Blackstone sees redemptions slow at $45bn private credit fund

Blackstone has reported a slowdown in redemption requests from investors in its flagship private credit vehicle, although fundraising into the fund has weakened significantly amid concerns over potential losses in parts of the private lending market, according to a report by the Financial Times.

Jonathan Gray, president of Blackstone, said the pace of withdrawals from the Blackstone Private Credit Fund, known as BCRED, had slowed materially during the early part of the third quarter.

The fund was forced to restrict redemptions earlier this year after investor requests exceeded the 5% quarterly limit permitted under its terms. The move followed heightened concerns about potential losses on loans to highly leveraged technology and software companies.

Gray said the recent reduction in withdrawal requests was encouraging, although he cautioned that the trend was still at an early stage.

BCRED, which has approximately $45bn in net assets, raised about $1bn of new equity during the three months to the end of June. That represented a decline of roughly 70% from the same period a year earlier.

Gray said new investment into the fund remained muted as concerns over private credit weighed on the retail wealth channel. However, he said institutional investors continued to allocate substantial capital to other Blackstone private credit strategies.