mid-2008 attractions, shows and park  SEAS IPO completed April 19,
 Initial BCP approach rebuffed, but infrastructure to drive growth pricing 29.9M shares at $27, top of
post-crisis, InBev entered into a  Revised pricing, food, beverage range, 1st day of trading stock
bi-lateral discussion with BCP and merchandise strategies to price rises 24% to $33.52
 BCP acquired SeaWorld for $2.4B drive revenue per capita  Together with dividends realized
(incl. fees) on December 1, 2009  EBITDA increase from $363M to prior to the IPO, BCP and its co-
for a multiple of 6.7x EBITDA $415M under BX private investors realized $1.1B and have a
ownership remaining stake in SeaWorld equal
to $1.9B, a gross MOIC(1) of 2.9x
________________________________________________
Note: This transaction may not be representative of past and future transactions and it should not be assumed that Blackstone will make equally successful or comparable investments in future funds.
Past performance of investments may not be indicative of future results. See “Important Disclosures” section at the front of the presentation book.
(1) Net MOIC is not calculated on a deal by deal basis. As of March 31, 2013, the net IRR for BCP V is 4%.
Blackstone 11
Current macro outlook for Private Equity
 Relative calm will prevail and equity markets will remain robust as liquidity washes in – we will
continue to sell into this market aggressively
 While we are in the midst of an economic recovery, growth will be structurally lower than in past
recoveries
• Fiscal deficit reduction an imperative
• Structurally higher tax rates a reality
• Consumer deleveraging still required
• Interest rates must go up eventually
 Unsustainably low interest rates / potential credit bubble
• New issue high yield coupons at historical lows
• Cheap credit benefits sellers not buyers
 Assuming these conditions persist indefinitely is dangerous!
• Assumptions concerning exit multiple and timing are critical and difficult to judge
• Must price in margin for error
Blackstone 12
Investment Philosophy
 We are not passive recipients of the “market return” for intermediated, transparent
private equity deals
 We must be able to intervene in our companies to change their fate and believe in one
or more of the following:
• Strategic repositioning – both organically and via acquisitions
• Operational restructuring (cost reductions, capital investments)
• A cyclical rebound about which we have proprietary insights
• An industry-wide or company-specific dislocation and/or distressed opportunity
• A portfolio company that makes us an advantaged buyer
• A corporate partnership that provides operational benefits or cheaper capital
Blackstone 13
Investment Philosophy (cont’d)
 Capital is scarce and precious – we are rewarded on investment performance, not $s at

work
• Avoid a “put money to work” mentality
 Unlevered returns matter: IRRs in more levered structures should be higher
 We should be bold in times of volatility and uncertainty
 We need to have an exit plan at the time we make our investments
• Discount IPO exits appropriately
• Pre-identify strategic acquirers and strategies to make our investee companies

attractive to them
 Excellent management is a key success factor
• We must be uncompromising about this
Blackstone 14
How we are investing in the current environment
 The current economic and financing environment has made the following
sectors attractive:
• Sectors / geographies in which the requirement for capital exceeds

its supply
• Sectors / geographies for which financing is difficult
• Cyclical opportunities
• Sectors in which structural change is driving higher than historical ROICs
• Sectors in which we can operate as strategic acquirors
Blackstone 15
BCP current investment themes

Selected Investments
 Energy / Natural Resources

• Continued need for capital to meet increasing global demand for energy
• Recently active in North American oil and gas E&P, infrastructure and renewables
• Backlog largely power-focused
 BX Innovation to drive growth

• Blackstone operating and strategic capabilities will drive next level of growth
 Deep Value / Special Situations

• Opportunistic investments combining sector expertise with ability to move
quickly
 Consumer Finance / Financial Technology

• Continued imbalance between supply and demand of consumer finance
• Innovative / disruptive technologies in the delivery of financial services
________________________________________________
Blackstone 16
What’s next?
 Significant undrawn capital in Private Equity – mission critical to continue to

invest it well
• Enormous earnings potential in these funds through the power of
carried interest
 Successor Energy and Global funds will be in the market over the next
few years
 Secondaries PE business with $9.0B of AUM recently acquired by BX
 New initiatives under review including growth equity, small-cap, and
sector-specific funds
 Strive to drive Blackstone’s Economic Income and Distributable Earnings
growth by consistently generating superior IRRs/MOICs on a large-scale annual
capital deployment
Blackstone 17
VI. Portfolio Operations
Our Mission: sustainable competitive advantage delivering

long-term value
 Blackstone’s Portfolio Operations Group supports investment teams in
identifying and quantifying opportunities for strategic and operational
improvement in companies in which we are considering an investment, and
works with portfolio company senior management to help investee businesses
become more productive, competitive and efficient
 In the process, we strive to build stronger enterprises, preserve and create
jobs, and enable our portfolio companies to achieve lasting value for both our
fund investors and successor owners
Blackstone 1
Representative companies of Blackstone’s Private Equity

portfolio
Our 75 portfolio companies extend across a broad range of geographies and industries, and
collectively represent $109 billion in sales and 734,000 employees
________________________________________________
Note: The examples shown may not be representative of all private equity investments made by Blackstone. With respect to both performance and operating metrics, it should not be assumed that
Blackstone will make equally successful or comparable investments in the future.
Blackstone 2
The way Private Equity creates value has shifted
Leverage
32% 25%
51% Multiple Arbitrage
Source of Value
39%
46%
Operational
31% Improvement
36%
18% 22%
Leverage Era Multiple Earnings Operational

(1980s) Expansion Era Growth Era Improvement Era
(1990s) (2000s) (2008 and beyond)
________________________________________________
Sources: Goldman Sachs; BCG-IESE estimate.
Blackstone 3
Portfolio Operations Group balances productivity and growth

initiatives in concert with management and deal teams
Gross Incremental 2012 Run-rate EBITDA Impact of

Initiatives Supported by BCP Portfolio Operations Group(1)
Growth Initiatives
(Portfolio Company Initiatives)
$187mm Portfolio
Company
Initiatives:
Operations Productivity
(Portfolio Company Initiatives)
$255mm $442 million
Platform Initiatives
(Group Procurement, Equity Healthcare, Sustainability)(2)
$165mm
$607mm
________________________________________________
(1) Impact of Portfolio Company and Platform initiatives directly supported or led by Operations Group.
(2) Working capital reductions not included in EBITDA figure.
Blackstone 4
Support model integrates sector focus with functional expertise

Deal Partners 17 Sector-
Focused on Focused 23 Generalist and Functionally
Industry Sectors ex-CEOs Specialized Executives(1) 29 Full-time Equivalents
Sector Senior
Blackstone Portfolio Global Portfolio Portfolio Strategic
Leadership Executive
Companies Operations Group Support Groups
Teams Advisors
Strategy & Performance

Business Services
Enhancement CoreTrust Purchasing Group™
Governance
Consumer / Retail
Leadership / Management Equity Healthcare Group
Assessment
Financial Institutions
Transformational Change
ICF – Sustainability Initiative
Hospitality / Leisure Growth Acceleration
Pricing / Sales Force
Healthcare Lean Process Redesign BX Cross-Selling Platform
Supply Chain / Procurement

India Healthcare Benefits TBM Consulting
Industrial / IT / Operations
Chemical / Energy Business Systems / E&Y Working Capital
Financial Controls Optimization
Tech, Media, Telecom
Sustainability
Portfolio Operations Group has grown to 69 FTEs over the past seven years
________________________________________________
(1) North America, Europe, Asia. Includes 2 independent full-time operating advisors.
Blackstone 5
Representative sample of our operations professionals: team

averages 20+ years of operating and consulting experience
Sandy Ogg Don Anderson

Human Resources / Sustainability
Executive Talent ICF
Unilever, Motorola
Jeff Overly Robert Galvin

Supply Chain / Healthcare Benefits,
Lean Process Improvement CEO Equity Healthcare
Kohler, Delphi, GM GE, The Leapfrog Group (founder)
Greg Beutler Alan Roux

Supply Chain / Procurement Global Governance and
GE, Webvan Carbon Reduction
Tesco, BCG, P&G
Blake Vogt Gerry Murphy

E-Sourcing Strategy & Integrated
Emerson Performance Enhancement
Former CEO Kingfisher
Blackstone 6
Example: health costs continue to be “the problem that won’t

go away”
Premiums Are Outpacing Wages(1)  Federal budget issues – with the 2010
200% 180% Health Reform Act – will increase costs to
150% 113% 172% employers
100% 38%
109% 47%
38%
50%
11%
29%
 Companies that make healthcare costs
0% 8% 24% 38%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 a business strategy outperform their
Health Insurance Premiums Workers’ Contribution to Premiums
Workers’ Earnings Overall Inflation
competitors
Health Care Spending as %GDP(2)(3)  Private sector-led innovation is the best

