August 5, 2024
KKR: Fundraising from Wealth Channel Accelerates
Overall, KKR posted adjusted net income of $971.9 million during the quarter, or $1.09 per share, a 49% increase from a year ago.

David Bodamer | WealthManagement.com

Alternative asset manager KKR & Co. reported growing momentum in its investment funds aimed at retail investors and advisor clients during its second-quarter earnings. The firm also signaled that the first products developed through its partnership with Capital Group will debut in 2025.

Among its existing investments in the wealth channel—what the asset manager calls its K-Series—KKR operates a series of semi-liquid funds focused on private credit, private equity, private real estate and infrastructure, and open to accredited investors and qualified purchasers. KKR said the K-Series, in aggregate, now has $11 billion in assets—up from $3 billion a year ago. Flows into the products have accelerated from $500 million per month at the end of 2023 to $900 million per month in the most recent quarter.

“We think the interesting part here is the long-term secular opportunity,” said Craig Larson, KKR’s head of investor relations, during the company’s earnings call. The mass affluent market has not had an easy way to access alts. We expect trillions of assets to flow to these products, and we feel like we are well-positioned.”

In May, KKR and Capital Group announced a joint venture to develop a series of products that combine private and publicly traded investments, open to mass affluent investors and slated to touch on credit, equity, real estate and infrastructure markets.

During the second quarter call, KKR executives said they expected the first funds from that partnership—two hybrid credit-based funds with a mix of public bonds, direct lending and private asset-based loans—would debut in 2025. Capital Group will manage the public components, while KKR will handle the private strategies. Overall, the funds will feature 60% in public bonds and 40% in private credit. 

For the other asset types, KKR execs said the partnership is still in the design phases and there is no timeline on when the products will launch.

KKR’s pace of retail fundraising parallels comments from fellow alternative asset behemoth Blackstone during their earnings call earlier this month . In addition, Robert A. Stanger & Co. recently raised its forecast for alternative investment fundraising by retail investors to $115 billion in 2024 after a solid first half of the year. 

Overall, KKR posted adjusted net income of $971.9 million during the quarter, or $1.09 per share, a 49% increase from a year ago. That beat estimates of analysts surveyed by Bloomberg, who had expected earnings of $1.06 per share.

Total investing earnings, which includes performance income and gains on asset sales, surged 57% from a year earlier to $240.6 million. Assets under management totaled $601 billion at the end of June, a 16% increase from a year earlier. KKR raised $32 billion of new capital, including $18 billion for real assets and $12 billion for credit. It raised $2 billion for private equity.

Additional reporting by Bloomberg contributed to this story.

Recent

ExchangeRight Details 721 Structure of Dow Campus Acquisition

ExchangeRight Details 721 Structure of Dow Campus Acquisition

ExchangeRight’s Essential Income REIT acquired the Dow Texas Innovation Center through a 721 exchange with Brixton Capital. The transaction highlights how property contributions, financing, and operating partnership units shape acquisition economics.
Ares Capital Agrees to Acquire MidCap Financial Investment

Ares Capital Agrees to Acquire MidCap Financial Investment

Ares Capital agreed to acquire MidCap Financial Investment in a transaction with approximately $2.6 billion in enterprise value. Closing is expected in the first half of 2027, subject to approvals and other conditions.

Most Popular

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update 10-3-2023 Blue Vault wishes to acknowledge and apologize for the delay in publishing some Q2 2023 NTR Individual Performance Pages (IPPs) as well as the full review. We recently added additional reporting metrics to our IPPs, and that, combined with coverage of all share classes and some additional…
Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update

Blue Vault Q2 2023 Performance Reports Update 9-25-2023 Blue Vault has published the Q2 2023 Nontraded BDC Industry Review as well as Individual Performance Report and Limited Operations pages for the following offerings (newly published pages in bold font): Nontraded REITS American Healthcare REIT Q2 2023 Apollo Realty Income Solutions Q2 2023 (limited operations) Ares…

Explore

Blue Vault Logo
Don’t miss alts news
and educational events

Sign Up For Emails