v2.4.0.6

SEGMENT REPORTING | 6 Months Ended
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Jun. 30, 2012
SEGMENT REPORTING |
17. | SEGMENT REPORTING
Blackstone transacts its primary business in the United States and substantially all of its revenues are generated domestically. Blackstone conducts its alternative asset management and financial advisory businesses through five segments:
| • |  | Private Equity — Blackstone’s Private Equity segment comprises its management of private equity funds and certain multi-asset class investment funds.
| • |  | Real Estate — Blackstone’s Real Estate segment primarily comprises its management of general opportunistic real estate funds and internationally focused opportunistic real estate funds. In addition, the segment has debt investment funds targeting non-controlling real estate debt-related investment opportunities in the public and private markets, primarily in the United States and Europe.
| • |  | Hedge Fund Solutions — Blackstone’s Hedge Fund Solutions segment is comprised of Blackstone Alternative Asset Management (“BAAM”), an institutional solutions provider utilizing hedge funds across a variety of strategies.
| • |  | Credit Businesses — Blackstone’s Credit Businesses segment is comprised principally of GSO and manages credit-oriented funds, CLOs, credit-focused separately managed accounts and publicly registered debt-focused investment companies.
| • |  | Financial Advisory — Blackstone’s Financial Advisory segment comprises its financial advisory services, restructuring and reorganization advisory services and Park Hill Group, which provides fund placement services for alternative investment funds.
These business segments are differentiated by their various sources of income. The Private Equity, Real Estate, Hedge Fund Solutions and Credit Businesses segments primarily earn their income from management fees and investment returns on assets under management, while the Financial Advisory segment primarily earns its income from fees related to investment banking services and advice and fund placement services. Blackstone uses Economic Income (“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 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. Prior to June 30, 2012, EI had been called Economic Net Income. The renaming of this measure did not change any of the previously reported amounts. Economic Net Income (“ENI”) now represents EI adjusted to include current period taxes. Taxes represent the current tax provision (benefit) calculated on Income (Loss) Before Provision for Taxes. Management makes operating decisions and assesses the performance of each of Blackstone’s business segments based on financial and operating metrics and data that is presented without the consolidation of any of the Blackstone Funds that are consolidated into the Condensed Consolidated Financial Statements. Consequently, all segment data excludes the assets, liabilities and operating results related to the Blackstone Funds. The following table presents the financial data for Blackstone’s five segments as of and for the three months ended June 30, 2012 and 2011:
|  | Three Months Ended June 30, 2012 |
|  | Private Equity |  |  | Real Estate |  |  | Hedge Fund Solutions |  |  | Credit Businesses |  |  | Financial Advisory |  |  | Total Segments |
Segment Revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Management and Advisory Fees, Net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Base Management Fees |  | $ | 87,475 |  |  | $ | 127,817 |  |  | $ | 84,278 |  |  | $ | 81,774 |  |  | $ | — |  |  | $ | 381,344 |
Advisory Fees |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 93,372 |  |  |  | 93,372 |
Transaction and Other Fees, Net |  |  | 14,951 |  |  |  | 25,151 |  |  |  | 65 |  |  |  | 9,184 |  |  |  | 102 |  |  |  | 49,453 |
Management Fee Offsets |  |  | (672 | ) |  |  | (5,357 | ) |  |  | (375 | ) |  |  | (1,569 | ) |  |  | — |  |  |  | (7,973 | )
