Ares Management Corp
For the period ended Mar 31, 2026. Filed May 8, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 8, 2026
ARES$133.98+0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001628280-25-049899
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001628280-26-032990
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 341 previous paragraphs and 297 current paragraphs.
171 unchanged; 71 reworded; 52 added; 96 removed; 3 previous and 3 current paragraphs rearranged.
Tables are not compared: 94 previous and 85 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (52)
Current report
During the first quarter of 2026, global markets experienced heightened volatility amid the geopolitical tension and conflicts in the Middle East, elevated energy prices and changes in monetary policy expectations. As a result, U.S. and European high yield bonds and leveraged loans were pressured, with European markets more sensitive to the conflicts in the Middle East due to greater dependency on oil flows. U.S. and international equity markets also declined amid inflationary pressures and broader macroeconomic uncertainty. Developed and emerging international markets modestly outperformed U.S. equities, reflecting stronger performance in select regions.
Current report
Private equity activity moderated during the quarter, with dealmaking and exit activity softening amid continued market selectivity and elevated uncertainty in private credit markets. Sponsors remained highly selective, prioritizing businesses with resilient fundamentals and clear paths to value creation, including differentiated technology and artificial intelligence capabilities. We believe a renewed focus on value creation strategies that emphasize operational improvements, selective deployment, talent optimization and digital transformation are essential to support long-term momentum.
Current report
(1) Includes $5.4 billion and $5.2 billion of non-fee paying AUM from our general partner and employee commitments as of March 31, 2026 and 2025, respectively.
Current report
We consolidate (i) entities that we have both the power to direct significant activities of the entity and a significant economic interest; and (ii) entities in which we hold a majority voting interest or have majority ownership and control over the operational, financial and investing decisions of that entity. Certain funds that have historically been consolidated in the financial statements may no longer be consolidated because: (i) such funds have been liquidated or dissolved; or (ii) we are no longer deemed to have a controlling interest in the entity. Consolidated Funds represented approximately 6% of our AUM as of March 31, 2026 and 5% of total revenues for the three months ended March 31, 2026.
Current report
Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025
Current report
Principal Investment Income. The activity for the three months ended March 31, 2026 was primarily attributable to:
Current report
•Dividend income of $7.2 million primarily generated from our investments in various U.S. direct lending, Japanese real estate equity and real estate debt funds
Current report
•Unrealized losses of $10.5 million from our investment in a U.S. real estate equity fund, partially offset by unrealized gains of $3.1 million from our investments in various European real estate equity funds and opportunistic credit funds
Current report
•Dividend income of $4.7 million generated from our investments in various real estate debt funds
Current report
•Net realized gains of $3.5 million generated from our investments in various U.S. real estate equity funds
Current report
Administrative, Transaction and Other Fees. The increase for the three months ended March 31, 2026 compared to the same period in 2025 was driven by: (i) an increase of $21.0 million reflecting the full quarter impact of property-related fees and administrative service fees earned from funds acquired in the GCP Acquisition; (ii) an increase in administrative service fees of $6.5 million, earned from new and existing private funds within our Credit Group that are based on invested capital and from our perpetual wealth funds; and (iii) an increase in capital markets transaction fees of $5.2 million, reflecting increased transaction volumes.
Current report
Compensation and Benefits. The following table presents the components of change in compensation and benefits for the three months ended March 31, 2026 compared to the same period in 2025 ($ in millions):
Current report
The increase in cash-based compensation and benefits reflected the continued growth in salary and benefits for our increased staffing levels, as well as the full quarter impact of employment related costs of $30.8 million from the GCP Acquisition.
Current report
In addition, Part I Fee compensation increased over the comparative period, corresponding to the increase in Part I Fees. We reduced Part I Fee compensation by $7.5 million and $4.8 million for the three months ended March 31, 2026 and 2025, respectively, to reclaim a portion of the supplemental distribution fees that we paid to distribution partners.
Current report
Equity compensation increased over the comparative period as a result of newly issued discretionary and bonus-related awards granted at higher stock prices relative to previously granted awards that have since fully vested. Acquisition-related equity compensation expense decreased over the comparative period as the prior year period included $108.8 million of expense from the portion of the awards associated with the purchase price of the GCP Acquisition that immediately vested.
Current report
Full-time equivalent headcount increased by 24% to 4,297 professionals for the year-to-date period in 2026 from 3,474 professionals in 2025, including the impact from the GCP Acquisition of 511 full-time equivalents.
Current report
General, Administrative and Other Expenses. The increase ingeneral, administrative and other expenses reflect growing staffing levels and fundraising activities, as well as the full quarter impact of operating costs of $13.2 million from the GCP Acquisition. Excluding the impact from the GCP Acquisition, information technology costs for software licenses and capitalized software amortization increased by $5.7 million for the three months ended March 31, 2026 compared to the same period in 2025, driven by continued build-out of internally developed software and to support our growing headcount. Travel and marketing costs also increased by $4.4 million over the comparative period, driven by new sponsorships and investor events held during the quarter. Furthermore, supplemental distribution fees increased by $4.2 million over the comparative period due to the expansion of our distribution relationships and wealth product offerings.
Current report
Amortization of intangible assets increased by $9.8 million over the comparative period, primarily due to the full quarter impact from the GCP Acquisition.
Current report
Conversely, acquisition-related costs decreased by $33.4 million for the three months ended March 31, 2026 compared to the same period in 2025. Acquisition-related costs generally precede a business combination, vary with the complexity of the transaction and may occur even when acquisitions are not successfully completed. We incurred costs in the current quarter primarily related to the acquisition of the remaining outstanding shares of BlueCove Limited (the “BlueCove Acquisition”), while we incurred $33.7 million during thethree months ended March 31, 2025 related to the GCP Acquisition.
Current report
•Unrealized gains of $42.7 million from our strategic investments in X‑Energy, Inc., which completed its initial public offering after the first quarter of 2026 (Nasdaq: XE), partially offset by unrealized losses of $36.4 million primarily from our investments in KDK and J-REIT
Current report
Interest Expense. Interest expense increased for the three months ended March 31, 2026 compared to the same period in 2025 due to a higher average outstanding balance of our Credit Facility. At the end of March 2026, we borrowed $400.0 million under the Term Loan. We expect interest expense attributable to the Term Loan to be approximately $4.7 million per quarter in future periods.
