Blackstone has hit the hard cap on its fifth opportunistic credit fund, raising over $10bn (£7.5bn), which it says underlines “continued strong institutional demand for private credit”.
Blackstone’s record raise for the institutional-focused Blackstone Capital Opportunities Fund V (COF V) comes as the private credit asset class has faced increasing scrutiny over credit quality and software exposure in the past six months, much of which has been focused at the US retail market.
“COF V is Blackstone’s largest opportunistic credit fund raised to date, reflecting continued strong institutional demand for private credit,” said Lou Salvatore, co-portfolio manager of the capital opportunities funds. “Amidst a noisy backdrop for the industry, we believe this fundraise demonstrates the strength of Blackstone’s capabilities in private credit, and we’re grateful for the support from both longstanding and new investors.”
Read more: Blackstone says today’s private credit is ‘nothing like 2008’
The world’s largest alternatives manager, with $1.27tn of assets under management, said the overall strategy has generated a 13 per cent net IRR since its inception in 2007.
The firm manages $520bn of assets across corporate and real estate credit, with Blackstone’s president and chief operating officer Jon Gray highlighting the record fundraising from institutional investors in its credit division during its fourth-quarter earnings call.
Blackstone, which raises the vast majority of its capital from institutional investors, has been keen to highlight robust demand from that funding channel given the current concerns around the US wealth market.
“COF V benefits from our robust sourcing engine and broad, flexible mandate, allowing us to invest across a wide range of industries, geographies, and capital structures,” said Rob Petrini, co-portfolio manager of the capital opportunities funds. “We believe that this is a very attractive environment to deploy flexible capital in private corporate credit as well as to provide opportunistic and structured solutions to companies in sectors with strong thematic tailwinds.”
Blackstone’s fundraise comes as opportunistic credit funds gain popularity among private asset managers. Last week, Ares also raised over $9.8bn for its opportunistic credit strategy, following the final close of its third fund in the space.
In addition, European special situations opportunities have doubled since the Covid pandemic, according to Benefit Street Partners, with 2026 likely to see an equal or greater wave of stressed assets.
