Key facts
- Ares Management raised a record $36 billion in the second quarter.
- Assets under management grew 17% to $671.3 billion.
- Fee-related earnings increased 20% to $491.1 million.
- The firm deployed $35.9 billion in capital during the quarter.
- Uninvested capital reached a record $170 billion, up 13%.
Ares Management, a prominent player in private credit, announced a record $36 billion in fundraising for the second quarter, signaling continued institutional investor appetite for the asset class. The firm's results place it among the top fundraisers in alternative assets, benefiting from capital shifts towards larger, established managers.
Despite recent negative headlines surrounding private credit, institutional investors like pension funds have maintained broad-based demand, allocating capital with a long-term perspective. Ares has successfully broadened its investor base, more than tripling direct institutional investors since 2019, with a focus on institutional clients.
CEO Michael Arougheti attributed the strong performance to consistent fund results across strategies. The credit segment led inflows with $23.7 billion, while the real assets division raised $9.7 billion. A notable contribution came from Ares' flagship asset-based finance fund, which secured $8.5 billion.
Assets under management surged 17% to $671.3 billion, and fee-related earnings grew 20% year-over-year to $491.1 million, reflecting the stable income stream from management fees.
Deal activity for private credit firms remained somewhat subdued due to geopolitical uncertainty impacting sponsor-backed M&A. However, Ares expressed optimism, citing a record investment pipeline. The firm deployed $35.9 billion in the quarter across U.S. and European direct lending, real estate, and alternative credit strategies. A significant deal included leading over $1.7 billion in debt financing for KSL Capital Partners' acquisition of Invited Clubs.
Uninvested capital rose 13% to a record $170 billion, positioning Ares to capitalize on its largest-ever investment pipeline and support future earnings growth. Alternative credit posted a gross return of 4.1%, U.S. senior direct lending returned 2.5%, and infrastructure equity returned 9%. After-tax realized income per share was $1.29, up from $1.03 a year ago.