(%)
way to improve health and quality while
controlling costs
________________________________________________
(1) Source: 2012 Kaiser Family Foundation and HRET Employer Health Benefits Survey.
(2) Source: Congressional Budget Office.
(3) Note: Amounts for Medicare are net of beneficiaries’ premiums. Amounts for Medicaid are federal spending only.
Blackstone 7
Equity Healthcare uses volume leverage to manage healthcare

differently
 A Blackstone-owned LLC Private Equity (PE) initiative partnering with other leading
PE Firms to help portfolio companies manage healthcare costs
• Launched in January 2009
• 7 PE Firms, 39 portfolio companies, ~320,000 members, $1.5 billion in spend
 Plug-and-play
• Portfolio company designs their own benefit plans
• Continues to use brokers and consultants of their choice
• Can stay in EH after divestiture
– ‘Not-for-profit’ pricing model
– 3%–8% decrease in cost trend goal…depends on company focus
– Delivering 13:1 return on investment
• We believe every dollar of health savings has a big dollar impact to portfolio and
PE exit multiple
Blackstone 8
Since launching we have delivered value
2009–2012 Trend Results (Plan Year)

Cumulative
Savings Since
Inception:
10.5% $229mm
9.6%
$41mm
$54mm 8.7%
6.8%
6.0%
$87mm $47mm
4.2%
3.0%
0.5%
2009 2010 2011 2012

National Benchmark EH
43% of Companies Achieved Cost Savings in 2011
Blackstone 9
Over 200 touch points across the portfolio companies

Integrated
Group Equity Performance & Lean / IT & Sales & Working Capital +
Number of Touches Purchasing Healthcare Sustainability BOD Operations Outsourcing Marketing Tax Europe India China
60 27 9 24 10 15 8 12 23 15 2
Select Portfolio Cos.
Allcargo Global Logistics t
Alliant Holdings t t
AlliedBarton t t t
Apria Healthcare Group t t t t t t
Biomet t t t t t t
BlueStar t t t
Catalent Pharmaceuticals t t t t t t t
Center Parcs t t t
DJO t t t t t t t
Freescale Semiconductor t t t t t t
Gokaldas Exports t t t t
Hilton Hotels t t t t
Michaels Stores t t t t t t t t
Nielsen t t t t t t
Vanguard t t t t t
Weather Channel t t
Transformative Initiatives t Broad-based Cost Savings Solutions t Customized Process Improvements
Blackstone 10
Case Study: Catalent
Transforming from a contract

manufacturing outsourcer to a value-
added pharma solutions provider
Blackstone 11
Catalent’s evolving focus
2013+
Growing
2009–2012
 Clear 5-year plan for growth established
Transforming the Core
 Acceleration of innovation investments
 Hiring of new CEO John Chiminski
(March 2009)  Renewed focus on strategic acquisitions
2007–2009  Commitment to Operational Excellence • Aptuit
Building the Foundation
 Indirect bullet train launched
 Acquisition (April 2007)
 Commitment to Commercial Excellence
 Creation of Product Venture Group
 Sale of Printed Components
 Member of Core Trust & Equity
 Re-composition of board; strategic
Healthcare
planning process completed
 Value pricing initiative launched
 Reorganization to create Medication
 Site sales of Albuquerque, Osny Delivery Solutions
(France) & North Raleigh
 Creation of Development & Clinical
 Decline in Packaging due to Printed Segment
Components business and
 Creation of two businesses from
underperformance in
Oral Technologies: Softgel and
Sterile
Modified Release
Blackstone 12
The Catalent transformation process
Leadership
Upgrades
Operational
Innovation
Excellence
Insert Text
Pharma
Solutions Provider
Transformation
Commercial Insert Text Insert Text Strategic
Excellence Direction
Portfolio Organizational
Management Alignment
Blackstone 13
Creating substantial value by driving excellence across

operations and quality
 Realigned functions to enable rapid Operational Productivity
(% change)
impact 30%
20%
 The Results: 10%

0%
FY09 FY10 FY11
• Nearly one-third reduction in reported Raw Materials Indirects Labor Quality
injuries On Time Delivery

• Improved on-time delivery and
93% 98%
reduced re-work 83% 88%
• 30% reduction in inventory days FY08 FY09 FY10 FY11
• Productivity up, direct and indirect Inventory Days

70
costs down 55
40
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Blackstone Operations supported run-rate EBITDA in 2010:

Procurement: $28 million; Lean: $10 million; CapEx Reduction: $32 million
Blackstone 14
Driving commercial excellence to accelerate growth
Value Pricing Revenue Impact
 Applying value pricing principles 0.3% 1.9% 2.2%
and practices
FY09 FY10 FY11
 Developing a strategic Blackstone Operations Supported
Run-rate EBITDA from Value Pricing:
marketing competency $31 million in 2010
 Expanding sales presence and Pipeline Discipline

coverage
Above: 10%
In – Defined: 25%
In – Proven: 50%
Best Few:
90%
Goal: 5%–10% Top Line Benefits
Blackstone 15
Accelerating innovation
 Strong legacy of innovation – 1,300 patents New R&D Imperatives

and applications
 Understand unmet medical needs
 IP sustains long-term value
 Drive product differentiation using our IP
 300 people – deep expertise
 Enable customer solutions
 Strong central leadership team
 Improve speed to market
 Re-alignment into global team
 New portfolio management approach

to maximize value
 Dramatic increase in innovation investment –

both organic and inorganic
500+ projects in pipeline for future launch

Blackstone 16
Performance, Projections, and Prospects: EBITDA has grown at

12.5% CAGR from 2009–2012
EBITDA Growth Accelerators
($ in millions, FYE June 30)
 Increase Pipeline launches
 Extend differentiated offerings
$389  Increase cross-sell

$352  Develop value-added products proactively
$317
$273  Expand emerging market participation
 Increase profitability through functional
excellence
 Pursue strategic acquisitions
• Aptuit recently completed
• Redwood Biosciences, oncology
FY09 FY10 FY11 FY12 technology investment
• China JV with ShangPharma &
Strong financial performance Jiangyuantang
Blackstone 17
VII. Advisory & Restructuring
Introduction to Blackstone Advisory and Restructuring
 Clients increasingly need creative and complex solutions to their issues

 The days of simple M&A transactions or uncomplicated restructurings are over
 Brave advice based on creative, unique thinking is what is required
 Very few investment banks have maintained true advice as a core strength
 Blackstone Advisory and Restructuring have:
• Senior Managing Directors with more than 20 years of industry experience, on average
– Deep, talented bench
• Considerable industry expertise
• Dedicated, senior driven relationships
• Investor mentality
• Independent / conflict-free advice
• Global network
• Ability to bring all of Blackstone to each assignment
Blackstone 1
Introduction to Blackstone Advisory and Restructuring (cont’d)
 Blackstone Advisory and Restructuring practices complement each other

• Advisory benefits from a strong macro-economic environment whereas Restructuring
is counter-cyclical
• Collaboration and exchange of expertise between groups allow firm to better serve
clients’ needs
• In 2012, the two groups worked on 19 significant deals together
 Despite complex economic headwinds and volatile markets, we continue to achieve

success in both businesses
• 2012 was Restructuring’s 4th best revenue year in history
– Best year ever outside of recent credit crisis years
• 4Q 2012 was Blackstone Advisory’s best revenue quarter ever
• Both groups have strong 2013 pipelines across most industries
Blackstone 2
Blackstone’s fully integrated advisory platform offers

comprehensive, independent and conflict-free advice to clients
Restructuring Advisory M&A / Corporate Finance Advisory
 Wide range of advisory services:  General advice related to mergers, acquisitions and
• Exchange offers portfolio rationalizations and divestitures
• Debt repurchases  Objective advice with respect to capital structure
• Debt and equity capital raises and financing alternatives
• Sponsor representations • Acquisitions • Equity advisory
• Distressed M&A • Third-party sales • Leveraged buyouts
• Out-of-court recapitalizations • Divestitures • Recapitalizations
• In-court reorganizations • Special Committee • Minority investments
• Cross-border reorganizations representation • Takeover defense
• Valuation and expert witness testimony • Initial public offerings • Joint ventures
• Pension and retiree health care solutions • Private placements • Structured products
Blackstone 3
What we’re seeing in the advisory market
 U.S. M&A volume down 14% since 2011; however, activity increased in 4Q 2012 and 1Q 2013, with 4Q generating the largest volume
since 2Q 2008
• A macroeconomic backdrop consisting of robust equity markets and low interest rates as well as strong corporate balance sheets
and limited organic growth opportunities suggests that 2013 should generate significant U.S. activity
 European M&A activity continues to be depressed with 2012 volume at the lowest level since 2009, leading to increased restructuring
opportunities in the financial sector and weaker economies
 Asia-Pacific M&A volume also remained below 2009 levels
• However, Chinese, Korean and Japanese corporates and Sovereigns generally are cash rich and will continue to put capital
to work
Global Announced Transactions
$1,500 15,000
Volume of Transactions ($ in billions)
$1,200 12,000
$900 9,000
# Deals
$600 6,000
$300 3,000
$0 0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
Annual 2006 2007 2008 2009 2010 2011 2012 Q1 '13
Global $3,546bn $4,231bn $2,717bn $1,970bn $2,482bn $2,529bn $2,321bn $527mm
U.S. ($ Vol) Non-U.S. ($ Vol) # Deals (Globally)
________________________________________________
Source: Thomson SDC, Mergermarket as of 3/31/13.
Blackstone 4
Blackstone Advisory: 2012 Revenue Breakdown

