The AI boom has a debt problem, or at least the bond market thinks it might. Blackstone’s top AI executive, Jasvinder “Jas” Khaira, says the firm is not losing sleep over it.
A calm voice in a jittery bond market
Khaira leads Blackstone’s AI efforts through a unit known as BXN1. It pulls together a range of private equity strategies aimed at the wider AI ecosystem.
He founded the firm’s N1 platform in April 2026. He is no newcomer, though: Khaira has been at Blackstone since 2004.
Blackstone has numbers to back that stance. An internal AI risk review of BCRED, the firm’s private credit fund, found that under 5% of its investments face substantial AI-related headwinds.
The broader market is not quite as relaxed. Tensions around AI infrastructure debt escalated in October 2026, dragging down prices on bonds tied to the sector.
CoreWeave, the AI cloud provider, offers the clearest example. Its bonds fell below 80 cents on the dollar in October 2026, pushing yields close to 15%.
Blackstone has not been fully shielded either. Bonds connected to Blackstone projects traded below 88 cents during 2026, as data-center debt sold off more broadly.
How AI financing got so big, so fast
The scale of borrowing explains why the market is twitchy. AI-focused leveraged finance issuance hit $88 billion in 2026.
The prior figure was approximately $20 billion. That’s a more than fourfold jump in a short window.
Blackstone’s exposure includes owning data centers outright and providing private credit that anchors facilities such as those tied to CoreWeave.
Khaira is also slated to speak at TechCrunch Disrupt 2026. He is expected to discuss where AI infrastructure investing goes from here, with a focus on physical infrastructure and disciplined capital allocation.
What this means for investors and the AI buildout
Blackstone’s argument rests on a distinction that matters. Not all AI exposure carries the same risk. A data center leased to a creditworthy tenant is a different bet from a software startup whose product gets disrupted by a new model.
For investors in private credit vehicles like BCRED, the under 5% figure is the key number to watch. It is an internal estimate, and its credibility depends on how conservatively Blackstone defines “substantial” AI risk.
Yields near 15% on names like CoreWeave reflect real doubts about repayment. Watch whether discounted bonds tied to Blackstone projects recover toward par or keep sliding.
A firm of Blackstone’s size can afford to wait out a rough patch. Smaller lenders that piled into the $88 billion issuance wave may not have the same luxury.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.