Apollo, Ares Curb Redemptions From Private Credit Funds

Summary

• The video details recent moves by private credit fund managers (e.g., Apollo, Ares) to enforce contractual caps on investor redemptions.
• A standard contractual "gate" allows funds to limit quarterly redemptions to 5% of net asset value to prevent forced "fire sales" of underlying assets.
• Apollo and Ares are cited as adhering to this 5% cap, with Apollo's leadership stating they are "acting exactly as they were supposed to act."
• This is contrasted with Blackstone's approach, which exceeded its own cap (up to 7.9%) to meet higher redemption requests and faced some industry criticism for doing so.
• Another firm, Cliff Water, also honored around 7% of requests despite a 14% redemption request level.
• From an investor perspective, the caps create frustration for those expecting liquidity, especially when "everyone [is] crowding for the exits at once."
• Defenders of the "semi-liquid" private credit fund model argue the gates are working as designed, allowing liquidity to be doled out "in lumps" over time and protecting asset values.
• The 5% level is described as generally "holding steady" across the industry despite some exceptions.