Revenue by Industry Revenue by Geography
Telecom Consumer FIG Asia

Industrials 5% 3% 11%
6% 19%
Healthcare
9%
Europe
Tech 28%
Real Estate
17%
9%
Americas
Energy 61%
10%
Metals & Media
Mining 11%
11%
Revenue by Product Revenue by Size
Financing /
Structured Restructuring
Restructu- Small Cap
10%
24% ring 28%
24%
Large Cap
M&A 72%
66%
Blackstone 5
Blackstone Advisory Partners has advised on numerous

high-profile transactions globally(1)
$10.2 Billion $13.0 Billion $1.0 Billion $846 Million $6.0 Billion N/A
Advisor to Advisor to Exclusive financial Advisor to Advisor to Advisor to

advisor to
on the proposed merger

on its sale to on its proposed on its acquisition of of
acquisition of certain assets of the on its sale to on its sale to
consumer credit
services subsidiary of
and
Pending Terminated 2012 2012 2012 2012
$1.2 Billion and

$1.1 Billion $2.2 Billion $38.5 Million $4.3 Billion $30.3 Billion
€650 Million
Advisor to Exclusive financial Advisor to the Board of Advisor to Advisor to Advisor to
advisor to the Directors of
on the combination of its
on its 50/50 auto JV global power business with
on the sale of its with
interests in on its acquisition of
on the sale of the Team, CHINA CHANGAN AUTOMOBILE GROUP and in its partnership with
SEMCO Holding Stadium, Media Rights and on its sale of a 16.6% equity and its entry in the
Corporation a 50% stake in the stake to and execution of a
Indian market including the sale of a 30%
surrounding land to commercial agreement with
to stake in its Exploration &
Guggenheim Baseball
Management LLC Production division
2012
2012 2012 2011 2011 2011 2011
________________________________________________
(1) Dates refer to transactions’ closing dates.
Blackstone 6
Outlook for Advisory Market
 Given the strength of the capital markets and improved economic environment, M&A
activity should be meaningful in 2013
• Natural resources, FIG, Technology, Consumer and Industrials should be the most
active sectors
• Despite a slow start to 2013, international and cross-border activity is expected to
increase in 2013–2014
• Private equity firms should create more activity
 BAP continues to build out its global presence across geographies and industries
• Recently added key members to the Industrials, FIG and Healthcare teams
• Growing business in Germany and China
• Strong collaboration with Pátria in Brazil
• Selectively advising activist hedge funds on M&A opportunities
Blackstone 7
What we’re seeing in the restructuring market
 The restructuring business is typically highly  Credit terms loosened to pre-2007 levels
correlated to the high-yield market and • Dividend recaps
default rate • PIK toggle
 2012 was a contradictory year in the markets • Covenant-lite
• Economic: • Overall leverage
– Euro debt crisis
 Many speculative grade issuers took advantage:
– U.S. “Fiscal Cliff”
• Refinanced maturities
– Slower China growth
• Issued new, cheap paper
– Unemployment rate grudging reduction
• Debt markets:
– Investors chased yield
– Record high-yield new issue volume
– Record combined high-yield and
leveraged loan issuances
Blackstone 8
Blackstone Restructuring: 2012 Revenue Breakdown
 Large out-of-court market share

 Diverse client base – large and middle market companies, financial sponsors, various creditor groups
 Leadership in key industries
2012 Revenue by
Transaction Type 2012 Revenue by Client 2012 Revenue by Industry
Other
Energy
1%
11%
Other
31% Financial
Services
Out-of-
16%
Court
Creditor Manufacturing
43% In-Court 40%
57% Company 2%
59% Technology /
Telecom
7%
Media
Gaming 22%
11%
Blackstone 9
Blackstone Restructuring advised on many of the largest restructurings

completed in 2012 and ranked #1 in the U.S. for completed restructurings,
representing $43 billion of liabilities(1)
$270.0 Billion $8.6 Billion $7.6 Billion $4.1 Billion $4.1 Billion $3.1 Billion
Advisor to Advisor to Advisor to Advisor to Advisor to Advisor to
Private Creditor- Senior Lenders of Washington Unsecured Creditor
Investor Committee Committee of
for Greece (PCIC)
Mutual
Regarding valuation of a Regarding its out-of-
mortgage reinsurance court restructuring of Regarding its
In all aspects related asset and potential debt obligations in the prepackaged Chapter 11
During its participation to the Company’s rights offering to U.S., UAE and Mexico restructuring
reorganize the business In all aspects related
in the largest sovereign Chapter 11 restructuring
to the Company’s
debt exchange in history Chapter 11 restructuring
Ongoing $1.8 Billion $1.6 Billion $1.1 Billion Ongoing $625 Million
Advisor to Advisor to Advisor to Advisor to Advisor to Advisor to
First Lien Noteholders Ad Hoc Group of

Patriot of Second Lien
Noteholders of
Coal
In all aspects of its out- Regarding its
In all aspects relating
of-court simultaneous prepackaged Chapter 11
Kodak
to the Company’s In its Chapter 11
debt amendment and restructuring
Chapter 11 restructuring In all aspects related In all aspects relating restructuring and sale
extension and exchange
to the Company’s to the Company’s of assets
offer
Chapter 11 restructuring Chapter 11 restructuring
________________________________________________
Note: For creditor assignments, liabilities include only the liabilities of constituent creditors. All transactions completed in 2012 unless otherwise noted.
(1) Source: Thomson Reuters Distressed Debt and Bankruptcy Review, Restructuring Advisors Full Year 2012 and Blackstone estimates.
Blackstone 10
Blackstone’s restructuring practice has earned substantial praise and

recognition, including recently as the IFR 2012 Restructuring Adviser of the
Year, both globally and in the U.S.
2012 #1 in U.S. Completed Restructurings(1)
(2)
(3)
Restructuring Adviser U.S. Restructuring

2012 2012 2011 2011
of the Year (Global) Adviser of the Year
Restructuring
2011 2009 2011 2011
Banker of the Year
Americas Restructuring
2008 2005 2010 2010
House of the Year
North American
2004 2010 2010
Restructuring House
________________________________________________
(1) Published in the Thomson Reuters Distressed Debt and Bankruptcy Review, Restructuring Advisors Full Year 2012. Ranking based upon market share of U.S. Completed Restructurings.
(2) Award winners selected by the IFR editorial team from a limited universe of participants based on subjective criteria.
(3) Over the last five years, winners are selected based on the deal / assignment performance criteria / index, by an independent advisory group.
Blackstone 11
Outlook for Restructuring Market
 The current consensus outlook for corporate credits in 2013 is largely

unchanged from 2012
• 1Q broke all records with $119 billion of high-yield issuances and
$203 billion of leveraged loan issuances(1)
• Inflows of new funds will rise and fall, but are expected to be robust
• Most market pundits expect strong demand for high-yield bonds and
leveraged loans to continue throughout 2013
 High-yield default rates are predicted to remain low
– 1.5% to 3.7% range(2)
________________________________________________
(1) Source: J.P. Morgan Credit Strategy Weekly Update (3/28/13).
(2) Sources: J.P. Morgan (3/28/13), Moody’s Investors Service (12/19/12), Standard & Poor’s (12/20/12).
Blackstone 12
Is aggressive 2012 issuance sowing the seeds for the next

period of peak defaults?
Lower Rated New Issue Volume vs. Defaulted Debt(1)
($ in billions)
$100 Leads to increased 94.6 Will increased lower

defaults rated issuances again
$90 Leads to increased
lead to defaults?
defaults
$80 Increased lower
rated new
$70 issuance 63.7
Increased lower
$60 rated new 56.0 55.6 53.6 54.4
issuance
$50 43.2
$40 32.6 31.1

31.0
28.3
$30 22.0
24.9 22.9
17.7 18.5 19.4 19.4 18.5 19.1
$20 15.3 13.7 14.1
8.0 7.6 8.6
$10 5.9 7.2 7.9 4.8 5.2
7.6 7.3 7.9
3.4 2.3 3.2 2.3
$0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 YTD
2013
Lower Rated New Issuance Defaulted Debt
________________________________________________
Source: J.P. Morgan Default Monitor (4/1/13).
(1) Lower rated issuances includes bonds rated Split B or lower.
Blackstone 13
Lower rated credits have a significant and predictable

default cycle
Global Corporate Average Cumulative Default  Increased default rates typically follow
Rates (1981–2012) (%)
peaks in high-yield debt issuance by
60% approximately three to five years
50% CCC and Worse
 Historically, 47% of CCC / C rated debt
% Defaulted (Dollar Weighted)
40% defaults within five years of issuance

30% B
20%
BB
10%
0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Years Since Issuance
BB B CCC / C
•
________________________________________________
Source: S&P Default, Transition, and Recovery: 2012 Annual Global Corporate Default Study and Rating Transitions (3/18/13). Percent of issues that subsequently
defaulted in the stated year following issuance.
Blackstone 14
What does this mean for Blackstone Advisory and

