At a glance
- Hard-asset funds out-raised credit funds by $5.3 billion in the third quarter.
- Private credit assets still climbed 17% to $4.1 trillion, the Alternative Credit Council reported Oct.
- For advisors, the split has an exam angle: the SEC's 2027 exam priorities list illiquid products, and examiners will review disclosures and whether a recommendation matched client objectives.
Credit fundraising fell 48% through September while hard-asset fundraising rose 39%, as total alternative fundraising declined 14% to $134.4 billion, according to Stanger. Hard-asset funds out-raised credit funds by $5.3 billion in the third quarter.
Private credit assets still climbed 17% to $4.1 trillion, the Alternative Credit Council reported Oct. 22. The ACC also found that one-sixth of surveyed funds carry non-accrual rates above 5%; that is a share of funds, not of assets.
For advisors, the split has an exam angle: the SEC's 2027 exam priorities list illiquid products, and examiners will review disclosures and whether a recommendation matched client objectives. A fund's non-accrual figure sits inside the suitability file.
Credit fundraising fell 48% while hard assets rose 39%
Change in alternative fundraising through September
- Inflow / above zero
- Outflow / below zero
Show as table
| Label | Value (%) |
|---|---|
| Credit | −48% |
| Hard assets | 39% |
| All alternatives | −14% |
Private credit assets grew while new commitments rotated
Listed credit has been marking the same question. BDC common stocks fell again in the week to Oct. 23, with declines almost across the board, according to BDC Reporter's Oct. 24 recap, which said earnings season is close.
| Metric | Figure | Source |
|---|---|---|
| Alternative fundraising, through September | $134.4 billion, down 14% | Stanger |
| Credit fundraising | down 48% | Stanger |
| Hard-asset fundraising | up 39% | Stanger |
| Hard assets vs credit, third quarter | hard assets ahead by $5.3 billion | Stanger |
| Private credit assets | $4.1 trillion, up 17% | Alternative Credit Council, Oct. 22 |
| Surveyed funds with non-accruals above 5% | one-sixth | Alternative Credit Council |
| US life insurers' AI holdings | $85.2 billion, up 24%; 1.4% of cash and invested assets | Moody's |
| Family offices expecting a larger alternatives share (with prospective next-gen principal) | 79% of 355 decision makers | Bank of America |
| Family offices using credit / using leverage consistently | 92% / 27% | Bank of America |
| Northwind NDF III final close | $1 billion against a $500 million target | Connect CRE |
Where the money went: $1 billion against a $500 million target
Northwind Group closed a $1 billion real estate debt fund at twice its $500 million target, Connect CRE reported. Northwind says NDF III is the largest fund in its history.
US life insurers' alternative investment holdings reached $85.2 billion, up 24% and equal to 1.4% of cash and invested assets, according to Moody's. Moody's notes that guarantees and leases add exposure outside that reported figure.
In Bank of America's study of 355 US family office decision makers, 79% of those with a prospective next-generation principal expect alternatives to take a larger share of the portfolio, and 92% use credit while 27% use leverage consistently.
The next hard number arrives with BDC earnings season, which BDC Reporter described as close. Those reports carry non-accruals fund by fund, where the ACC survey reports a share of surveyed funds.
Reported by PWD Editors from Stanger, Alternative Credit Council, Oct. 22 report, Moody's, Bank of America family office study, BDC Reporter, Oct. 24 recap, Connect CRE, Trepp and SEC 2027 exam priorities. Published . Corrections