Current report
Other Income (Expense), Net. Other income (expense), net for the three months ended March 31, 2026 included a $37.4 million bargain purchase gain from the BlueCove Acquisition. A bargain purchase gain resulted from the fair value of the identifiable tangible and intangible assets acquired exceeding the purchase consideration. A portion of the purchase price payable to certain senior professionals is dependent upon the achievement of revenue targets and has been excluded from purchase consideration as it is subject to continued and future service.
Current report
Other income (expense), net for the three months ended March 31, 2026 also included non-cash expense of $14.3 million from an increase in fair value of contingent consideration, reflecting our progress toward achieving the earnouts established in connection with the GCP Acquisition. These earnouts are based on revenue targets of certain digital infrastructure funds and fundraising targets of certain Japanese real estate funds. See “Note 7. Commitments and Contingencies” within our unaudited condensed consolidated financial statements for a further description of these contingent earnout arrangements.
Current report
The majority of our Consolidated Funds are not subject to income tax as the funds’ investors are responsible for reporting their share of income or loss on a pass-through basis. Accordingly, the following discussion focuses on the change in income tax expense attributable to the Company:
Current report
Credit Group—Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025
Current report
The decrease in effective management fee rate for the three months ended March 31, 2026 compared to the same period in 2025 was primarily attributable to increases in FPAUM from our funds in the liquid credit strategy, which have an effective fee rate of less than 0.50%.
Current report
Compensation and Benefits. The increase in compensation and benefits for the three months ended March 31, 2026 compared to the same period in 2025 was primarily driven by an increase in: (i) Part I Fee compensation of $14.9 million, corresponding to the increase in Part I Fees; (ii) incentive-based compensation of $6.3 million; and (iii) salary expenses of $2.9 million, primarily attributable to headcount growth; partially offset by (iv) lower fee related performance compensation of $9.8 million, corresponding to the decrease in fee related performance revenues. We reduced Part I Fee compensation by $3.9 million and $4.8 million for the three months ended March 31, 2026 and 2025, respectively, to reclaim a portion of the supplemental distribution fees that we paid to distribution partners.
Current report
General, Administrative and Other Expenses. The increase in general, administrative and other expenses for the three months ended March 31, 2026 compared to the same period in 2025 was driven by: (i) an increase in professional service fees of $4.4 million; (ii) an increase insupplemental distribution fees of $2.6 millionas we continue to expand our wealth product offerings and distribution relationships; and (iii) an increase in information technology costs of $1.1 million to support our growing headcount.
Current report
Interest expense allocated to the Credit Group decreased for the three months ended March 31, 2026 compared to the same period in 2025 as a significant portion of the current period’s interest expense was allocated based on capital used to finance the GCP Acquisition in the prior year, which occurred within the Real Assets Group.
Current report
(1) Includes $2.3 billion and $2.0 billion of non-fee paying AUM from our general partner and employee commitments as of March 31, 2026 and 2025, respectively.
Current report
Real Assets Group—Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025
Current report
The following table presents the components of and causes for changes in the Real Assets Group’s management fees for the three months ended March 31, 2026 compared to the prior year ($ in millions):
Current report
Other Fees. The increase in other fees for the three months ended March 31, 2026 compared to the same period in 2025 was driven by: (i) an increase of $18.9 million reflecting the full quarter impact of property-related fees and administrative service fees earned from funds acquired in the GCP Acquisition; and (ii) an increase in property management fees of $4.6 million from our U.S. open-ended industrial real estate equity fund and our non-traded REITs, driven by the internalization of certain property management services. We expect property management fees to increase in future periods as we expand property management services across more properties and retain the fees for services that were previously outsourced to third-parties.
Current report
Compensation and Benefits. The increase in compensation and benefits over the comparative period was driven by: (i) an increase of $19.9 million from the full quarter impact of employment related costs from the GCP Acquisition; and (ii) an increase in fee related performance compensation of $1.4 million, corresponding to the increase in fee related performance revenues. There was no Part I Fee compensation for the three months ended March 31, 2026 as we reduced Part I Fee compensation by $3.6 million to reclaim a portion of the supplemental distribution fees paid to distribution partners.
Current report
Full-time equivalent headcount increased by 66% to 1,019 investment and investment support professionals for the year-to-date period in 2026 from 615 professionals for the same period in 2025, including the impact from the GCP Acquisition of 351 full-time equivalents.
Current report
General, Administrative and Other Expenses. The increase in general, administrative and other expenses for the three months ended March 31, 2026 compared to the same period in 2025 was driven by: (i) an increase of $9.4 million from the full quarter impact of operating costs from the GCP Acquisition; and (ii) an increase in supplemental distribution fees of $4.0 million due to the expansion of our distribution relationships for our open-ended core infrastructure fund.
Current report
(1) Includes $1.5 billion of non-fee paying AUM from our general partner and employee commitments as of March 31, 2026 and 2025.
Current report
The significant funds presented in the tables below collectively contributed approximately 28% of the Real Assets Group’s management fees for the three months ended March 31, 2026.
Current report
The following table presents the performance data for our significant perpetual capital funds in the Real Assets Group as of March 31, 2026 ($ in millions):
Current report
Secondaries Group—Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025
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Removed paragraphs (96)
Previous report
During the third quarter of 2025, macroeconomic and geopolitical developments continued to shape sentiment across global equity and debt markets. Markets largely remained resilient and performed well despite continued volatility. The U.S. public equity markets were supported by interest rate cuts that signaled the possibility of further easing. International markets continued to outperform, supported by gradually improving transaction volumes.
Previous report
Private equity activity rebounded in the third quarter, marking a shift in market sentiment following a subdued first half of the year. Transaction and exit activity accelerated, fueled by easing interest rates and a narrowing valuation gap between buyers and sellers. We believe that stabilized market conditions, with a renewed focus on value creation strategies that emphasize operational improvements, selective deployment, talent optimization and digital transformation are essential to support long-term momentum.