Total Management and Advisory Fees, Net |  |  | 101,754 |  |  |  | 147,611 |  |  |  | 83,968 |  |  |  | 89,389 |  |  |  | 93,474 |  |  |  | 516,196 |
Performance Fees |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 28,781 |  |  |  | 13,539 |  |  |  | — |  |  |  | 13,609 |  |  |  | — |  |  |  | 55,929 |
Incentive Fees |  |  | — |  |  |  | 7,766 |  |  |  | 1,175 |  |  |  | 2,751 |  |  |  | — |  |  |  | 11,692 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | (87,893 | ) |  |  | 144,510 |  |  |  | — |  |  |  | 27,673 |  |  |  | — |  |  |  | 84,290 |
Incentive Fees |  |  | — |  |  |  | (1,526 | ) |  |  | (10,981 | ) |  |  | (4,567 | ) |  |  | — |  |  |  | (17,074 | )
Total Performance Fees |  |  | (59,112 | ) |  |  | 164,289 |  |  |  | (9,806 | ) |  |  | 39,466 |  |  |  | — |  |  |  | 134,837 |
Investment Income (Loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  | (6,195 | ) |  |  | 9,067 |  |  |  | 929 |  |  |  | 5,638 |  |  |  | (79 | ) |  |  | 9,360 |
Unrealized |  |  | (28,337 | ) |  |  | 14,944 |  |  |  | (3,636 | ) |  |  | (9,156 | ) |  |  | 561 |  |  |  | (25,624 | )
Total Investment Income |  |  | (34,532 | ) |  |  | 24,011 |  |  |  | (2,707 | ) |  |  | (3,518 | ) |  |  | 482 |  |  |  | (16,264 | )
Interest and Dividend Revenue |  |  | 3,114 |  |  |  | 3,277 |  |  |  | 495 |  |  |  | 1,752 |  |  |  | 1,753 |  |  |  | 10,391 |
Other |  |  | 562 |  |  |  | (590 | ) |  |  | 27 |  |  |  | (787 | ) |  |  | (40 | ) |  |  | (828 | )
Total Revenues |  |  | 11,786 |  |  |  | 338,598 |  |  |  | 71,977 |  |  |  | 126,302 |  |  |  | 95,669 |  |  |  | 644,332 |
Expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation and Benefits |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation |  |  | 53,775 |  |  |  | 76,576 |  |  |  | 34,559 |  |  |  | 42,845 |  |  |  | 61,129 |  |  |  | 268,884 |
Performance Fee Compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 804 |  |  |  | 3,401 |  |  |  | — |  |  |  | 3,694 |  |  |  | — |  |  |  | 7,899 |
Incentive Fees |  |  | — |  |  |  | 3,871 |  |  |  | (345 | ) |  |  | 2,049 |  |  |  | — |  |  |  | 5,575 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | (8,259 | ) |  |  | 31,677 |  |  |  | — |  |  |  | 13,397 |  |  |  | — |  |  |  | 36,815 |
Incentive Fees |  |  | — |  |  |  | (629 | ) |  |  | (2,820 | ) |  |  | (6,147 | ) |  |  | — |  |  |  | (9,596 | )
Total Compensation and Benefits |  |  | 46,320 |  |  |  | 114,896 |  |  |  | 31,394 |  |  |  | 55,838 |  |  |  | 61,129 |  |  |  | 309,577 |
Other Operating Expenses |  |  | 30,521 |  |  |  | 26,560 |  |  |  | 14,506 |  |  |  | 15,749 |  |  |  | 25,702 |  |  |  | 113,038 |
Total Expenses |  |  | 76,841 |  |  |  | 141,456 |  |  |  | 45,900 |  |  |  | 71,587 |  |  |  | 86,831 |  |  |  | 422,615 |
Economic Income (Loss) |  | $ | (65,055 | ) |  | $ | 197,142 |  |  | $ | 26,077 |  |  | $ | 54,715 |  |  | $ | 8,838 |  |  | $ | 221,717 |
|  | Three Months Ended June 30, 2011 |
|  | Private Equity |  |  | Real Estate |  |  | Hedge Fund Solutions |  |  | Credit Businesses |  |  | Financial Advisory |  |  | Total Segments |
Segment Revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Management and Advisory Fees, Net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Base Management Fees |  | $ | 82,297 |  |  | $ | 97,467 |  |  | $ | 79,290 |  |  | $ | 57,420 |  |  | $ | — |  |  | $ | 316,474 |
Advisory Fees |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 102,243 |  |  |  | 102,243 |
Transaction and Other Fees, Net |  |  | 52,353 |  |  |  | 49,288 |  |  |  | 861 |  |  |  | 849 |  |  |  | 210 |  |  |  | 103,561 |
Management Fee Offsets |  |  | (7,629 | ) |  |  | (745 | ) |  |  | (196 | ) |  |  | (105 | ) |  |  | — |  |  |  | (8,675 | )
Total Management and Advisory Fees, Net |  |  | 127,021 |  |  |  | 146,010 |  |  |  | 79,955 |  |  |  | 58,164 |  |  |  | 102,453 |  |  |  | 513,603 |
