It was founded in 1985 as a mergers and acquisitions firm by Peter Peterson and Stephen Schwarzman, who had previously worked together at Lehman Brothers.

[6] Prominent investment banker Roger C. Altman, another Lehman veteran, left his position as a managing director of Lehman Brothers to join Peterson and Schwarzman at Blackstone in 1987, but left in 1992 to join the Clinton administration as Deputy Treasury Secretary and later founded advisory investment bank Evercore Partners in 1995.

[8][9] From the outset in 1985, Schwarzman and Peterson planned to enter the private equity business but had difficulty in raising their first fund because neither had ever led a leveraged buyout.

[2]: 45–56  Blackstone finalized fundraising for its first private equity fund in the aftermath of Black Monday, the October 1987 global stock market crash.

After two years of providing strictly advisory services, Blackstone decided to pursue a merchant banking model after its founders determined that many situations required an investment partner rather than just an advisor.

The two founders, who had previously run the mortgage-backed securities divisions at First Boston and Lehman Brothers, respectively, initially joined Blackstone to manage an investment fund and provide advice to financial institutions.

[2]: 144–147  He left Blackstone in 1999 to start his own private equity firm, Heartland Industrial Partners, based in Greenwich, Connecticut.

[16] That same year, Blackstone partnered with Salomon Brothers to raise $600 million to acquire distressed thrifts in the midst of the savings and loan crisis.

[26] Blackstone made a number of notable investments in the early and mid-1990s, including Great Lakes Dredge and Dock Company (1991), Six Flags (1991), US Radio (1994), Centerplate (1995), MEGA Brands (1996).

It brought in five professionals, led by Howard Gellis from Nomura Holding America's Leveraged Capital Group, to manage the business.

[2]: 145–146 Blackstone's investments in telecommunications businesses—four cable TV systems in rural areas (TW Fanch 1 and 2, Bresnan Communications and Intermedia Partners IV) and a cell phone operator in the Rocky Mountain states (CommNet Cellular) were among the most successful of the era, generating $1.5 billion of profits for Blackstone's funds.

[42] With a significant amount of capital in its new fund, Blackstone was one of a handful of private equity investors capable of completing large transactions in the adverse conditions of the early 2000s recession.

At the end of 2002, Blackstone, together with Thomas H. Lee Partners and Bain Capital, acquired Houghton Mifflin Company for $1.28 billion.

[52] Extended Stay Hotels was sold to The Lightstone Group in July 2007 and Prime Hospitality's Wellesley Inns were folded into La Quinta.

Its most notable transactions during this period included: In 2004, Blackstone had explored the possibility of creating a business development company (BDC), Blackridge Investments, similar to vehicles pursued by Apollo Management.

Other notable investments that Blackstone completed in 2008 and 2009 included AlliedBarton, Performance Food Group,[75][76] Apria Healthcare, and CMS Computers.

In July 2008, Blackstone, NBC Universal, and Bain Capital acquired The Weather Channel from Landmark Communications for $3.5 billion.

The transaction, valued at $450 million, involved the sale of Blackstone's stake to the global private equity firm Apax.

As part of the agreement, GIC secured a 35% stake in HIP, with the deal establishing a valuation exceeding €4 billion for the company.

[169] In December 2023, Blackstone announced its intention to divest its entire 23.59% stake, valued at $833 million, in Embassy Office Parks, India's largest real estate investment trust.

[11] Blackstone's most notable investments include Allied Waste,[35] AlliedBarton Security Services, Graham Packaging, Celanese, Nalco, HealthMarkets, Houghton Mifflin, American Axle, TRW Automotive, Catalent Pharma Solutions, Prime Hospitality, Legoland, Madame Tussauds,[176] Luxury Resorts (LXR), Pinnacle Foods, Hilton Hotels Corporation, Motel 6, Apria Healthcare, Travelport, The Weather Channel (United States) and The PortAventura Resort.

It denied blame, although Blackstone was widely accused in the media for selling on the company with an unsustainable business model and crippled with an impossible sale and leaseback strategy.

[181][182] After the 2007–2010 subprime mortgage crisis in the United States, Blackstone Group LP bought more than $5.5 billion worth of single-family homes to rent, and then be sold when the prices rise.

[188] In November 2024, Blackstone acquired a group of four retail buildings in Soho for approximately $200 million from ASB Real Estate Investments.

The properties, which house tenants such as Patagonia and Amiri, were purchased with the strategy of increasing revenue by bringing below-market leases up to current rates.

The GSO team had previously managed the leveraged finance businesses at Donaldson, Lufkin & Jenrette and later Credit Suisse First Boston, after it acquired DLJ.

[191][50] In separate cases in 2018 and 2019, the hotel chain Motel 6, owned by Blackstone, agreed to settle for a total of $19.6 million for giving guest lists to U.S. Immigration and Customs Enforcement (ICE) without a warrant.

[195] An investigation by the U.S. Department of Labor showed that more than 100 American children had been working illegally for Packers Sanitation Services Inc. (PSSI), a slaughterhouse cleaning firm owned by Blackstone.

The investigation began after a Walnut Middle School teacher in Grand Island, Nebraska, reported a student with hydrochloric acid burns on his hands and knees to the Department of Labor.