Previous report
(1) Includes $14.0 billion and $14.4 billion of AUM of funds from which we indirectly earn management fees as of September 30, 2025 and 2024, respectively, and includes $5.7 billion and $4.2 billion of non-fee paying AUM from our general partner and employee commitments as of September 30, 2025 and 2024, respectively.
Previous report
(1)Other consists of Ares Commercial Real Estate Corporation’s (NYSE: ACRE) (“ACRE”) FPAUM, which is based on ACRE’s stockholders’ equity.
Previous report
Components of Consolidated Results of Operations
Previous report
GCP Acquisition Overview
Previous report
On March 1, 2025, we completed the acquisition of the international business of GLP Capital Partners Limited and certain of its affiliates, excluding its operations in Greater China (“GCP International”), and existing capital commitments to certain managed funds (such acquisition of GCP International and the capital commitments, the “GCP Acquisition”). The GCP Acquisition adds complementary real estate and digital infrastructure investment capabilities and expands the Company’s geographic presence. The activities of GCP International are included within the Real Assets Group segment.
Previous report
The GCP Acquisition adds geographic exposure in Asia with a significant logistics platform in Japan, logistics platforms in emerging economies such as Brazil and Vietnam and an expanded presence in Europe and the U.S. The GCP Acquisition has broadened our vertically integrated operating and development capabilities across sectors and regions. We anticipate that the size and composition of fees earned, particularly our other fees, will be impacted by these expanded capabilities.
Previous report
The activities of GCP International are reflected within our results of operations beginning on March 1, 2025. Therefore, our analysis compared to the prior year periods will lack comparability, particularly in our Real Assets Group segment. Because the activities of GCP International represent seven months of activity within the nine months ended September 30, 2025, we will separately discuss the significant impact of the GCP Acquisition within our discussion of our results of operations.
Previous report
In addition, various components of the agreed upon purchase price for the GCP Acquisition are required to be accounted for as compensation because the payments were made to certain individuals that became Ares employees on March 1, 2025. Because they are required to be accounted for as compensation, these amounts have been excluded from purchase consideration and will have a varying impact on our results of operations in the current periods as well as in future periods. Following an integration period, we expect to generate cost savings as we begin to execute on synergy opportunities.
Previous report
In connection with the GCP Acquisition, we also entered into contingent compensation arrangements with the sellers and with certain of its professionals that became Ares employees. The portion of the arrangements that are attributable to the sellers represents a component of purchase consideration that will be accounted for as contingent consideration. The portion of the arrangements that are attributable to the professionals that became Ares employees requires continued service through the measurement periods and will be accounted for as compensation. These arrangements will have a varying impact on our results of operations in the current periods as well as in future periods that is dependent on these classifications as well as the expected attainment of the measurement criteria.
Previous report
The following is an overview of our fee arrangements by strategy that were impacted as a result of the GCP Acquisition.
Previous report
Management Fees. Details regarding management fees from GLP J-REIT (TSE: 3281) (“J-REIT”) are presented below:
Previous report
Details regarding management fees by strategy, excluding J-REIT described above, are presented below:
Previous report
(1) Represents the average remaining contract term pursuant to the funds’ governing documents within each strategy, excluding perpetual capital vehicles, as of September 30, 2025.
Previous report
(2) Following the expiration or termination of the investment period the basis on which management fees are earned for certain closed-end funds in this strategy changes from committed capital to invested capital with no change in the management fee rate. In addition, certain real estate funds pay a management fee of 7.50% of net operating income. For these funds, we present an effective fee rate as a percentage of GAV.
Previous report
Incentive Fees. Details regarding fee related performance revenues, excluding publicly-traded and perpetual wealth vehicles, are presented below:
Previous report
Carried Interest Allocation. Details regarding carried interest, which is generally based on a fund’s eligible profits, are presented below:
Previous report
Administrative, Transaction and Other Fees. Details regarding other fees are presented below:
Previous report
See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Components of Consolidated Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024 for a comprehensive overview of the components of our consolidated results of operations, including an overview of fee arrangements for other strategies that were not impacted as a result of the GCP Acquisition.
Previous report
Consolidated Funds represented approximately 3% of our AUM as of September 30, 2025 and 5% of total revenues for the nine months ended September 30, 2025. As of September 30, 2025, we consolidated 23 CLOs and 16 private funds, and as of September 30, 2024, we consolidated 28 CLOs, 10 private funds and one SPAC.
Previous report
We generally deconsolidate funds and CLOs when we are no longer deemed to have a controlling interest in the entity. During the nine months ended September 30, 2025, we deconsolidated four CLOs as a result of liquidation, one CLO as a result of a significant change in ownership and Ares Acquisition Corporation II (“AAC II”), as we no longer hold a controlling financial interest in Kodiak AI, Inc. (Nasdaq: KDK) (f/k/a AAC II) following the business combination described in “Note 13. Equity and Redeemable Interest.” During the nine months ended September 30, 2024, we did not deconsolidate any entity.
Previous report
Three and Nine Months Ended September 30, 2025 Compared to Three and Nine Months Ended September 30, 2024
Previous report
Revenues
Previous report
Principal Investment Income. For equity method investments where we serve as general partner, we present the activity of net realized and unrealized gains on investments and interest and dividend income together with net cash received or used. The following tables present the change in fair value of our equity method investments where we serve as general partner ($ in millions):
Previous report
•Net realized and unrealized gains primarily included unrealized gains from our investments in various credit secondaries, private equity secondaries and infrastructure opportunities funds, partially offset by an unrealized loss from a U.S. real estate equity fund. The nine months ended September 30, 2025 also included unrealized gains from our investments in various U.S. direct lending funds.
Previous report
•Other adjustments reflect the impact of contributions of certain capital interests to structured investment vehicles that are consolidated by us. These adjustments reflect the reclassification of the contributed capital interests to Consolidated Funds, and as a result, these contributed capital interests are eliminated upon consolidation.
Previous report
•Net cash used was primarily driven by investments in various infrastructure opportunities funds. Net cash used for the nine months ended September 30, 2025 was also driven by investments in various real estate funds.