Performance Fees |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 1,362 |  |  |  | 11,798 |  |  |  | — |  |  |  | 29,592 |  |  |  | — |  |  |  | 42,752 |
Incentive Fees |  |  | — |  |  |  | 9,034 |  |  |  | 667 |  |  |  | 7,762 |  |  |  | — |  |  |  | 17,463 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 187,190 |  |  |  | 433,280 |  |  |  | — |  |  |  | (9,313 | ) |  |  | — |  |  |  | 611,157 |
Incentive Fees |  |  | — |  |  |  | (3,822 | ) |  |  | 3,441 |  |  |  | 2,067 |  |  |  | — |  |  |  | 1,686 |
Total Performance Fees |  |  | 188,552 |  |  |  | 450,290 |  |  |  | 4,108 |  |  |  | 30,108 |  |  |  | — |  |  |  | 673,058 |
Investment Income (Loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  | 3,021 |  |  |  | 11,394 |  |  |  | 12,855 |  |  |  | 3,236 |  |  |  | 226 |  |  |  | 30,732 |
Unrealized |  |  | 76,947 |  |  |  | 37,332 |  |  |  | (12,864 | ) |  |  | 5,437 |  |  |  | (15 | ) |  |  | 106,837 |
Total Investment Income (Loss) |  |  | 79,968 |  |  |  | 48,726 |  |  |  | (9 | ) |  |  | 8,673 |  |  |  | 211 |  |  |  | 137,569 |
Interest and Dividend Revenue |  |  | 3,197 |  |  |  | 2,989 |  |  |  | 472 |  |  |  | 902 |  |  |  | 1,723 |  |  |  | 9,283 |
Other |  |  | 665 |  |  |  | 515 |  |  |  | (38 | ) |  |  | (47 | ) |  |  | 33 |  |  |  | 1,128 |
Total Revenues |  |  | 399,403 |  |  |  | 648,530 |  |  |  | 84,488 |  |  |  | 97,800 |  |  |  | 104,420 |  |  |  | 1,334,641 |
Expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation and Benefits |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation |  |  | 64,633 |  |  |  | 70,651 |  |  |  | 31,674 |  |  |  | 33,071 |  |  |  | 72,363 |  |  |  | 272,392 |
Performance Fee Compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 49 |  |  |  | 5,095 |  |  |  | — |  |  |  | 13,531 |  |  |  | — |  |  |  | 18,675 |
Incentive Fees |  |  | — |  |  |  | 4,287 |  |  |  | 253 |  |  |  | 4,496 |  |  |  | — |  |  |  | 9,036 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 29,309 |  |  |  | 92,392 |  |  |  | — |  |  |  | 2,012 |  |  |  | — |  |  |  | 123,713 |
Incentive Fees |  |  | — |  |  |  | (1,371 | ) |  |  | 2,955 |  |  |  | (7,200 | ) |  |  | — |  |  |  | (5,616 | )
Total Compensation and Benefits |  |  | 93,991 |  |  |  | 171,054 |  |  |  | 34,882 |  |  |  | 45,910 |  |  |  | 72,363 |  |  |  | 418,200 |
Other Operating Expenses |  |  | 30,124 |  |  |  | 22,971 |  |  |  | 16,075 |  |  |  | 10,226 |  |  |  | 19,967 |  |  |  | 99,363 |
Total Expenses |  |  | 124,115 |  |  |  | 194,025 |  |  |  | 50,957 |  |  |  | 56,136 |  |  |  | 92,330 |  |  |  | 517,563 |
Economic Income |  | $ | 275,288 |  |  | $ | 454,505 |  |  | $ | 33,531 |  |  | $ | 41,664 |  |  | $ | 12,090 |  |  | $ | 817,078 |
The following table reconciles the Total Segments to Blackstone’s Income (Loss) Before Provision for Taxes for the three months ended June 30, 2012 and 2011:
|  | Three Months Ended June 30, 2012 |  |  | Three Months Ended June 30, 2011 |
|  | Total Segments |  |  | Consolidation Adjustments and Reconciling Items |  |  | Blackstone Consolidated |  |  | Total Segments |  |  | Consolidation Adjustments and Reconciling Items |  |  | Blackstone Consolidated |
Revenues |  | $ | 644,332 |  |  | $ | (17,129 | )(a) |  | $ | 627,203 |  |  | $ | 1,334,641 |  |  | $ | (26,360 | )(a) |  | $ | 1,308,281 |
Expenses |  | $ | 422,615 |  |  | $ | 317,204 | (b) |  | $ | 739,819 |  |  | $ | 517,563 |  |  | $ | 467,268 | (b) |  | $ | 984,831 |
Other Income |  | $ | — |  |  | $ | 248,230 | (c) |  | $ | 248,230 |  |  | $ | — |  |  | $ | (74,654 | )(c) |  | $ | (74,654 | )
Economic Income |  | $ | 221,717 |  |  | $ | (86,103 | )(d) |  | $ | 135,614 |  |  | $ | 817,078 |  |  | $ | (568,282 | )(d) |  | $ | 248,796 |
(a) | The Revenues adjustment principally represents management and performance fees earned from Blackstone Funds which were eliminated in consolidation to arrive at Blackstone consolidated revenues.
