From India to Japan to Taiwan, Micron builds new HBM base in Asia

# Yang Chen

Source: WallStreetCN

In the first quarter, major private credit funds including Blackstone and BlackRock received more than **$100 billion** in redemption requests, but only approved about **70%** for payout, with the rest deferred. Management fees and performance fees represent key revenue sources for large private equity firms. Most listed peers have fallen more than 25% this year, as investors worry about the sustainability of fee‑based growth.

Private credit funds targeting wealthy individuals are facing a wave of concentrated redemptions. Managers have activated withdrawal restrictions, honoring only about 70% of requests. One of Wall Street’s most important growth engines is now under pressure to “slow down,” with valuations of related listed private capital firms being reset accordingly.

According to the Financial Times, in the first quarter of this year, some of the largest private credit funds received total redemption requests exceeding **$100 billion**, involving firms including Blackstone, BlackRock, Cliffwater, Morgan Stanley, and Monroe Capital.

The debt funds managed by these institutions approved roughly **70%** of the **$101 billion** in requests for payout, with the remainder deferred. The total redemption volume is expected to rise further as Ares Management, Apollo Global, Blue Owl, Oaktree, Goldman Sachs, and others finalize their figures over the next two weeks.

The rapid withdrawal has quickly spilled over to public markets. Shares of related private capital firms have generally tumbled **25% or more** this year, erasing more than **$100 billion** in combined market value. Investors are re‑evaluating the fee‑based growth and valuation premiums supported by retail‑focused private credit products.

## Q1 redemptions top $100 billion, payouts forced to 70%

Financial Times calculations show that debt funds managed by Blackstone, BlackRock, Cliffwater, Morgan Stanley, and Monroe Capital faced a combined **$101 billion** in redemption requests in Q1, with about **70%** approved for payout.

Redemption pressure continues to spread. Over the next two weeks, Ares Management, Apollo Global, Blue Owl, Oaktree, Goldman Sachs, and others will report their redemption figures, with the total expected to climb higher.

The funds that have disclosed redemptions manage a combined investment portfolio of about **$166 billion**, representing only a small portion of the roughly **$1.5 trillion** direct lending market. However, these products are among the fastest‑growing segments in private investing, making their liquidity swings particularly impactful to managers’ “growth stories.”

## From inflows to outflows: Wall Street’s growth engine hits headwinds

The redemption wave has reversed years of steady capital inflows. Over the past five years, large private debt funds drew nearly **$2 trillion** in net flows, fueling industry expansion and profitability. When redemptions trigger withdrawal gates, investor confidence in sustainable growth cools sharply.

The imposition of redemption limits itself has become a catalyst for risk repricing. With multiple funds honoring only about 70% of requests, investors face the reality that they cannot always access full capital when needed, eroding the appeal of semi‑liquid private credit vehicles.

Goldman Sachs analysts estimate that retail private credit fund assets swelled from **$34 billion** at the end of 2021 to **$222 billion** by late last year, but growth has now reversed. Following the redemption wave that highlighted illiquidity risks, the bank projects these funds could lose **$45–70 billion** in assets over the next two years.

## Fee‑based income in focus, driving valuations

For listed managers, retail‑focused private credit funds represent not just assets under management, but predictable streams of management and performance fees.

Blackstone’s **$48 billion** Bcred debt fund has become its single largest source of fee revenue, accounting for roughly **13%** of total fees at the **$1.3 trillion**‑asset manager.

Bcred pays Blackstone a **1.25%** annual management fee and **12.5%** performance fee above a **5%** hurdle rate, generating about **$1.2 billion** in annual fees last year.

At Blue Owl, its **$35 billion** private fund OCIC is similarly critical to growth, delivering roughly **$447 million** in management and incentive fees last year.

Goldman Sachs estimates Blue Owl has the highest industry reliance on these retail‑focused funds, with about **21%** of annual fee‑related income tied to such products.

At an industry level, private capital groups have in recent years emphasized more predictable fee‑based earnings to boost appeal for equity investors, at one point supporting valuations of **30–40x** fee earnings. The trade‑off: if retail capital flees en masse during market stress, fee‑growth expectations can reset rapidly.

## Share price slump: markets reprice “growth certainty”

The primary market impact of the redemption wave has been a broad selloff in private capital stocks. Blackstone, KKR, Blue Owl, Ares, Apollo, and others have all fallen **25% or more** this year, with combined market value down over **$100 billion**.

The CEO of Vulcan Value Partners told the Financial Times that the entire sector is under heavy pressure. He noted that the selloff has not adequately differentiated business models: firms relying on more stable sources such as pensions and endowments have also been sold off indiscriminately.

The report stressed that firms including Blackstone and Blue Owl do not hold loans on their balance sheets, so direct credit losses are not the core concern. Instead, the selloff reflects a repricing of future growth, retail funding stability, and the sustainability of fee income.

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