Previous report
The activity for the three and nine months ended September 30, 2024 was primarily attributable to:
Previous report
•Net cash received was primarily driven by transfers of our investments in alternative credit funds to employee co-investment vehicles, partially offset by investments in European real estate debt and U.S. direct lending funds. Net cash received for the nine months ended September 30, 2024 also included transfers of our investments in APAC credit funds to employee co-investment vehicles, partially offset by investments in European direct lending and infrastructure debt funds.
Previous report
Administrative, Transaction and Other Fees. The increases for the three and nine months ended September 30, 2025 compared to the same periods in 2024 were driven by incremental fees of $50.0 million and $107.9 million, respectively, following the completion of the GCP Acquisition. The GCP Acquisition enhances our vertically integrated capabilities, which enables us to earn various forms of property-related fees. For the three and nine months ended September 30, 2025, these incremental fees largely represented leasing, development and property management fees.
Previous report
The increases in fees over the comparative periods, excluding the aforementioned impact from the GCP Acquisition, were also driven by higher administrative service fees of $4.8 million and $14.2 million, respectively, primarily from: (i) our perpetual wealth vehicles, including two new products launched during the second half of 2024; and (ii) private funds within our Credit Group that are based on invested capital.
Previous report
Compensation and Benefits. In connection with the GCP Acquisition, various components of the agreed upon purchase price are required to be accounted for as compensation because the payments were made to certain individuals that became Ares employees following the GCP Acquisition. The three and nine months ended September 30, 2025 included the following acquisition-related compensation expenses: (i) equity-based compensation expense of $35.1 million and $195.0 million, respectively, from awards associated with the purchase price of the GCP Acquisition, with $108.8 million of expense from the portion of these awards that immediately vested in the first quarter of 2025; (ii) other compensation costs of $17.6 million and $47.2 million, respectively, that were settled in cash; and (iii) compensation expense of $16.7 million and $37.3 million, respectively, for certain contingent compensation arrangements established in connection with the GCP Acquisition. See “Note 8. Commitments and Contingencies” within our unaudited condensed consolidated financial statements for a further description of the contingent liabilities related to the GCP Acquisition arrangements.
Previous report
In addition, the GCP Acquisition contributed incremental employment related costs of $58.2 million and $121.3 million for the three and nine months ended September 30, 2025, respectively, largely reflecting salary expense and incentive-based compensation.
Previous report
Compensation and benefits, excluding the aforementioned impact from the GCP Acquisition, increased by $96.4 million and $291.2 million, or 22% and 23%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increases in expenses reflect the continued growth in salary and benefits for our increased staffing levels. The most significant expense increases were equity-based compensation, salary expense and incentive-based compensation. Equity-based compensation expense increased by $39.4 million and $121.8 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024 as a result of newly issued awards, magnified by our increased stock price. The higher stock price associated with equity awards that vested during the first quarter of 2025 also drove the increase in payroll-related taxes of $23.2 million from the prior year-to-date period. In addition, we accelerated expense for certain awards requiring no future service as retirement provisions have been achieved. These provisions increased expense by $25.0 million and $17.4 million for the nine months ended September 30, 2025 and 2024, respectively.
Previous report
Salary expense increased by $15.1 million and $43.5 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024 primarily due to headcount growth to support the expansion of our business. In addition, incentive-based compensation which is dependent on our operating performance and is expected to fluctuate during the year, increased over the comparative periods.
Previous report
Full-time equivalent headcount increased by 33% to 3,891 professionals for the year-to-date period in 2025 from 2,918 professionals in 2024. The acquisition of GCP International added 818 professionals to our period end headcount as of September 30, 2025, which represents 651 full-time equivalents for the year-to-date period.
Previous report
General, Administrative and Other Expenses. General, administrative and other expenses incurred in connection with the activities resulting from the GCP Acquisition were $53.3 million and $123.6 million for the three and nine months ended September 30, 2025, respectively. These expenses were driven by: (i) operating costs of $27.4 million and $63.2 million, respectively, including non-recurring integration costs of $7.6 million and $16.0 million, respectively; and (ii) amortization expense of $25.9 million and $60.4 million, respectively, related to the intangible assets recorded in connection with the GCP Acquisition.
Previous report
We have also incurred acquisition-related operating expenses in connection to the GCP Acquisition of $0.7 million and $35.3 million for the three and nine months ended September 30, 2025, respectively, and $19.2 million and $19.3 million for the three and nine months ended September 30, 2024, respectively. In each case, such costs were largely paid to advisors and professional services providers to assist in completing the transaction.
Previous report
General, administrative and other expenses, excluding the aforementioned impact from the GCP Acquisition, increased by $14.3 million and $29.2 million, or 8% and 6%, for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increases in expenses reflect the continued growth to support staffing levels and fundraising activities. The most significant expense increases were supplemental distribution fees, occupancy costs and information technology costs.
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Reworded paragraphs (71)
Previous wording
The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements of Ares Management Corporation and the related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and the related notes included in the 2024 Annual Report on Form 10-K of Ares Management Corporation. We have reclassified certain prior period amounts to conform to the current year presentation.
Current wording
The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements of Ares Management Corporation and the related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and the related notes included in the 2025 Annual Report on Form 10-K of Ares Management Corporation.
Previous wording
We believe that our disciplined investment philosophy across our distinct but complementary investment groups contributes to the stability of our performance throughout market cycles. For the three months ended September 30, 2025, 94% of our management fees were derived from perpetual capital vehicles or long-dated funds. Our funds have a stable base of committed capital enabling us to invest in assets with a long-term focus over different points in a market cycle and to take advantage of market volatility. However, our results from operations, including the fair value of our AUM, are affected by a variety of factors. Conditions in the global financial markets and economic and political environments may impact our business, particularly in the U.S., Europe and Asia-Pacific (“APAC”).
Current wording
We believe that our disciplined investment philosophy across our distinct but complementary investment groups contributes to the stability of our performance throughout market cycles. For the three months ended March 31, 2026, 93% of our management fees were derived from perpetual capital vehicles or long-dated funds. Our funds have a stable base of committed capital enabling us to invest in assets with a long-term focus over different points in a market cycle and to take advantage of market volatility. However, our results from operations, including the fair value of our AUM, are affected by a variety of factors. Conditions in the global financial markets and economic and political environments may impact our business, particularly in the U.S., Europe and Asia-Pacific (“APAC”).