Restructuring?
 The contradictory market conditions could lead to a few possible scenarios:
• Status quo – global economic uncertainty, volatile equity markets, strong credit markets
– Windows for financings (debt and equity) will continue to become available and
provide opportunities for M&A and restructuring deals to get done
• The economy stabilizes and equity markets remain strong
– Should lead to increased M&A activity
• The economy deteriorates and drags equity and credit markets down
– Could lead to increased restructuring activity
 Regardless, we are well positioned to enjoy strong deal flow in both strong and weak
economic environments
• Strong pipelines across most industries
• Continued collaboration between groups
– Currently working on 12 deals together
• Ability to find creative, unique solutions to complicated problems
Blackstone 15
VIII. BAAM
BAAM has established its clear position as an industry leader
 Largest discretionary allocator to hedge funds in the world(1)

• $48 billion in AUM(2) (nearly $20 billion larger than the next largest fund of hedge funds competitor (1))
 Separated from traditional competitors
• 31% AUM CAGR since 2001, compared to 14% for other fund of funds over $1 billion(1)
• 20% AUM CAGR since 2007, compared to (-5%) for other fund of funds over $1 billion(1)
 Meaningful business diversification and product innovation
• Largest hedge fund seeder in the world
• Over $5 billion in special situations and long-biased opportunities
 Attractive long-term risk-adjusted returns
• 8% annualized return with 1.2 Sharpe since 1996 in the flagship fund, compared to 4.8% annualized return with
0.48 Sharpe for the HFRI FoF Conservative Index(3)
 Attractive economics
• 18% 5-year revenue CAGR (2008–2012)
________________________________________________
Note: See “Important Disclosures” section at the front of the presentation book for more information.
(1) Source: InvestHedge Billion Dollar Club. Data as of December 2012.
(2) AUM data is as of 4/1/13 and is estimated and unaudited; client count is as of 3/1/13. AUM excludes unfunded commitments, which are included in total AUM for external reporting purposes.
(3) Data as of March 2013. Performance prior to 7/1/05 represents Partners NT and performance after 7/1/05 represents Partners OS. Results are net of all fees and expenses for Class F Shares, the largest share class in Partners OS.
Performance for 2012 and 2013 is estimated and unaudited. Performance information since 1/1/2004 includes an allocation of income from new issues; performance results for the Fund will vary for investors ineligible to
participate in new issue income. Past performance is not necessarily indicative of future results. There can be no assurance that the Fund will achieve its objective or avoid significant losses.
Blackstone 1
Innovation has been the key to BAAM’s growth
Historical and Projected Growth by BAAM Business Segment

($ in billions)
$70
$60
Individual Investor Solutions (e.g., RIC, Distribution Partnerships)
$50
$40 Specialized Solutions (e.g., Direct trading, Seeding, Long Only)
$30
$20 Custom Accounts (e.g., Client Funds-of-One)
$10
Traditional Commingled Products (e.g., Partners, Park)
$0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Core – Commingled Core – Custom Accounts Specialized Solutions Individual Investor Solutions
________________________________________________
Note: The projections above are for illustrative purposes only. These projections are not based on any objective data and are simply meant to illustrate BAAM’s opinions on how the diversification of its
business will continue into the future.
Blackstone 2
BAAM’s growth has outpaced the industry
Cumulative Growth in Assets for HF Industry, FoHFs >$1 billion, and BAAM(1)
(US$ in billions)
Cumulative Growth
Since 2001 HF Industry AUM
2001–2012 CAGR 2007–2012 CAGR
2,000%
2,000% $2,500
$2,500
BAAM: 31% BAAM: 20%
1,800%
1,800% >$1bn FoHFs: 14% >$1bn FoHFs: -5%
HF Industry: 14% HF Industry: 7%
1,600%
1,600% $2,000
$2,000
1,400%
1,400% 2001–2006 CAGR
1,200% BAAM: 46% $1,500
1,200% >$1bn FoHFs: 41% $1,500
1,000%
1,000% HF Industry: 22%
800%
800% $1,000
$1,000
600%
600%
400%
400% $500
$500
200%
200%
0%
0% $0
$0
2001 2002
2001 2002 2003
2003 2004 2004 2005
2005 2006
2006 2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012
HFHF
Industry ($)($)
Industry BAAM
BAAM FOF
FOF >$1B
>$1B ex
ex BAAM
BAAM HFIndustry
HF Industry(%)
(%)
________________________________________________
Blackstone 3
BAAM has had positive net inflows every year since 2000
Top 10 Fund-of-Funds as of 12/31/2012(1)

(US$ in billions)
6/30/2008 12/31/2012 % Change Since 2012 AUM

Manager AUM AUM June 2008 Growth
BAAM $31.7 $44.8 41.4% $5.52
Competitor 1 56.8 25.5 (55.2%) ($1.53)
Competitor 2 46.6 25.1 (46.1%) ($3.42)
Competitor 3 25.4 22.9 (9.8%) $0.09
Competitor 4 27.4 22.3 (18.6%) ($0.50)
Competitor 5 21.9 20.3 (7.1%) $1.07
Competitor 6 39.3 18.3 (53.4%) ($1.69)
Competitor 7 24.5 18.1 (26.2%) $0.28

(2)
Competitor 8 15.6 16.5 6.0% $3.60
Competitor 9 18.9 15.2 (19.7%) $0.12
________________________________________________
(2) Competitor 8’s AUM includes $8 billion that was acquired when the firm merged with another asset manager in 2012. Excluding this $8 billion, Competitor 8’s 12/31/12 AUM is $8.5 billion, which results in net outflows of $4.4
billion in 2012, and a decrease in AUM of 45% since 6/30/08. BAAM AUM excludes unfunded commitments, which are included in total AUM for external reporting purposes.
Blackstone 4
Institutional composition of client base provides stability
 BAAM’s clients have supported our growth and the diversification of our business
BAAM Client Breakdown(1) Net BAAM Inflows

(by investor type) (by investor status)
Blackstone
Corporations and Capital and
Partnerships Employees
4.3% 2.9%
Endowments and
Foundations 38% 36% 36%
5.0% 52%
Government
Institutions
21.5%
Pension Funds
48.9% 62% 64% 64%
48%
Healthcare
5.2% 2009 2010 2011 2012
High Net Worth
and Trusts
2.6%
Existing Clients New Clients
Insurance Distribution
6.8% 2.9%
________________________________________________
(1) Based on AUM as of 4/1/13.
Blackstone 5
BAAM is a high-growth business
 BAAM has maintained strong financial performance across major metrics…
Hedge Fund Solutions (“HFS”) Summary Financials

($ in millions)
2009 1Q’13 LTM CAGR

AUM $28,799 $48,187 17%
Revenue 313 509 16%
Economic Income 170 284 17%
 …while making a significant contribution to Blackstone

Pre-Tax Distributable Earnings(1)
($ in millions)
HFS BX HFS%
2009 $118.6 $527.8 22.5%
2010 177.1 743.2 23.8%
2011 159.3 772.9 20.6%
2012 241.0 1,162.4 20.7%
________________________________________________
(1) Pre-tax DE excludes taxes, TRA and treasury cash management adjustment for both HFS and BX.
Blackstone 6
BAAM has diversified its business across multiple initiatives
BAAM
Hedge Fund Solutions: $48bn
Individual
Commingled & Customized Specialized Solutions Investor
Solutions
Regulated &
Customized
Commingled Long Only / Special Individual-
Investment Ventures(1)
Products Long Biased Situations(2) Focused
Solutions
Products
$1.7bn Invested
$17.8bn $23.5bn $1.3bn $3.6bn $1.4bn $0.2bn
Committed
________________________________________________
Note: AUM data is as of 4/1/13 and is estimated and unaudited for 2012 and 2013. AUM excludes unfunded commitments, which are included in total AUM for external reporting purposes.
(1) Representative of BAAM’s manager seeding platform.
(2) Special Situations AUM as of 1/1/13; includes investments from BAAM Commingled and Customized products.
Blackstone 7
A. Industry Dynamics Have Supported BAAM’s Rapid Growth
Hedge fund industry growth continues after financial crisis

AUM Growth (Hedge Fund Industry)(1)
($ in billions)
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E
Projections(3)
 Net inflows of $34 billion in 2012 were lower than expected(1)
 Expected HF net inflows of $123 billion in 2013(2)
________________________________________________
(1) HFR Global Hedge Fund Industry Report, 12/31/12.
(2) Deutsche Bank Eleventh Annual Alternative Investor Survey, February 2013.
(3) Credit Suisse 2013 Global Survey of Hedge Fund Investor Appetite and Activity. 2013 low case and base case hedge fund industry AUM growth forecasted to be 4.55% and 10%, respectively.
Blackstone 9
Institutions driving recent growth in hedge fund industry AUM

 Hedge Fund investor base is now predominantly institutional(1)
Hedge Fund Industry AUM by Investor Type(1)
52% 56% 56%

69% 74% 77%
Institutional
Individuals
48% 44% 44%

31% 26% 23%
2001 2003 2005 2007 2009 2011
BAAM expects individuals to return, albeit a different market segment (retail) requiring more
liquid, regulated investment vehicles
________________________________________________
(1) Source: Hennessee Group LLC; FSA; TheCityUK estimates, April 2012.
Blackstone 10
Hedge funds becoming a larger part of institutional portfolios

 Pension Funds are increasing allocations to hedge funds
Average Pension Fund Allocation to Hedge Funds(1)
6.8%  A majority of institutions, including pension