(b) | The Expenses adjustment represents the addition of expenses of the consolidated Blackstone Funds to the Blackstone unconsolidated expenses, amortization of intangibles and expenses related to transaction-related equity-based compensation to arrive at Blackstone consolidated expenses.
(c) | The Other Income adjustment results from the following:
|  | Three Months Ended June 30, |
|  | 2012 |  |  | 2011 |
Fund Management Fees and Performance Fees Eliminated in Consolidation |  | $ | 15,892 |  |  | $ | 24,416 |
Fund Expenses Added in Consolidation |  |  | 17,170 |  |  |  | 403 |
Non-Controlling Interests in Income (Loss) of Consolidated Entities |  |  | 222,268 |  |  |  | (92,548 | )
Transaction-Related Other Income |  |  | (7,100 | ) |  |  | (6,925 | )
Total Consolidation Adjustments and Reconciling Items |  | $ | 248,230 |  |  | $ | (74,654 | )
(d) | The reconciliation of Economic Income to Income (Loss) Before Provision (Benefit) for Taxes as reported in the Condensed Consolidated Statements of Operations consists of the following:
|  | Three Months Ended June 30, |
|  | 2012 |  |  | 2011 |
Economic Income |  | $ | 221,717 |  |  | $ | 817,078 |
Adjustments |  |  |  |  |  |  |  |
Amortization of Intangibles |  |  | (39,435 | ) |  |  | (44,905 | )
IPO and Acquisition-Related Charges |  |  | (268,936 | ) |  |  | (430,829 | )
Non-Controlling Interests in Income (Loss) of Consolidated Entities |  |  | 222,268 |  |  |  | (92,548 | )
Total Consolidation Adjustments and Reconciling Items |  |  | (86,103 | ) |  |  | (568,282 | )
Income Before Provision (Benefit) for Taxes |  | $ | 135,614 |  |  | $ | 248,796 |
The following table presents financial data for Blackstone’s five segments for the six months ended June 30, 2012 and 2011:
|  | June 30, 2012 and the Six Months Then Ended |
|  | Private Equity |  |  | Real Estate |  |  | Hedge Fund Solutions |  |  | Credit Businesses |  |  | Financial Advisory |  |  | Total Segments |
Segment Revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Management and Advisory Fees, Net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Base Management Fees |  | $ | 173,264 |  |  | $ | 275,619 |  |  | $ | 166,099 |  |  | $ | 161,868 |  |  | $ | — |  |  | $ | 776,850 |
Advisory Fees |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 169,218 |  |  |  | 169,218 |
Transaction and Other Fees, Net |  |  | 33,048 |  |  |  | 39,563 |  |  |  | 157 |  |  |  | 14,909 |  |  |  | 247 |  |  |  | 87,924 |
Management Fee Offsets |  |  | (4,454 | ) |  |  | (13,984 | ) |  |  | (710 | ) |  |  | (1,875 | ) |  |  | — |  |  |  | (21,023 | )
Total Management and Advisory Fees |  |  | 201,858 |  |  |  | 301,198 |  |  |  | 165,546 |  |  |  | 174,902 |  |  |  | 169,465 |  |  |  | 1,012,969 |
Performance Fees |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 32,714 |  |  |  | 22,156 |  |  |  | — |  |  |  | 14,619 |  |  |  | — |  |  |  | 69,489 |
Incentive Fees |  |  | — |  |  |  | 7,765 |  |  |  | 4,473 |  |  |  | 4,733 |  |  |  | — |  |  |  | 16,971 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | (53,842 | ) |  |  | 366,010 |  |  |  | — |  |  |  | 70,918 |  |  |  | — |  |  |  | 383,086 |