Previous wording
The commercial real estate markets continued to recover during the quarter, driven by increased transaction volumes and steady property valuations and capitalization rates. The U.S. real estate markets improved, with interest rate cuts also driving positive momentum during the quarter. However, the European real estate markets declined primarily due to political uncertainty and lower rent growth expectations in certain regions. While performance varies by sector and geography, we believe multifamily and industrial properties will continue to benefit from favorable long-term structural trends. In addition, renewable energy continues to scale, with strong transaction volumes supporting elevated revenue contract prices amid positive demand momentum. The climate infrastructure market remained resilient, bolstered by continued progress in clean energy deployment and the expansion of digital infrastructure and adoption of artificial intelligence.
Current wording
Despite elevated uncertainty from the market volatility, global commercial real estate fundamentals strengthened in the first quarter of 2026. Transaction volumes continued to increase, debt availability improved and property values appreciated across markets. Notwithstanding overall strengthening trends, the European and APAC real estate markets demonstrated greater sensitivity to global conditions compared to the U.S. While performance varies by sector and geography, we believe constrained new supply will be a meaningful tailwind for the commercial real estate markets over the next few years. In addition, renewable energy continued to scale, supported by record battery storage additions and strong corporate demand for clean energy. The climate infrastructure market remained resilient, bolstered by continued progress in clean energy deployment, the expansion of digital infrastructure and sustained adoption of artificial intelligence.
Previous wording
We believe our portfolios across all strategies remain well positioned for a fluctuating interest rate environment. On a market value basis, approximately 85% of our debt assets and 52% of our total assets were floating rate instruments as of September 30, 2025.
Current wording
We believe our portfolios across all strategies remain well positioned for a fluctuating interest rate environment. On a market value basis, approximately 83% of our debt assets and 51% of our total assets were floating rate instruments as of March 31, 2026.
Previous wording
(1)Includes $58.7 billion and $43.5 billion from funds that primarily invest in illiquid strategies as of September 30, 2025 and 2024, respectively. The underlying investments held in these funds are generally subject to less market volatility than investments held in liquid strategies.
Current wording
(1)Includes $98.2 billion and $76.7 billion from funds that primarily invest in illiquid strategies as of March 31, 2026 and 2025, respectively. The underlying investments held in these funds are generally subject to less market volatility than investments held in liquid strategies.
Previous wording
We view the duration of funds we manage as a metric to measure the stability of our future management fees. For the three months ended September 30, 2025 and 2024, 94% and 95%, respectively, of management fees were earned from perpetual capital or long-dated funds.
Current wording
We view the duration of funds we manage as a metric to measure the stability of our future management fees. For the three months ended March 31, 2026 and 2025, 93% and 92%, respectively, of management fees were earned from perpetual capital or long-dated funds.
Previous wording
As of September 30, 2025, AUM Not Yet Paying Fees includes $81.0 billion of AUM available for future deployment that could generate approximately $756.3 million in potential incremental annual management fees, which represents 26% embedded gross base management fee growth from the last twelve month period upon deployment. Development assets not yet stabilized represents fund assets that are in the development stage. Upon completion of development, management fees generally increase with a change in fee base, in fee rate or both. As of September 30, 2025, development assets not yet stabilized could generate approximately $22.4 million in potential incremental annual management fees.
Current wording
As of March 31, 2026, AUM not yet paying fees includes $79.4 billion of AUM available for future deployment and $4.2 billion of development assets not yet stabilized that could collectively generate approximately $715.9 million in potential incremental annual management fees, representing a 22% embedded growth rate in our base management fees from the last twelve month period.
Previous wording
Fee related performance revenues are not recognized by us until such fees are crystallized and no longer subject to reversal. As of September 30, 2025, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $32.1 billion, composed of $20.3 billion within the Credit Group, $7.4 billion within the Real Assets Group and $4.4 billion within the Secondaries Group. As of September 30, 2024, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $20.4 billion, composed of $18.5 billion within the Credit Group and $1.9 billion within the Secondaries Group. As of September 30, 2025 and 2024, IGAUM included $58.3 billion and $42.8 billion, respectively, of AUM from funds generating incentive income that is not recognized by us until such fees are crystallized or no longer subject to reversal.
Current wording
Fee related performance revenues are not recognized by us until such fees are crystallized and no longer subject to reversal. As of March 31, 2026, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $42.1 billion, composed of $23.0 billion within the Credit Group, $13.9 billion within the Real Assets Group and $5.2 billion within the Secondaries Group. As of March 31, 2025, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $25.7 billion, composed of $19.5 billion within the Credit Group, $3.5 billion within the Real Assets Group and $2.7 billion within the Secondaries Group. As of March 31, 2026 and 2025, IGAUM included $51.9 billion and $37.9 billion, respectively, of AUM from funds generating incentive income that is not recognized by us until such fees are crystallized or no longer subject to reversal.
Previous wording
The activity of the Consolidated Funds is reflected within the unaudited condensed consolidated financial statement line items indicated by reference thereto. The impact of consolidation also typically will decrease management fees, carried interest allocation and incentive fees reported under GAAP to the extent these amounts are eliminated upon consolidation.
Current wording
The activity of the Consolidated Funds is reflected within the unaudited condensed consolidated financial statement line items indicated by reference thereto. The impact of consolidation also typically will decrease revenues reported under GAAP to the extent these amounts are eliminated upon consolidation.
Previous wording
The assets and liabilities of our Consolidated Funds are held within separate legal entities and, as a result, the liabilities of our Consolidated Funds are typically non-recourse to us. Generally, the consolidation of our Consolidated Funds has a significant gross-up effect on our assets, liabilities and cash flows but has no net effect on the net income attributable to us or our stockholders’ equity, except where accounting for a redemption or liquidation preference requires the reallocation of ownership based on specific terms of a profit sharing agreement. The net economic ownership interests of our Consolidated Funds, to which we have no economic rights, are reflected as redeemable and non-controlling interests in the Consolidated Funds within our unaudited condensed consolidated financial statements. Redeemable interest in Consolidated Funds represent the shares issued by our SPACs that are redeemable for cash by the public shareholders in the event that the SPAC does not complete a business combination or tender offer associated with shareholder approval provisions.
