Blackstone's Gray Sees Italy Crisis Creating Chance to Buy

(Bloomberg) -- Blackstone Group LP President Jon Gray said the crisis in Italy may spur investment opportunities, but it could lead to slower growth and more volatility in Europe.

“Italy trades off, a bunch of things trade off, and that could create a bunch of opportunity,” Gray said Wednesday at Deutsche Bank’s Global Financial Services Conference in New York.

Asked if he would buy Italian assets now, Gray said: “Sure. It’s a function of price. If you look back after Brexit, in our real estate business we bought a couple of 100 million pounds of warehouses. It was literally 10 days after Brexit. We tend to focus more on long-term value than short-term market movements.”

Gray said the broader issue is the challenge facing the European Union.

“Stepping back and looking at Europe you’d say the set up of a monetary union without a fiscal union is hard,” he said. “And it’s going to lead to volatility along the way. I think that will continue. It creates more of a risk premium for investing in Europe. It slows the rate of growth.”

Italy exiting the EU is unlikely, he said.

“The Europeans do have a pretty big incentive to stay together,” he said. “And even in Italy, if you polled the population, they do want to stay in the Euro. I think Europe will find a way to hold it together albeit with slower growth and more volatility.”

Blackstone is the world’s largest alternative investment manager with about $450 billion of assets.

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