UPDATES (cont.) THRIVING PRIVATE CAPITAL MARKETS

The global private credit market is now one of the fastest-growing asset classes. According to Preqin, this $1.5 trillion industry will hit $2.3 trillion by 2027, with other reports estimating $2.5 trillion by 2025, as established players launch further funds and new players come onto the scene.

Data from the Global Private Capital Association’s members saw private credit and infrastructure investments hit record levels in 2022.

Rising interest rates have been hugely beneficial, as has the retreat by international banks from such offerings. The US is still the largest and most mature private credit market, covering direct lending, mezzanine lending, distressed and special sits, speciality finance, real asset credit and real estate credit.

Just in the past few weeks, we have seen private credit firms provide $5.5 billion of funding for Carlyle’s Cotiviti deal, the largest private buyout financing to date. Since we last wrote, two funds have closed combined commitments of more than $10 billion for flagship offerings - LA-based Crescent Capital Group, with $8 billion for Credit Solutions VIII, and New York based Willow Tree Credit Partners, $2.4 billion to finance senior secured floating rate loans. Elsewhere, behemoths, such as Blackstone and KKR, are raising more regionally focused multi-billion-dollar funds, while the likes of Janus Henderson are adding private credit to their future growth strategy. Family offices are also on the case, with news that Cercano Management is building out its direct lending arm. The family office, which looks after $10 billion of assets for the likes of Paul Allen’s family (from which it spun out of), views this as the “biggest growth area” this year, writes Bloomberg