Current wording
The assets and liabilities of our Consolidated Funds are held within separate legal entities and, as a result, the liabilities of our Consolidated Funds are typically non-recourse to us. Generally, the consolidation of our Consolidated Funds has a significant gross-up effect on our assets, liabilities and cash flows but has no net effect on the net income attributable to us or our stockholders’ equity, except where accounting for a redemption or liquidation preference requires the reallocation of ownership based on specific terms of a profit sharing agreement. The net economic ownership interests of our Consolidated Funds, to which we have no economic rights, are reflected as redeemable and non-controlling interests in the Consolidated Funds within our unaudited condensed consolidated financial statements.
Previous wording
We have contributed certain financial interests to structured investment vehicles that we manage, including but not limited to collateralized fund obligations and fund-backed loans. These financial interests include our capital interests and rights to performance income in funds that we manage. The purpose of these contributions is to provide collateral or other forms of similar credit-enhancement, including subordination and liquidity support, to the structured investment vehicles. These structured investment vehicles are typically designed to meet investors’ risk-return, liquidity, diversification and risk-based capital treatment objectives and to support capital raising efforts across our platform. The contribution of these financial interests subjects us to a maximum risk of loss equal to the value of the contributed financial interests in the event that these structured investment vehicles or the underlying financial interests do not perform at required levels, which results in a variable interest and often the consolidation of these investment vehicles by us. As a result, the financial interests that we contribute will typically be reclassified from investments in the funds that we manage and/or from accrued performance income to investments of the Consolidated Funds. Any future investment income and performance income resulting from these financial interests will be presented within the results of operations of our Consolidated Funds as a result of consolidation.
Current wording
We have transferred certain financial interests to structured financing vehicles that we manage, including but not limited to collateralized fund obligations, rated note feeders and private asset-backed notes, among other secondary solutions. These financial interests include our capital interests and rights to performance income in funds that we manage. The purpose of these transferred interests is to provide collateral or other forms of similar credit-enhancement, including subordination and liquidity support, to the structured financing vehicles. These structured financing vehicles are typically designed to meet investors’ risk-return, liquidity, diversification and risk-based capital treatment objectives and to support capital raising efforts across our platform. The transfer of these financial interests does not subject us to the additional risk of loss; instead, our maximum risk of loss equals the value of our transferred interest in the event that the returns generated by the structured financing vehicles do not meet stated performance thresholds. These structured financing vehicles typically represent variable interest entities that are consolidated with our results. As a result, the financial interests that we transfer will typically be reclassified from investments in the funds that we manage and/or from accrued performance income to investments of the Consolidated Funds upon consolidation. Any future investment income and performance income resulting from these financial interests is typically presented within the results of operations of our Consolidated Funds as a result of consolidation.
Previous wording
Management Fees. Within the Credit Group, our publicly-traded and perpetual wealth vehicles contributed to increases in management fees of$44.4 million and $127.8 millionfor thethree and nine months ended September 30, 2025, respectively, compared to the same periods in 2024 primarily driven by increases in the average size of their portfolios. Capital deployment in private funds within our direct lending and alternative credit strategies led to a rise in FPAUM, contributing to increases in management fees of$30.4 million and $83.8 million for thethree and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. Within the Real Assets Group, funds that we manage as a result of the GCP Acquisition and the acquisition of Walton Street Capital Mexico S. de R.L. de C.V. and certain of its affiliates (“WSM”)
Current wording
Management Fees. Within the Credit Group, our publicly-traded and our perpetual wealth funds contributed$37.4 million of the increase in management fees for thethree months ended March 31, 2026 compared to the same period in 2025, primarily driven by increases in the average size of their portfolios. Capital deployment in private funds within our direct lending and alternative credit strategies led to a rise in FPAUM, contributing$29.6 millionof the increase in management fees for thethree months ended March 31, 2026 compared to the same period in 2025. Within the Real Assets Group, funds that we manage as a result of the acquisition of the international business of GLP Capital Partners Limited excluding its operations in Greater China (the “GCP Acquisition”) generated $34.6 million in additional management fees for the three months ended March 31, 2026 compared to one month of fees for the three months ended March 31, 2025.
Previous wording
(“WSM Acquisition”), collectively generated $63.8 million and $160.1 million in additional management fees for the three and nine months ended September 30, 2025, respectively. Part I Fees increased by $20.0 million and $48.1 million for thethree and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. The increases in Part I Fees were primarily attributable to Ares Strategic Income Fund (“ASIF”), our open-ended European direct lending fund, CION Ares Diversified Credit Fund (“CADC”) and our open-ended infrastructure fund, driven by increases in net investment income from their growing portfolio of investments. For detail regarding the fluctuations of management fees within each of our segments, see “—Results of Operations by Segment.”
Current wording
In addition, Part I Fees increased by $29.2 million for thethree months ended March 31, 2026 compared to the same period in 2025. The increase in Part I Fees was primarily attributable to ASIF and our open-ended European direct lending fund, driven by increases in net investment income from their growing portfolios of investments.
Previous wording
The majority of our incentive fees crystallize in the fourth quarter. The increases in incentive fees for the three and nine months ended September 30, 2025 compared to the same periods in 2024 were primarily due to higher incentive fees from an open-ended core alternative credit fund that has an annual measurement period in the third quarter, driven by increased IGAUM and improved fund performance. For further detail regarding the incentive fees within each of our segments, see discussion of fee related performance revenues and realized net performance income within “—Results of Operations by Segment.”
Current wording
The increase in incentive fees for the three months ended March 31, 2026 compared to the same period in 2025 was primarily due to (i) fees of $138.5 million generated by SDL I in connection with the sale of its remaining assets to a continuation vehicle; and (ii) higher fees generated from APMF resulting from increased IGAUM over the comparative period. For further detail regarding the incentive fees within each of our segments, see discussion of fee related performance revenues and realized net performance income within “—Results of Operations by Segment.”