Incentive Fees |  |  | — |  |  |  | 6,388 |  |  |  | 12,206 |  |  |  | 32,453 |  |  |  | — |  |  |  | 51,047 |
Total Performance Fees |  |  | (21,128 | ) |  |  | 402,319 |  |  |  | 16,679 |  |  |  | 122,723 |  |  |  | — |  |  |  | 520,593 |
Investment Income (Loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  | 7,716 |  |  |  | 16,879 |  |  |  | 1,432 |  |  |  | 6,321 |  |  |  | 504 |  |  |  | 32,852 |
Unrealized |  |  | (11,868 | ) |  |  | 40,856 |  |  |  | 4,735 |  |  |  | 55 |  |  |  | 512 |  |  |  | 34,290 |
Total Investment Income (Loss) |  |  | (4,152 | ) |  |  | 57,735 |  |  |  | 6,167 |  |  |  | 6,376 |  |  |  | 1,016 |  |  |  | 67,142 |
Interest and Dividend Revenue |  |  | 5,534 |  |  |  | 5,829 |  |  |  | 881 |  |  |  | 4,177 |  |  |  | 3,315 |  |  |  | 19,736 |
Other |  |  | 347 |  |  |  | (1,299 | ) |  |  | (100 | ) |  |  | (1,025 | ) |  |  | 42 |  |  |  | (2,035 | )
Total Revenues |  |  | 182,459 |  |  |  | 765,782 |  |  |  | 189,173 |  |  |  | 307,153 |  |  |  | 173,838 |  |  |  | 1,618,405 |
Expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation and Benefits |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation |  |  | 106,322 |  |  |  | 145,465 |  |  |  | 62,792 |  |  |  | 79,988 |  |  |  | 129,089 |  |  |  | 523,656 |
Performance Fee Compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 1,124 |  |  |  | 7,478 |  |  |  | — |  |  |  | 7,235 |  |  |  | — |  |  |  | 15,837 |
Incentive Fees |  |  | — |  |  |  | 3,873 |  |  |  | 1,033 |  |  |  | 4,921 |  |  |  | — |  |  |  | 9,827 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | (9,311 | ) |  |  | 85,952 |  |  |  | — |  |  |  | 44,717 |  |  |  | — |  |  |  | 121,358 |
Incentive Fees |  |  | — |  |  |  | 3,139 |  |  |  | 4,474 |  |  |  | (4,430 | ) |  |  | — |  |  |  | 3,183 |
Total Compensation and Benefits |  |  | 98,135 |  |  |  | 245,907 |  |  |  | 68,299 |  |  |  | 132,431 |  |  |  | 129,089 |  |  |  | 673,861 |
Other Operating Expenses |  |  | 59,402 |  |  |  | 55,484 |  |  |  | 28,440 |  |  |  | 32,845 |  |  |  | 46,388 |  |  |  | 222,559 |
Total Expenses |  |  | 157,537 |  |  |  | 301,391 |  |  |  | 96,739 |  |  |  | 165,276 |  |  |  | 175,477 |  |  |  | 896,420 |
Economic Income |  | $ | 24,922 |  |  | $ | 464,391 |  |  | $ | 92,434 |  |  | $ | 141,877 |  |  | $ | (1,639 | ) |  | $ | 721,985 |
Segment Assets as of June 30, 2012 |  | $ | 3,736,660 |  |  | $ | 4,495,602 |  |  | $ | 794,310 |  |  | $ | 1,881,416 |  |  | $ | 575,373 |  |  | $ | 11,483,361 |
|  | Six Months Ended June 30, 2011 |
|  | Private Equity |  |  | Real Estate |  |  | Hedge Fund Solutions |  |  | Credit Businesses |  |  | Financial Advisory |  |  | Total Segments |
Segment Revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Management and Advisory Fees, Net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Base Management Fees |  | $ | 162,232 |  |  | $ | 192,906 |  |  | $ | 154,902 |  |  | $ | 112,021 |  |  | $ | — |  |  | $ | 622,061 |
Advisory Fees |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 172,495 |  |  |  | 172,495 |
Transaction and Other Fees, Net |  |  | 87,695 |  |  |  | 70,831 |  |  |  | 1,588 |  |  |  | 1,594 |  |  |  | 216 |  |  |  | 161,924 |
Management Fee Offsets |  |  | (15,518 | ) |  |  | (1,250 | ) |  |  | (320 | ) |  |  | (123 | ) |  |  | — |  |  |  | (17,211 | )