6.4%
plans, endowments, foundations and insurers,
reported increased hedge fund holdings last
year(2)
4.2%
 Pension funds, in particular, are increasing their
hedge fund investments, with over 60% of
them having increased such holdings in 2012(2)
 65% of investors, including 79% of institutions,

target returns between 5% and 10% for their
hedge fund investments in 2013(2)
2009 2010 2011
________________________________________________
(1) McKinsey / Institutional Investor Global Survey on Institutional Investing, 2011. Represents pension funds in the U.S., Canada, Australia, Japan, Netherlands, Switzerland and U.K.
(2) Source: Deutsche Bank’s Annual Alternative Investment Survey, 2013.
Blackstone 11
Hedge funds continue to attract talent given their flexibility
 Dodd-Frank, Basel III, and other global Capital Leverage Employed by Hedge Funds and
regulatory changes are reducing the ability of Bank Proprietary Trading Desks(1)
($ in billions, 2008–2010)
investment banks, commercial banks, and
insurance companies to compete with hedge
funds
 Human capital is leaving the sell side as it is

forced to reduce capital allocation to
opportunistic and quantitative trading
strategies, thus increasing the flow of top
talent to hedge funds
 The market recovery has heightened

entrepreneurial ambitions for talented asset Hedge Bank “Prop” Hedge Bank “Prop” Hedge Bank “Prop”
Funds Desks Funds Desks Funds Desks
managers seeking the most favorable 2008 2009 2010
compensation structures Hedge Fund Capital Hedge Fund Leverage
Bank “Prop” Desk Capital Bank “Prop” Desk Leverage
________________________________________________
(1) Source: Cambridge Associates, 2011.
Blackstone 12
Hedge funds currently represent only a fraction of global assets
Comparison of Global Financial Assets(1)(2)(4)

($ in trillions)  Total capital invested in hedge funds
exceeded $2 trillion for the first time
$215 in 2012(1)
 Hedge funds represent less than 2.0% of

global financial assets(2)
$16
$2
 Average 10-year rolling Sharpe ratio of 1.7 for
Global Financial Top 10 Asset Hedge Fund the HFRI Composite(3)
Assets Managers Industry
________________________________________________
(1) HFR Global Hedge Fund Industry Report, 4Q 2012.
(2) Global financial assets include equity market capitalization and outstanding bonds and loans; McKinsey Global Institute Financial Stock Database. Assets are as of 12/31/11.
(3) Refers to the HFRI Composite. Past performance is not indicative of future results.
(4) Top 10 firms include BlackRock, State Street, Vanguard, Fidelity, PIMCO, JP Morgan, BNY Mellon, Capital Research, Prudential, and Amundi. Assets are as of 12/31/11.
Blackstone 13
B. BAAM’s Strategy and Positioning
BAAM has produced attractive risk-adjusted performance

Partners OS Beta to Indices: July 1996–March 2013(1)
HFRI FOF Cnsv MSCI World TR S&P 500 TR FTSE 100 Barclays Agg CSFB HY GSCI
Beta to Partners OS 0.93 0.17 0.15 0.17 -0.02 0.29 0.07
Risk Return: July 1996–March 2013(1)
10%
Partners OS
Annualized Return
8% CSFB HY
FTSE 100 S&P 500 TR
6% Barclays Agg Bond
MSCI World
HFRI FOF Cnsv
4%
GSCI TR
2%
0%
0% 4% 8% 12% 16% 20% 24%
Annualized Standard Deviation
________________________________________________
(1) Reflects the net returns for Partners NT from its inception 7/1/96 through 6/30/05 and for Partners OS from its inception 7/1/05 to 3/31/13. Partners NT is the predecessor Fund to Partners OS. Results are net of all fees and
expenses for Class F Shares, the largest class in Partners OS. Performance for 2012 and 2013 is estimated and unaudited. Annualized return represents the unaudited compounded annual return on investment. Performance
information since 1/1/04 includes an allocation of income from new issues; performance results for the Fund will vary for investors ineligible to participate in new issue income. Past performance is not necessarily indicative of
future results.
Blackstone 15
Tactical allocations have driven industry-leading performance
Partners OS vs. Peer Group

10.0
8.0
6.0
Return (%)
4.0
2.0
0.0
(2.0)
(4.0)
1 Year 3 Years 5 Years
1 Year 3 Years (% p.a.) 5 Years (% p.a.)

Partners OS 7.9 4.6 2.2
Upper Quartile 7.7 4.1 2.0
Median 6.7 3.7 0.5
________________________________________________
(1) Net returns over for each time period ending December 2012. Comparison with Mercer’s custom universe “Partners Competitors“, universe comprises 14 funds. Number in brackets refer to actual ranking.
(2) The report included above was created for BAAM by Mercer. Blackstone Partners Offshore Fund Ltd. (“Partners OS”) was compared to a peer group of comparable products selected by Blackstone. The selected competitors are:
Corbin Capital – Pinehurst Partners, Entrust Capital Diversified Fund Ltd. – Class C, Fauchier Partners – Jubilee Absolute Return Fund, GAM – Diversity USD Open Class, Lighthouse (Florida) – Lighthouse Diversified Fund, Mariner
Investment Group – Mariner Select, Permal Investment Holdings N.V., Pine Grove – Offshore Fund Ltd., Prisma – Low Volatility, BlackRock, PAAMCO, Grosvenor and Mesirow. Returns included for Partners OS are net of all fees
and expenses. The time periods shown were selected by Blackstone. Past performance is not necessarily indicative of future results. Utilizing a different peer group or different time period will produce different results.
(3) The universe calculations in the graphic are based on a customized universe selected by BAAM and is not an official Mercer universe. This output should be read in conjunction with, and is subject to MercerInsight MPA: Important
notices and third-party data attributions. See www.mercerinsight.com/importantnotices for details. Copyright: © 2011 Mercer LLC. All rights reserved. This graphic was created by Mercer on 2/4/13 at 6:58pm.
Blackstone 16
Complex business has entered its third growth phase

AUM 2012/2013
($ in millions)  Direct investment capability (BSOF)
 Individual Investor Solutions
 Minority stakes
2005/2006  Increased globalization
 Expansion of investment team skill set to
AUM, Revenues & Headcount
underwrite one-off risks (e.g., sub-prime)

 Creation of specialty products (e.g., SAF
44,812
and Resources Select)
 Open Hong Kong office
2001/2002
 First customized solution
 Investment in human capital 27,095
 Open London office
14,997
1,572 6,299
2000 2003 2006 2009 2012

Commingled Customized Ventures Long Only/Long Biased Special Situations Indiv. Investor Solution
Clients in 2000: 98 Clients in 2006: 243 Clients in 2012: 589

Investor Base
0.2% Asia ex-Japan

ME 0.1% 1% Australia Asia ex-Japan Australia
N. America Europe Japan 5%6%
10%
100% 7%
N. America
UK 25% ME 12% 49%
63% 7%
N. America Europe
15%
UK
Data is estimated and unaudited for 2012 and 2013. BAAM AUM excludes unfunded commitments, which are included in total AUM for external reporting purposes. Blackstone 17
Individual investor solutions relatively untapped by BAAM
$19.5 Trillion U.S. Retirement Assets U.S. Defined Contribution Market Inflows
(4Q 2012) ($ in billions)
$108 $103
DC Plans IRAs $97
26% $94
28%
$65
$46
Private Annuities
DB 9%
13%
2007 2008 2009 2010 2011 2012
Gov’t DB
25%
________________________________________________
Sources: Investment Company Institute, Federal Reserve Board, National Association of Government Defined Contribution Administrators, American Council of Life Insurers, and Internal Revenue Service Statistics of Income Division.
Blackstone 18
Adapting hedge funds for a ’40 Act mutual fund
Target Launch: June 1, 2013

Hedge Funds(1) Liquid Solution
Quarterly,
Quarterly,Semi-Annually, Annually
Semi-Annually, Annually
Liquidity (subject
(subjecttoto locks andgates)
locks and gates)
Daily
Daily
Valuation Monthly
Monthly Daily
Daily
Performance Fees 15% – 30%

15%–30% None
None
Income Character No Restrictions Subchapter M Restrictions
Leverage No
Norestrictions
Restrictions Max
Max 250% – 300%Gross
250%–300% gross exposure
Exposure
Concentration Norestrictions
No Restrictions SubchapterM
Subchapter M Restrictions
restrictions
Transparency Limited
Limited EnhancedLevel
Enhanced level transparency
Transparency
Capacity Constraints Highly Variable Typically Limited

(1) Represents typical features of hedge funds in general. Blackstone 19
Strong returns across a broad range of direct investing activity

Asset Class Allocation(1)(2) Performance Summary(3)
Opportunisitic HFR Fund

Commodities 1.5% Other BSOF S&P 500 TR Wtd Cmps
5.7% 0.9%
Hard Asset Credit – Net Ann. Return Since Inception(4) 12.38% 12.60% 2.18%
4.0% Corporate
Equity – Private 30.4%
2.6%
Std. Deviation 3.13% 15.19% 6.31%
Beta to Index – 0.13 0.33
Sharpe Ratio 3.94 0.83 0.34