Previous wording
The activity for the three and nine months ended September 30, 2025 was primarily attributable to:
Current wording
The activity for the three months ended March 31, 2025 was primarily attributable to:
Previous wording
•Interest and dividend income for the nine months ended September 30, 2024 included interest income from newly admitted investors in an insurance fund, where capital account balances are reallocated from existing investors in exchange for interest to compensate for carrying costs
Current wording
•Interest income of $7.7 million from newly admitted investors in an insurance fund, where capital account balances are reallocated from existing investors in exchange for interest to compensate for carrying costs
Previous wording
Performance Related Compensation. Changes in performance related compensation are directly associated with the changes in carried interest allocation and incentive fees described above and include associated payroll-related taxes as well as carried interest and incentive fees allocated to charitable organizations as part of our philanthropic initiatives. Performance related compensation generally represents 60% to 80% of carried interest allocation and incentive fees recognized before giving effect to payroll taxes and will vary based on the mix of funds generating carried interest allocation and incentive fees for that period.
Current wording
Performance Related Compensation. The majority of the changes in performance related compensation are directly associated with the changes in carried interest allocation and incentive fees as described above.
Previous wording
Net Realized and Unrealized Gains (Losses) on Investments; Interest and Dividend Income. For investments where we do not serve as general partner, we present the activity of net realized and unrealized gains on investments and interest and dividend income together with net cash received or used.
Current wording
Net Realized and Unrealized Gains on Investments; Interest and Dividend Income. The activity for the three months ended March 31, 2026 was primarily attributable to:
Previous wording
•Interest and dividend income primarily included: (i) dividend income from our strategic investment in a Brazilian alternative asset manager; and (ii) income from our investments in CLOs and CLO-based investments
Current wording
•Interest and dividend income primarily included: (i) dividend income of $3.9 million from our strategic investment in a Brazilian alternative asset manager and from our investment in J-REIT; and (ii) income of $1.1 million from our investments in CLOs and CLO-based investments
Previous wording
•Interest and dividend income primarily included: (i) dividend income from our strategic investment in a Brazilian alternative asset manager; and (ii) income from our investments in CLOs and CLO-based investments. The nine months ended September 30, 2025 included $11.9 million of interest income earned from treasury-backed securities. These treasury-backed securities were sold and the proceeds from the sale were used to fund the GCP Acquisition.
Current wording
•Interest and dividend income primarily included: (i) income of $2.1 million from our investments in CLOs and CLO-based investments; (ii) dividend income of $2.0 million from our strategic investment in a Brazilian alternative asset manager; and (iii) $11.9 million of interest income earned from treasury-backed securities. These treasury-backed securities were sold in the first quarter of 2025 and the proceeds from the sale were used to fund the GCP Acquisition.
Previous wording
The increases in income tax expense were primarily attributable to higher pre-tax income allocable to AMC and higher entity level taxes in foreign and local jurisdictions for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024.
Current wording
The increase in income tax expense was primarily attributable to higher pre-tax income allocable to AMC and higher entity level taxes in foreign and local jurisdictions for the three months ended March 31, 2026 compared to the same period in 2025.
Previous wording
The changes in ownership compared to the prior year periods were primarily driven by the issuances of shares of Class A common stock in connection with exchanges of AOG Units, the GCP Acquisition and vesting of restricted unit awards.
Current wording
The change in ownership compared to the prior year period was primarily driven by the issuances of shares of Class A common stock in connection with the vesting of restricted unit awards and exchanges of AOG Units.
Previous wording
The changes in net income attributable to non-controlling interests in AOG entities over the comparative periods were a result of the respective changes in income before taxes and weighted average daily ownership, as presented above.
Current wording
The change in net income attributable to non-controlling interests in AOG entities compared to the prior year period was primarily a result of the respective change in income before taxes of the Company as presented above.
Previous wording
The results of operations of the Consolidated Funds primarily represent activities from certain funds that we are deemed to control. When a fund is consolidated, we reflect the revenues and expenses of the entity on a gross basis, subject to eliminations from consolidation. Substantially all of our results of operations related to the Consolidated Funds are attributable to ownership interests that third parties hold in those funds. The Consolidated Funds are not necessarily the same funds in each year presented due to changes in ownership, changes in limited partners’ or investor rights, and the creation or termination of funds and entities. Accordingly, such amounts may not be comparable for the periods presented, and in any event have no material impact on net income attributable to Ares Management Corporation.
Current wording
The results of operations of the Consolidated Funds primarily represent activities from certain funds that we are deemed to control. When a fund is consolidated, we reflect the revenues and expenses of the entity on a gross basis, subject to eliminations from consolidation. A substantial portion of our results of operations related to the Consolidated Funds are attributable to ownership interests that third parties hold in those funds. The Consolidated Funds are not necessarily the same funds in each year presented due to changes in ownership, changes in limited partners’ or investor rights, and the creation or termination of funds and entities. Accordingly, such amounts may not be comparable for the periods presented, and in any event have no material impact on net income attributable to Ares Management Corporation.
Previous wording
For segment reporting purposes, revenues and expenses are presented before giving effect to the results of our Consolidated Funds and the results attributable to non-controlling interests of joint ventures that we consolidate. As a result, segment revenues from management fees, fee related performance revenues, performance income and investment income are different than those presented on a consolidated basis in accordance with GAAP. Revenues recognized from Consolidated Funds are eliminated in consolidation and those attributable to the non-controlling interests of joint ventures have been excluded by us. Furthermore, expenses and the effects of other income (expense) are different than related amounts presented on a consolidated basis in accordance with GAAP due to the exclusion of the results of Consolidated Funds and the non-controlling interests of joint ventures.
Current wording
For segment reporting purposes, revenues and expenses are presented before giving effect to the results of our Consolidated Funds and the results attributable to non-controlling interests of joint ventures that we consolidate. As a result, segment revenues are different than those presented on a consolidated basis in accordance with GAAP. Revenues recognized from Consolidated Funds are eliminated in consolidation and those attributable to the non-controlling interests of joint ventures have been excluded by us. Furthermore, expenses and the effects of other income (expense) are different than related amounts presented on a consolidated basis in accordance with GAAP due to the exclusion of the results of Consolidated Funds and the non-controlling interests of joint ventures.