Total Management and Advisory Fees |  |  | 234,409 |  |  |  | 262,487 |  |  |  | 156,170 |  |  |  | 113,492 |  |  |  | 172,711 |  |  |  | 939,269 |
Performance Fees |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 83,751 |  |  |  | 14,169 |  |  |  | — |  |  |  | 38,233 |  |  |  | — |  |  |  | 136,153 |
Incentive Fees |  |  | — |  |  |  | 9,256 |  |  |  | 1,560 |  |  |  | 8,846 |  |  |  | — |  |  |  | 19,662 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 219,727 |  |  |  | 794,726 |  |  |  | — |  |  |  | 28,852 |  |  |  | — |  |  |  | 1,043,305 |
Incentive Fees |  |  | — |  |  |  | 2,836 |  |  |  | 22,694 |  |  |  | 49,205 |  |  |  | — |  |  |  | 74,735 |
Total Performance Fees |  |  | 303,478 |  |  |  | 820,987 |  |  |  | 24,254 |  |  |  | 125,136 |  |  |  | — |  |  |  | 1,273,855 |
Investment Income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  | 20,928 |  |  |  | 14,313 |  |  |  | 14,196 |  |  |  | 4,471 |  |  |  | 323 |  |  |  | 54,231 |
Unrealized |  |  | 106,073 |  |  |  | 98,738 |  |  |  | (5,744 | ) |  |  | 9,969 |  |  |  | 378 |  |  |  | 209,414 |
Total Investment Income |  |  | 127,001 |  |  |  | 113,051 |  |  |  | 8,452 |  |  |  | 14,440 |  |  |  | 701 |  |  |  | 263,645 |
Interest and Dividend Revenue |  |  | 6,702 |  |  |  | 6,277 |  |  |  | 988 |  |  |  | 1,355 |  |  |  | 3,409 |  |  |  | 18,731 |
Other |  |  | 1,476 |  |  |  | 1,375 |  |  |  | 66 |  |  |  | 51 |  |  |  | 419 |  |  |  | 3,387 |
Total Revenues |  |  | 673,066 |  |  |  | 1,204,177 |  |  |  | 189,930 |  |  |  | 254,474 |  |  |  | 177,240 |  |  |  | 2,498,887 |
Expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation and Benefits |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Compensation |  |  | 119,557 |  |  |  | 128,278 |  |  |  | 59,767 |  |  |  | 62,620 |  |  |  | 126,702 |  |  |  | 496,924 |
Performance Fee Compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Realized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 7,767 |  |  |  | 6,221 |  |  |  | — |  |  |  | 18,256 |  |  |  | — |  |  |  | 32,244 |
Incentive Fees |  |  | — |  |  |  | 4,391 |  |  |  | 553 |  |  |  | 5,066 |  |  |  | — |  |  |  | 10,010 |
Unrealized |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Carried Interest |  |  | 34,773 |  |  |  | 193,350 |  |  |  | — |  |  |  | 21,545 |  |  |  | — |  |  |  | 249,668 |
Incentive Fees |  |  | — |  |  |  | 4,172 |  |  |  | 8,313 |  |  |  | 18,469 |  |  |  | — |  |  |  | 30,954 |
Total Compensation and Benefits |  |  | 162,097 |  |  |  | 336,412 |  |  |  | 68,633 |  |  |  | 125,956 |  |  |  | 126,702 |  |  |  | 819,800 |
Other Operating Expenses |  |  | 58,837 |  |  |  | 51,337 |  |  |  | 29,083 |  |  |  | 25,583 |  |  |  | 37,498 |  |  |  | 202,338 |
Total Expenses |  |  | 220,934 |  |  |  | 387,749 |  |  |  | 97,716 |  |  |  | 151,539 |  |  |  | 164,200 |  |  |  | 1,022,138 |
Economic Income |  | $ | 452,132 |  |  | $ | 816,428 |  |  | $ | 92,214 |  |  | $ | 102,935 |  |  | $ | 13,040 |  |  | $ | 1,476,749 |
The following table reconciles the Total Segments to Blackstone’s Income (Loss) Before Provision for Taxes and Total Assets as of and for the six months ended June 30, 2012 and 2011:
|  | June 30, 2012 and the Six Months Then Ended |  |  | Six Months Ended June 30, 2011 |
|  | Total Segments |  |  | Consolidation Adjustments and Reconciling Items |  |  | Blackstone Consolidated |  |  | Total Segments |  |  | Consolidation Adjustments and Reconciling Items |  |  | Blackstone Consolidated |
Revenues |  | $ | 1,618,405 |  |  | $ | (39,166 | )(a) |  | $ | 1,579,239 |  |  | $ | 2,498,887 |  |  | $ | (37,337 | )(a) |  | $ | 2,461,550 |
Expenses |  | $ | 896,420 |  |  | $ | 627,192 | (b) |  | $ | 1,523,612 |  |  | $ | 1,022,138 |  |  | $ | 953,557 | (b) |  | $ | 1,975,695 |
Other Income |  | $ | — |  |  | $ | 536,372 | (c) |  | $ | 536,372 |  |  | $ | — |  |  | $ | (119,845 | )(c) |  | $ | (119,845 | )
Economic Income |  | $ | 721,985 |  |  | $ | (129,986 | )(d) |  | $ | 591,999 |  |  | $ | 1,476,749 |  |  | $ | (1,110,739 | )(d) |  | $ | 366,010 |
Total Assets |  | $ | 11,483,361 |  |  | $ | 14,659,209 | (e) |  | $ | 26,142,570 |  |  |  |  |  |  |  |  |  |  |  |  |
(a) | The Revenues adjustment principally represents management and performance fees earned from Blackstone Funds which were eliminated in consolidation to arrive at Blackstone consolidated revenues.
(b) | The Expenses adjustment represents the addition of expenses of the consolidated Blackstone Funds to the Blackstone unconsolidated expenses, amortization of intangibles and expenses related to transaction-related equity-based compensation to arrive at Blackstone consolidated expenses.
(c) | The Other Income adjustment results from the following:
|  | Six Months Ended June 30, |
|  | 2012 |  |  | 2011 |
Fund Management Fees and Performance Fees Eliminated in Consolidation |  | $ | 36,490 |  |  | $ | 33,519 |
Fund Expenses Added in Consolidation |  |  | 39,877 |  |  |  | 12,616 |
Non-Controlling Interests in Income (Loss) of Consolidated Entities |  |  | 474,170 |  |  |  | (163,604 | )
Transactional Other Income |  |  | (14,165 | ) |  |  | (2,376 | )
Total Consolidation Adjustments and Reconciling Items |  | $ | 536,372 |  |  | $ | (119,845 | )
(d) | The reconciliation of Economic Income to Income (Loss) Before Provision (Benefit) for Taxes as reported in the Condensed Consolidated Statements of Operations consists of the following:
|  | Six Months Ended June 30, |
|  | 2012 |  |  | 2011 |
Economic Income |  | $ | 721,985 |  |  | $ | 1,476,749 |
Adjustments |  |  |  |  |  |  |  |
Amortization of Intangibles |  |  | (90,323 | ) |  |  | (89,079 | )
IPO and Acquisition-Related Charges |  |  | (513,833 | ) |  |  | (858,056 | )
Non-Controlling Interests in Income (Loss) of Consolidated Entities |  |  | 474,170 |  |  |  | (163,604 | )
Total Consolidation Adjustments and Reconciling Items |  |  | (129,986 | ) |  |  | (1,110,739 | )
Income (Loss) Before Provision for Taxes |  | $ | 591,999 |  |  | $ | 366,010 |
(e) | The Total Assets adjustment represents the addition of assets of the consolidated Blackstone Funds to the Blackstone unconsolidated assets to arrive at Blackstone consolidated assets.

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 131 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 + Details
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