Credit –
Sovereign
Equity – Public 3.3%
30.7%
Credit –
Structured
Credit – Whole 10.7%
Loans
10.2%
________________________________________________
(1) Investments shown include investments approved by BAS Investment Committee but not yet funded as well as investments already exited. There is no assurance that funding will occur. The AUM of BSOF was $1,725 million as of
3/31/13.
(2) Asset Class Allocation includes realized deals.
(3) Net performance is presented net of an annual management fee of 1.50% and an incentive fee of 25%, the maximum all-in fees charged to an external investor. Past performance is not necessarily indicative of future results.
Returns are estimated and unaudited for 2012 and 2013. The returns presented above are inclusive of all BSOF investments. Certain BSOF investments may be unavailable to ERISA investors and therefore returns may vary.
(4) From 8/1/11 through 3/31/13.
Blackstone 20
Leveraging seed capital into lucrative revenue shares

Assets
(bars, $ in billions)
SAF I – External Asset Growth Cumulative Revenue Share
(line, $ in millions)
$10$10 $200
$200
$9 $9 $180
$180
$8 $8 $160
$160
$7 $7 $140
$140
$6 $6 $120
$120
$5 $5 $100
$100
$4 $4 $80$80
$60
$3 $3 $60
$40
$2 $2 $40
$20
$1 $1 $20
$0
$0 $0 $0
2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012
SAF I Invested Capital SAF I Underlying Managers’ Total AUM SAF I Cumulative Revenue Share (1)
________________________________________________
Asset data represents the first of the year for the date shown (includes inflows) and revenue share data represents cumulative accrual up to and including the year shown.
(1) Cumulative revenue share is plotted to scale on a secondary axis, and is indicative of the relationship between asset growth and revenue share. A portion of the underlying managers’ assets, such as internal investments by fund
managers and employees, may not be subject to full fees. Reflects cumulative information for Blackstone Strategic Alliance Fund L.P. and Blackstone Strategic Alliance Offshore Fund Ltd. and is based on information received from
underlying managers. BAAM / BSAA may not independently verify this information on a regular basis and as such does not guarantee its accuracy.
Blackstone 21
What else is new?
 Purchasing minority GP interests in mature hedge funds

• Typical targets have $5+ billion in AUM, strong franchises and attractive growth
prospects
• Compelling cash flow and capital appreciation potential
• Expected $2 billion–$2.5 billion in capital
 Mutual fund with hedge fund exposures

• High-conviction managers in daily liquidity, daily NAV, low fee structure
• Opens multiple new channels
• Expected $1+ billion AUM in first 12 months
Blackstone 22
IX. GSO
GSO is a leading diversified credit manager with a global footprint

and 233 employees in New York, London, Dublin and Houston
Total Assets Under Management
GSO Capital Partners(1)
$59 billion
Alternative Customized
Investment Funds Credit Strategies
BDCs Closed End

Mezzanine Rescue Lending Event Driven CLOs Funds,
Funds(1) (Small Cap Hedge Funds
Funds Commingled
Direct Lending)
Funds and SMAs
$8 billion $8 billion $7 billion $4 billion $24 billion $8 billion
(1) Pro forma 3/31/2013 AUM to include commitments to our second rescue lending fund that have closed through 4/30/2013. For public reporting purposes, Blackstone 1
the AUM in BDCs is reported within Customized Credit Strategies.
GSO is a leading diversified credit manager with a global footprint

and 233 employees in New York, London, Dublin and Houston
Total Assets Under Management
GSO Capital Partners(1)
$59 billion
Alternative Customized
Investment Funds Credit Strategies
BDCs Closed End

Mezzanine Rescue Lending Event Driven CLOs Funds,
Funds(1) (Small Cap Hedge Funds
Funds Commingled
Direct Lending)
Funds and SMAs
$8 billion $8 billion $7 billion $4 billion $24 billion $8 billion
Private Debt Strategies Public Market Strategies

(1) Pro forma 3/31/2013 AUM to include commitments to our second rescue lending fund that have closed through 4/30/2013. For public reporting purposes, Blackstone 2
the AUM in BDCs is reported within Customized Credit Strategies.
GSO works to solve financial problems for companies, across

asset classes and investment vehicles
Competitive
Investment Strategy Superior Returns
Advantage
“Solve the Problem” Investment Results(1)

ITD Net Returns
Scale  Focus on good companies
with imminent capital needs GSO Benchmark
Mezzanine 19.9% 10.2%

 Activist investment style
Brand Rescue
14.9% 8.7%
 Originate our own deals Lending
Hedge Funds 8.6% 5.1%

 Invest in market leaders
Investment Small Cap
Expertise 17.2% 10.0%
 Dimension our downside Direct Lending
________________________________________________
(1) Past performance is not necessarily indicative of future results. GSO returns represent weighted average returns for the onshore and offshore vehicles (if applicable) for the respective flagship funds.
Returns calculated from fund inception through March 31, 2013 except for Small Cap Direct Lending Benchmark which is calculated through 12/31/2012, due to availability of benchmark data.
See “Important Disclosures” section at the front of the presentation book for more information on performance and benchmarks.
Blackstone 3
Preservation of Principal: The cornerstone of GSO’s

investment process
Private Market Strategies
Mezzanine Rescue Small Cap
Investing Lending Direct Lending
Inception Year 2007 2009 2009
Number of Investments 50 34 60
Capital Invested $4.6 Billion $3.9 Billion $2.9 Billion
Number of Investments with Losses 2 1 0
Total Realized Loss of Principal $35 Million $50 Million $0
Total Realized Loss of Principal: 0.9%
Blackstone 4
Driving investment performance: Keys to our success
Leverage Our Brand and Scale

 Aim to originate unique opportunities with the best risk-adjusted returns
 Partner with companies, banks and sponsors to solve problems others can’t
Capitalize on Industry Themes

 Deep experience and knowledge across the GSO and Blackstone platform
Maintain Our Investment Philosophy and Discipline

 Relentless focus on protecting downside through credit selection and
structuring
Active Involvement in Monitoring Our Portfolio
 Board participation, capital markets input, Blackstone operations team,
realizations
Blackstone 5
Brand and Scale: Partnering with companies to solve problems
“GSO was an excellent partner for Chesapeake in our “We are excited that GSO will become our largest
Utica and Cleveland Tonkawa transactions. They shareholder. GSO made a significant investment in
understood our goals and objectives, worked with us 2008 that provided Cheniere with necessary funding at
to structure a deal that worked well for both parties a time when the credit markets were challenging. They
and were true to their word throughout the process.” have given us the time and support to adjust our
Aubrey McClendon
strategy to changing global natural gas markets.”
Co-Founder, Former Chairman and CEO Charif Souki
Chesapeake Energy Corporation Chairman and CEO
Cheniere Partners
“By combining the financial power and investment “We were faced with two choices: (i) lose control of
experience of GSO with the homebuilding and Almatis to a vulture fund or (ii) partner with GSO
operating strength of Hovnanian, this partnership Capital Partners. GSO developed a very creative
creates an exciting investment opportunity for both financing solution at our moment of need that enabled
organizations.” DIC to retain its ownership in the company while also
providing important capital for the company to
Ara Hovnanian
Chairman, President and CEO prosper.” David Smoot
Hovnanian Enterprises CEO
Dubai International Capital
________________________________________________
The experience and views expressed by officers of certain portfolio companies may not be representative of all portfolio companies’ experience or the future performance of GSO. There is no guarantee that similar experiences will
be enjoyed by portfolio companies of GSO or any other funds managed by GSO in the future.
Blackstone 6
Capitalizing on industry themes: Collaboration across GSO /

Blackstone
Unique Vantage Points
 GSO Platform: Capturing Informational Synergies
 The Blackstone Global Footprint
• Industry Verticals across GSO and BCP
 Access to CEOs and Portfolio Companies
 BCP Dashboard Review and MacroView Development
 BAAM: Review of Investment Trends / Portfolio Construction
 BREP: Teaming Up in Residential Housing
 Access to Government Entities
 Idea Development from Wall Street
• Economists / Market Strategists
• Industry Bankers
• Capital Market Specialists
Blackstone 7
Capitalizing on industry themes: Collaboration across GSO /

