PDI 50 shows unprecedented investor demand

Private debt fundraising over the last five years has scaled new heights as an elite group of fast-growing gatherers of capital emerges.

The PDI 50, which ranks the 50 private debt fund managers raising the most amount of capital over a five-year period, now accounts for $653 billion in capital raised. The PDI 50 may be viewed HERE.

This represents a dramatic increase on the $541 billion raised by the PDI 50 over the prior five years when the last measurement was taken in 2016. In 2014, the total was less than $400 billion.

“The private credit fund market has deepened considerably over recent times as investors seek income at a time of low interest rates and as banks have been less able to provide debt than in the past,” said Gregg Disdale, head of illiquid credit at Willis Towers Watson.

“Managers clearly recognise both this funding gap and the demand for income from investors, so it’s an obvious market to grow assets under management,” he added.

The top fundraiser for the second year running is Dallas-based Lone Star Funds, which has raised $37.8 billion over the last five years, with its fifth distressed real estate debt fund beating a $5 billion target to raise $5.9 billion after just five months.

In second place is London-headquartered M&G Investments, which has reached its highest-ever position having made the top ten in four of the last five years. The firm has raised $36.5 billion in the five-year period, most of it coming via co-investment and separate account commitments from large institutions for tailored real estate debt strategies.

The top five is rounded out by Apollo ($35.2 billion), Oaktree Capital Management ($33.2 billion) and Blackstone ($33.0 billion).

The ranking shows North American managers retaining their grip, accounting for 36 of the top 50 slots. However, 14 of the 50 largest managers are now based outside the US, compared with only 10 in 2015. Paris-based AXA Investment Managers makes the top ten, with $31.2 billion raised, with London-based managers ICG and Hayfin in 12th and 18th places respectively.

While the impact of Asia-Pacific managers remains relatively marginal, Hong Kong’s PAG claims 35th place in the ranking and Melbourne-headquartered Westbourne Capital is at number 39.