Home Alternative Investments Blue Owl Capital’s AUM up 17% for quarter, rises 91% for year

Blue Owl Capital’s AUM up 17% for quarter, rises 91% for year

11
0

Blue Owl expects to raise a total of $50 billion through 2023, said Douglas I. Ostrover, CEO during the earnings call. He said Blue Owl executives want to provide shareholders better growth than its peers but without carried interest income, which is volatile.

Blue Owl’s largest business with $56.8 billion in AUM as of June 30 is Owl Rock, which lends to middle- and upper-middle-market businesses. Dyal Capital reported $45.7 billion in AUM as of June 30.

Returns faltered in the second quarter. Blue Owl’s direct lending business, Owl Rock, produced a net internal rate of return of -1.7% for the three months ended June 30 but a 4.2% net IRR for the 12 months ended June 30. Blue Owl reported that Dyal Capital Partners III earned a net IRR of 23.4% and Dyal IV returned a net IRR of 71.1%. The firm did not report returns for the Dyal business.

Blue Owl’s real estate business produced a net IRR of 5.7% for the second quarter and 27% for the 12 months ended June 30.

During the earnings call, Marc Lipschultz, a Blue Owl co-president, said that while Blue Owl executives “care very deeply about the performance of our products” and that performance matters “very much” to its fund investors, but for its shareholders “performance and, in particular, unrealized mark-to-market is not really impactful.” The reason is that as demonstrated in the second quarter, returns did not impact its management fee income, which grew during the period at a time when the public markets were down, Mr. Lipschultz said.

Blue Owl reported $284 million in management fees under GAAP in the second quarter, up from $248 million in the first quarter and $142 million in the second quarter of 2021. The firm also reported fee-related earnings management fees, a non-GAAP measure of $291 million in the quarter, up from $180.4 million and up from $180 million in the year-earlier quarter.

“What we ultimately really care about is good credit quality and that we get paid back on our investments and everything in between is simply noise,” Mr. Lipschultz said.

Blue Owl suffered a GAAP net loss of $1.1 million in the second quarter, compared with a $11.8 million loss in the first quarter and a $362 million loss in the second quarter of 2021.

Source link

Previous articleSinema makes Dems drop plan to fix carried interest tax loophole
Next articleFood commodity prices dip sharply in July | 2022-08-05

LEAVE A REPLY

Please enter your comment!
Please enter your name here