Blackstone
($ in millions)
Year Theme Capital Gross
Developed Sector Transactions Committed MOIC IRR
2010 Shale Gas Crosstex 216.0 2.1x 44.5%
Trident Exploration 114.5 1.2x 30.4%
Crimson Exploration 115.2 1.4x 16.6%
Bear Tracker Energy 66.5 5.8x 164.6%
Crown Rock 115.9 1.4x 23.1%
Chesapeake Energy Assets 755.0 1.3x 22.7%
Energy Alloys 156.7 1.1x 8.6%
Total $1,539.8
2011 Homebuilding Miller Group $ 178.7 1.5x 43.6%
Giant Cement 195.7 1.2x 24.1%
City Ventures 125.0 1.1x n/m
Community Development Capital Group 150.0 n/m n/m
Total $649.4
2012 Europe EMI Music $ 390.5 1.3x 42.1%
Perstorp 132.9 1.1x n/m
Welcome Break 197.5 1.0x n/m
Canberra 167.0 n/m n/m
Total $887.9
________________________________________________
Note: Inception to date net returns through March 31, 2013 for the Funds are 19.9% for mezzanine funds and 14.9% for rescue lending funds. The returns represent weighted average returns for the onshore and offshore vehicles (if
applicable) for the respective flagship funds.
Past performance is not necessarily indicative of future results. See “Important Disclosures” section at the front of the presentation book. The examples cited above represents such flagship funds’ investments in the sectors listed
and are not representative of all investments made by GSO with respect to theme, performance and operating metrics, and it should not be assumed that GSO will make equally successful or comparable investments in future funds.
Blackstone 8
Strong growth driven by investment performance and

diversification
GSO Total AUM Growth(1) Comparison of Selected Business Metrics
($ in billions)
$56
2005 1Q 2013
# of Fund Products 2 34
# of CLOs 10 53
# of Fund LPs
19 143
≥ $25 Million
Top 10 LPs as a
42% 18%
% of Total AUM
$37 % of Capital
41% 80%+
$31 Locked Up
Assets Under
$9 $24
$23 Management $9 $58
$20
($ in Billions)
$14 Products Hedge Hedge Funds, CLOs, SMAs,
Funds Mezzanine Funds,
and Rescue Lending Funds, BDCs,
CLOs Closed End Funds,
2005 2006 2007 2008 2009 2010 2011 2012
Commingled Loan Funds, ETFs
________________________________________________
(1) 2005–2007 data is pro forma the combination of GSO and Blackstone.
Blackstone 9
Consistent improvement across all financial metrics

LTM
($ in millions, unless otherwise noted) 2009 2010 2011 2012 1Q ’13
Assets Under Management ($B)
Fee-Earning AUM $20.4 $25.3 $30.5 $45.4 $46.4
Total AUM 24.2 31.1 37.0 56.4 58.1
Fee Related Earnings

Fee Related Revenues 163 198 243 389 402
Fee Related Expenses 147 162 179 267 279
Fee Related Earnings $16 $36 $64 $123 $123
Fee Margin 10% 18% 26% 32% 31%
Realized Performance Fees 13 108 147 245 335

Realized Performance Comp (10) (59) (80) (134) (179)
Realized Investment Income (15) 10 11 16 18
Pre-Tax Distributable Earnings $4 $94 $142 $250 $298
Economic Income (Loss) $95 $174 $142 $325 $337
Blackstone 10
2013 GSO initiatives
 Capitalize on dislocation in Europe

• Distressed credit investing
• Direct lending to performing credits
 Opportunistically deploy Dry Powder

• $8.0 Billion of Dry Powder as of March 31, 2013
 Continue to launch more “permanent” capital vehicles
• ETFs, closed-end funds, Business Development Company (“BDC”) related
funds
 Develop additional strategic partnerships with limited partners
 Further expand global CLO leadership position
Blackstone 11
Global CLO issuances are starting to return to historical levels
($ in billions)
$97
$89
$75
$53 $54
$50
$41
$25
$13 $15 $16 $14 $14 $14

$12 $12
$9 $7 $8
$4 $5 $4
$1 $2 $1 $0 $4 $2 $1 $0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Expected (1)
U.S. CLO Issuance EUR CLO Issuance
________________________________________________
Source: S&P Capital IQ LCD. EUR CLO Issuance converted using 3/28/13 F/X Rate of 1.2841.
(1) 2013 Expected is based on GSO’s opinion of the current market environment, which is subject to change during the year.
Blackstone 12
BX / GSO historical CLO new issuance
($ in billions)
$3.3
$3.0
$2.8
$1.6 $1.7
$1.5 $1.6
$0.7
$0.4
$0.2
$-
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
(1)
Targeted
________________________________________________
(1) 2013 Targeted is based on GSO’s opinion of the current market environment, which is subject to change during the year.
Blackstone 13
Our Strategic Objectives

 Maintain our investment excellence
• Strive to deliver top quartile, or better, performance
• Exploit our advantages: scale, brand, origination and investment expertise
 Opportunistically raise capital to take advantage of market dislocations
• Complete our second rescue financing fundraise
• Direct Lending in Europe
• CLOs / Leveraged Loans
 Sustain our entrepreneurial culture
• Critical to our success in attracting and retaining top talent
• Committed to a meritocracy
 Maintain a double-digit growth rate
• Highly scalable business model
• The Case for Credit: Attractive Risk-Adjusted Returns
• Leverage the GSO / Blackstone Brand
Blackstone 14
X. Wrap-Up
Blackstone is the world’s leading Alternatives firm
Real Estate Private Equity

$59bn AUM $50bn AUM(1)
Hedge Fund Solutions Tactical Opportunities

$48bn AUM $3bn AUM
Advisory Credit
>$2tn transactions / funds raised $58bn AUM
And the only firm with leadership positions in multiple businesses

________________________________________________
(1) Private Equity excludes Tactical Opportunities.
Blackstone 1
Private Equity
Leadership: The largest fund in the world
Performance: 900 bps per year outperformance for 25 years
Growth: AUM growth of 10% per year over past five years
________________________________________________
Note: Outperformance represents an average over the time period as compared to S&P TRI. Performance represents net returns for Private Equity core funds from inception to present. Past performance is
not necessarily indicative of future results. Please see “Important Disclosures” section at the front of the presentation book for more information, including information regarding the use of market
indices.
Blackstone 2
Real Estate
Leadership: Largest opportunistic investor in the world
Performance: Top decile performance; 1,100 bps per year

outperformance for 20 years
Growth: AUM growth of 17% per year over past five years
________________________________________________
Note: Outperformance represents an average over the time period as compared to NCREIF-ODCE Index. Performance represents net returns for global opportunity funds from inception to present. Past
performance is not necessarily indicative of future results. Please see “Important Disclosures” section at the front of the presentation book for more information, including information regarding the
use of market indices.
Blackstone 3
Hedge Fund Solutions
Leadership: Largest in the world
Performance: 400 bps per year outperformance since 2000 with less
than one-third of the market’s volatility
Growth: AUM growth of 12% per year over past five years; strong
inflows even during the downturn
________________________________________________
Note: Outperformance represents an average over the period as compared to S&P. Performance represents BAAM net core composite, which covers the period from January 2000 to present, although
BAAM’s inception date is September 1990. Past performance is not necessarily indicative of future results. BAAM’s core composite does not include BAAM’s long-only equity, long-biased commodities,
seed, strategic opportunities (external investments) and advisory platforms.
Blackstone 4
Credit
Leadership: One of the world’s largest managers of credit-intensive debt
Performance: Consistent top quartile returns across product categories
 Mezzanine: 20% per year from inception
 Rescue Lending: 15% per year from inception
 Hedge Fund: 9% per year from inception
Growth: AUM growth of 23% per year over past five years(1)
________________________________________________
Note: Performance represents the net returns of the flagship funds from inception to present. Past performance is not necessarily indicative of future results. Please see “Important Disclosures” section at
the front of the presentation book for more information. Top quartile reference applies to funds for which there is publicly available comparative data.
(1) Pro forma the combination of Blackstone and GSO in 2008.
Blackstone 5
Tactical Opportunities
Leadership: First major pool of opportunistic capital
Performance: 14% annual return from inception with high current

yield
Growth: AUM has grown to $2.7 billion in less than two years, with
$4 billion in sight
________________________________________________
Note: Performance represents net return from inception of the business to present. Past performance is not necessarily indicative of future results. Please see “Important Disclosures” section at the front of
the presentation book for more information.
Blackstone 6
Other Businesses
Advisory / Restructuring: Top-ranked restructuring advisor(1) and premier quality

strategic advisory business
Park Hill: Number one fund placement agent(2)
Pátria: Largest independent alternative asset manager in Brazil
Strategic Partners: Global secondaries business with strong track record
________________________________________________
(1) Ranked #1 for 2012 U.S. Completed Restructurings by Thomson Reuters.
(2) Source: Preqin data for current fund-raising mandates.
Blackstone 7
The true power of Blackstone is the way our businesses

work together to make each other better
Real Private Equity and Real Estate have teamed Private
Estate up on many transactions, including Hilton Equity
BREP and Pátria jointly invest in Private Equity and GSO invest in Emdeon,
Brazilian real estate a leading healthcare technology company
Credit
Pátria
(GSO)
Park Hill helps to raise capital for Tac Opps and GSO co-invest in the equity
Pátria’s funds Shared tranche of a GSO-managed CLO
Park
Intellectual Tactical
Hill Capital Opportunities
Advisory worked with Park Hill on the

partial sale of a real estate general Tac Opps and BAAM team up to purchase
partner to an insurance company non-performing residential loans
Hedge Fund
Advisory
Solutions
Advisory and Restructuring worked together

Restructuring has referred investment
on the reorganization and sale of a major Restructuring
opportunities to both BAAM and Tac Opps
sports franchise
________________________________________________
Note: Sharing of information is subject to Blackstone’s internal information wall policy.
Blackstone 8
Case Study: Housing – Sharing of insights across businesses

leads to better investment decisions
 Private Equity group analyzes the impact of the housing rebound on the U.S. economy
 GSO authors white paper with contrarian view that U.S. housing has bottomed
 Real Estate group sees same trend developing and builds housing for rent infrastructure
 Hedge Fund Solutions sees non-performing loan improvement from underlying managers
Real Estate Private Equity Credit

