(Bloomberg) - Individual investors who were previously locked out of alternative-asset classes like private equity are in the midst of a “revolution,” Ares Management Corp. Chief Executive Officer Michael Arougheti said.
“We now have credit product, we have real estate product and now private equity product that mass affluent and true retail investors can access with partial liquidity,” Arougheti said Thursday at the Bloomberg Wealth Summit in New York. “That is a little bit of a holy grail.”
Ares has doubled its headcount in the last 18 months to about 2,100 employees in 35 offices after a “transformational decade” for alternative markets, Arougheti said.
The Los Angeles-based company is one of the dominant players in private credit, which has long lured institutional investors since it offers higher yields than corporate debt or syndicated loans. The asset class is increasingly attracting retail cash as well, with rivals Blackstone Inc. and Carlyle Group Inc. among the firms offering vehicles that reduce the barrier to entry by requiring a lower minimum investment.
Ares in October formed Ares Wealth Management Solutions, led by Raj Dhanda, to attract more retail investors. The firm on Wednesday launched a closed-end fund, Ares Private Market Fund, with $250 million in initial capital that will invest in private equity and other private assets and be distributed through the wealth unit to financial advisers across the U.S.
Ares has about $315 billion in assets under management, with roughly $200 billion of that in private credit. Arougheti said at a Bloomberg conference in October that the firm expects the total figure to reach $500 billion over the next four years.
By Brian Chappatta
