Blackstone has partnered with US retirement plan administrator Empower as alternative asset managers push to gain access to 401(k) pension plans.
The $1.2tn (£891.9bn) alternatives asset manager has joined Empower’s investment partnership programme, which is designed to help defined contribution plans incorporate exposure to private equity, private credit, private infrastructure and private real estate through collective investment trust (CIT) structures.
Blackstone will provide Empower’s customers with access to its funds through CITs, which are widely used in 401(k) plans and other defined contribution pension schemes.
“Bringing Blackstone’s leading investment strategies into defined contribution plans enables retirement savers to access the same opportunities previously only available to institutional investors,” said Jon Gray, president and chief operating officer at Blackstone.
The move comes after Blackstone launched a dedicated business unit in October focused on retirement solutions, as it pushes to bring private markets access to workplace savings vehicles.
The new division, which sits within its private wealth business, will seek opportunities through strategic partnerships, product innovation and investor education. The business unit is headed by Heather von Zuben, global head of retirement solutions.
“Opening private markets to a broader universe of individual investors is an important evolution in how Americans can benefit from enhanced returns and diversification as they look to build wealth for the future,” said Von Zuben.
Since August, alternative managers have been looking to gain access to 401(k) retirement accounts after President Donald Trump signed an executive order allowing private markets investments to be included in the plans.
“Our goal is to bring the power of private market investing, delivered through advice and risk-appropriate structures, to millions of Americans who previously lacked access,” said Edmund F. Murphy III, president and chief executive of Empower. “Our private market investing platform is built by the world’s best asset managers. Blackstone’s involvement significantly bolsters the opportunities available to retirement savers.”
Empower structures private markets retirement funds that companies can offer to their employees.
The move by Blackstone comes as Robert Wolfe, CBEC, managing director and wealth management adviser at Apollon Wealth Management, told Alternative Credit Investor that managers are converging on a common blueprint for bringing private markets into 401(k)s. This includes embedding them in multi-asset default options, delivering them through institutional wrappers such as collective investment trusts, and using evergreen or semi-liquid fund structures to manage liquidity needs.
Several firms have already begun moving in this direction. Great Gray has partnered with BlackRock on a target-date series using a custom glidepath, with a private markets sleeve accessed through a CIT that invests primarily in BlackRock’s evergreen interval fund.