 Bought $4.5 billion of post-foreclosed single  Invested $440 million in Vivint, the largest  Provided more than $600 million in
family homes, improving and leasing home automation services company in financing solutions across several private
North America and second largest market vehicles
 Invested $130 million from Debt Strategies
residential security services provider
platform into residential, across 12 positions  $475 million peak long exposure in hedge
funds to homebuilders and related
industries
Hedge Fund Solutions Tactical Opportunities

 Directed $4.2 billion to focus on distressed  Bought $300 million (face value) of
residential mortgage exposure non-performing residential loans
 Launched new fund to capitalize on specific  Committed $50 million to acquire
opportunity in Mortgage Servicing Rights mortgages through development of
a mortgage REIT vehicle
Invested over $10 billion across the firm on improving housing fundamentals
________________________________________________
Note: Sharing of information is subject to Blackstone’s internal information wall policy.
Blackstone 9
Blackstone’s scale brings significant competitive advantages
 Why is scale important?
• Brand
• Breadth and depth of LP relationships
• Global footprint
• Access to financing through all market cycles
• Speed and information advantage that come with size and diversity
• Ability to gather and share insights from all regions and all asset classes
• Access to broader set of business and government leaders around the world
Blackstone locations
Blackstone 10
Financial asset prices are high; fundamentals are anemic
Five-Year Projected Return
Most Common Overall Return Assumption = 7.5%–8.0%
6.0%
4.5%
4.0%
2.0%
0.0%
Treasuries Investment High Yield Equities 60/40 Portfolio

Grade Bonds
Earning acceptable returns will be challenging

________________________________________________
Source: Goldman Sachs estimates as of January 2013.
Blackstone 11
To outperform, investors will need to:
 Give up liquidity
• Excess liquidity extremely costly
 Increase duration
• Lower IRRs, but longer compounding
 Take more risk
• Using uncorrelated assets to reduce portfolio risk
 Be nimble
• Capitalize on dislocations
 Make idiosyncratic investments
• Not market-driven bets
• Managers who create their own value
These are the defining characteristics of Alternatives

Blackstone 12
The central characteristic of Blackstone’s culture is innovation,

which drives continued strong growth
Total AUM in New Strategies Selected New Strategies

($ in billions)
$218
 Tactical Opportunities
$76 billion
from new products that didn’t  Energy
exist at time of IPO
$71 $76  Real estate debt
$42  Asian real estate
 Latin America
$33
$2  Exchange traded funds
$9 $14
$142
$125 $139  Rescue capital
$70 $100 $95
$86 $84  Hedge fund seeding platform
 Defined contribution
 Hedge fund solutions for individuals
2006 2007 2008 2009 2010 2011 2012 1Q'13
 Secondary LP interests
Existing Strategies New Strategies
Blackstone 13
New distribution: Fundraising in retail channel has increased

tenfold in three years
 While institutional investors have ~20% allocation to alternatives, retail has less than 2%
 Retail / HNW market is $15 trillion in North America alone, which is double the institutional market
 Blackstone has approached this market through existing distribution systems
Retail Fundraising
($ in billions)
$5.9
$2.5 $2.7
$0.6
2009 2010 2011 2012

Blackstone 14
The key competitive advantages in financial

services are Leadership and Culture
Blackstone 15
Blackstone has the most experienced management team

coupled with a deep bench of great young leaders
Steve Schwarzman Tony James

Chairman and CEO President and COO
Age: 66 Age: 62
Tom Hill 28 years at Blackstone (Founder) 11 years at Blackstone Jon Gray
BAAM 31 years of senior management experience 31 years of senior management experience Real Estate
Age: 64 Age: 43
20 years at Blackstone 21 years at Blackstone
34 years of senior management experience Blackstone Management Committee 13 years of senior management experience
Bennett Goodman Joe Baratta

GSO Private Equity
Age: 56 Age: 42
5 years at Blackstone Laurence Tosi Joan Solotar 15 years at Blackstone
23 years of senior management experience 8 years of senior management experience
CFO External Relations & Strategy
Age: 45 Age: 48
5 years at Blackstone 6 years at Blackstone
17 years of senior management experience 10 years of senior management experience
Blackstone 16
The key tenets of Blackstone’s culture:
 Teamwork is paramount
 Be entrepreneurial; think differently; solve problems
 Hierarchy is bad; doors are always open
 Diversity of perspective makes for better decisions
 Keep the small firm feel
 Passion for business
 Craftsmanship and attention to detail
 Robust debate; honest discourse; no excuses
 Ego is dangerous; arrogance inexcusable
 Care: about each other, about clients, about the work you do, about all society’s stakeholders
 Winning is fun
Blackstone 17
We are dedicated to driving outstanding results for investors and clients by

deploying capital and ideas that help businesses succeed and grow
Performance for 2012 and 2013
Private Equity 30% Mezzanine Debt 37%
Energy 103% Rescue Lending 22%
Tactical Opportunities 23% Credit Hedge Funds 19%
Real Estate 51% BAAM 11%
Real Estate Debt 21%
Recent results have been the best yet!

________________________________________________
Note: Returns represent gross annualized returns from 1/1/12 through 3/31/13. Past performance is not necessarily indicative of future results. See “Important Disclosures” section at the front of the
presentation book for more information. Returns for Private Equity and Real Estate represent the returns of the actively investing global flagship funds BCP VI and BREP VII, respectively. Returns for
Energy are the returns for Blackstone Energy Partners. Returns for Tactical Opportunities are the returns for the Tactical Opportunities platform. Returns for Real Estate debt represent the combined
real estate debt strategies hedge fund returns. Returns for Mezzanine Debt, Rescue Lending and Credit Hedge Funds represent the returns of the flagship funds. Returns for BAAM are for the BAAM
core composite, which does not include BAAM’s long-only equity, long-biased commodities, seed, strategic opportunities (external investments) and advisory platforms. Net returns are as follows: 19%
for Private Equity; 91% for Energy; 14% for Tactical Opportunities; 32% for Real Estate; 16% for Real Estate Debt; 27% for Mezzanine Debt; 17% for Rescue Lending; 14% for Credit Hedge Funds; and
10% for BAAM.
Blackstone 18

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2013 Blackstone Investor Day

Agenda – Friday, May 3, 2013

Time Function Location

Agenda – Friday, May 3, 2013

Time Function Location

Historical Performance Fee-Earning AUM Total AUM

$52 Real Estate

$19 $23 $24

Double actual current

If long-term growth is higher (but still well below trend)…

Hypothetical Distributable Earnings Implied stock price:

Blackstone is the largest alternative asset manager in the world,

These principles guide everything we do

Global leader in alternative asset management with $218 billion of AUM

Private Hedge Fund Financial

$52 billion $59 billion $48 billion $58 billion

Note: AUM = Total AUM as of 3/31/13. Blackstone 1

$18 billion $17 billion

Create Value Provide Capital

Assets Under Management

25% Fee-Earning AUM

2006 2007 2008 2009 2010 2011 2012 1Q’13

As value creation accelerates, it drives Performance Fees and Realizations,

Total Invested and Realized

2007 2008 2009 2010 2011 2012 1Q’13 LTM

Invested Realizations Net Realizations

Performance Fee-Earning AUM has quadrupled since 2010, driven by strong

Performance Fee-Earning AUM

$8.8 $35.3 NAV Funds

Realized Performance Fees are rapidly approaching pre-crisis levels while

Realized Performance Fees Fee-Earning AUM

Realization activity is driving a shift in the earnings mix towards a greater

$1,581 $1,585 $793

$194 $272 $225

$461 $478 $546

Fee Related Earnings Net Realizations Net Unrealized

Sustained investment performance strengthens an already high quality balance

$5.93 Total Net Asset Value

Total Cash and

Blackstone’s competitive positioning, operating fundamentals and secular

 Market Dynamics: Barriers to entry

Blackstone is uniquely positioned to capitalize on global opportunities to

Balanced & Strong

GAAP Statement of Operations

Reconciliation of GAAP to Non-GAAP Measures

Reconciliation of GAAP to Non-GAAP Measures – Notes

Earnings Composition – Calculation of Net Realizations and Net Unrealized

($ in thousands) 2009 2010 2011 2012 1Q'13 LTM

Realized Incentive Fees $ 44,812 $ 116,700 $ 89,029 $ 301,464 $ 320,912

Unrealized Incentive Fees $ 65,563 $ 107,624 $ (24,928) $ (29,311) $ 10,323

Blackstone Real Estate Overview

 Blackstone Real Estate

Blackstone Real Estate Partners (“BREP”) has consistently delivered solid

BREP Global Funds as of March 31, 2013

Investment Invested BREP

Total $27,943,396 16%

Investment success has translated into remarkable fundraising success with

Fund Closing Date Size ($bn)

Blackstone Real Estate Fundraising Total 2007-13 $40.6

Fee Earning Real Estate AUM Total Real Estate AUM

Key Questions about Blackstone Real Estate

 Why Such Significant Capital Deployment?

 Will You and Can You Exit Current Holdings?