Pretty much defacto insolvency. More a liquidity issue though. Homes and buildings have value but are not very liquid. Can takes months or years to liquidate. If everyone wants their money out of property at the same time, the values sink and the management has to liquidate the assets and/or borrow against the portfolio and pass the risk onto others. But the good new is FTX can buy the land for newly minted crypto coins.
Thank God there’s a robust market for my Bored Ape NFTs
I think the problem here isn’t a question of whether Blackstone has a significant amount of money invested in real estate, but the current VALUE of that real estate at present. If it’s worth less than they planned, reported or ‘banked on’ then they’ve hit the solvency limit of investments. It would be illuminating to see exactly how much of that fund is actually ‘invested’ in real estate.