Previous wording
FRE and RI should be considered in addition to and not in lieu of, the results of operations, which are discussed further under “—Consolidated Results of Operations of the Company” and are prepared in accordance with GAAP. We operate through our distinct operating segments. In the first quarter of 2025, we combined the presentation of real estate strategies and infrastructure strategies within Real Assets. Real estate includes Americas real estate equity, European real estate equity, APAC real estate equity and real estate debt. Americas real estate equity, which we had recently renamed from North American real estate equity, now includes the activities of Brazil following the GCP Acquisition. APAC real estate equity is newly established following the GCP Acquisition and primarily represents the activities in Japan and Vietnam. Infrastructure includes digital infrastructure, infrastructure opportunities and infrastructure debt. Digital infrastructure is newly established following the GCP Acquisition. The change in presentation did not result in any change to the historical composition of our segments.
Current wording
FRE and RI should be considered in addition to and not in lieu of, the results of operations, which are discussed further under “—Consolidated Results of Operations of the Company” and are prepared in accordance with GAAP.
Previous wording
(1)Represents bonus payments, a portion of contingent liabilities (“earnouts”) and other costs in connection with various acquisitions that are recorded as compensation expense and are presented within compensation and benefits within our Condensed Consolidated Statements of Operations.
Current wording
(1)Represents bonus payments, a portion of earnouts and other costs in connection with various acquisitions that are recorded as compensation expense and are presented within compensation and benefits within our Condensed Consolidated Statements of Operations.
Previous wording
The following table presents the components of and causes for changes in the Credit Group’s management fees for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 ($ in millions):
Current wording
The following table presents the components of and causes for changes in the Credit Group’s management fees for the three months ended March 31, 2026 compared to the prior year period ($ in millions):
Previous wording
Fee Related Performance Revenues. Fee related performance revenues increased for the three and nine months ended September 30, 2025 compared to the same periods in 2024 primarily due to higher incentive fees from an open-ended core alternative credit fund that has an annual measurement period in the third quarter, driven by increased IGAUM and improved fund performance. Fee related performance revenues for the nine months ended September 30, 2025 were also attributable to incentive fees earned from a European direct lending fund that crystallized a deferred payment during the first quarter of 2025 due to the restructuring of its hold back provisions.
Current wording
Fee Related Performance Revenues. Fee related performance revenues decreased for the three months ended March 31, 2026 compared to the same period in 2025. Fee related performance revenues for the three months ended March 31, 2026 were primarily attributable to incentive fees from our open-ended sports, media and entertainment opportunities fund, which has a quarterly measurement period and a fee waiver that expired at the end of 2025. Fee related performance revenues for the three months ended March 31, 2025 were primarily attributable to incentive fees from a European direct lending fund that crystallized fees following the restructuring of its hold back provisions.
Previous wording
Other Fees. The increases in other fees for the three and nine months ended September 30, 2025 compared to the same periods in 2024 were primarily driven by higher administrative service fees of $2.2 million and $5.2 million, respectively, which are earned from certain private funds that pay on invested capital.
Current wording
Other Fees. The increase in other fees for the three months ended March 31, 2026 compared to the same period in 2025 was primarily driven an increase in administrative service fees of $3.1 million, which are earned from certain private funds that pay on invested capital. In addition, capital markets transaction fees were higher by $1.7 million, reflecting increased transaction volumes.
Previous wording
Full-time equivalent headcount increased by 6% to 701 investment and investment support professionals for the year-to-date period in 2025 from 663 professionals in 2024 to support our growing direct lending and alternative credit platforms.
Current wording
Full-time equivalent headcount increased by 4% to 729 investment and investment support professionals for the year-to-date period in 2026 from 698 professionals in 2025 primarily due to the impact of the BlueCove Acquisition and also to support our growing direct lending and alternative credit platforms.
Previous wording
(2)Includes $87.8 billion and $67.8 billion from funds that primarily invest in illiquid strategies as of September 30, 2025 and 2024, respectively. The underlying investments held in these funds are generally subject to less market volatility than investments held in liquid strategies.
Current wording
(1)Includes $61.9 billion and $50.4 billion from funds that primarily invest in illiquid strategies as of March 31, 2026 and 2025, respectively. The underlying investments held in these funds are generally subject to less market volatility than investments held in liquid strategies.
Previous wording
ARCC contributed approximately 31% of the Credit Group’s total management fees for the nine months ended September 30, 2025. In addition, the Credit Group’s other significant funds, which are presented in the tables below, collectively contributed approximately 40% of the Credit Group’s management fees for the nine months ended September 30, 2025.
Current wording
ARCC contributed approximately 29% of the Credit Group’s total management fees for the three months ended March 31, 2026. In addition, the Credit Group’s other significant funds, which are presented in the tables below, collectively contributed approximately 45% of the Credit Group’s management fees for the three months ended March 31, 2026.
Previous wording
The following table presents the performance data for our significant funds that are not drawdown funds in the Credit Group as of September 30, 2025 ($ in millions):
Current wording
The following table presents the performance data for our significant perpetual capital funds in the Credit Group as of March 31, 2026 ($ in millions):
Previous wording
(4)Returns are time-weighted rates of return and include the reinvestment of income and other earnings from securities or other investments and reflect the deduction of all trading expenses. The fund is made up of a Main Class (“Class M”) and a Constrained Class (“Class C”). Class M includes investors electing to participate in all investments and Class C includes investors electing to be excluded from exposure to liquid investments. Returns presented in the table are for onshore Class M. The current quarter gross and net returns for Class M (offshore) are 3.1% and 2.3%, respectively. The year-to-date gross and net returns for Class M (offshore) are 9.3% and 6.8%, respectively. The since inception gross and net returns for Class M (offshore) are 11.7% and 8.3%, respectively. The current quarter gross and net returns for Class C (offshore) are 2.9% and 2.2%, respectively. The year-to-date gross and net returns for Class C (offshore) are 8.4% and 6.2%, respectively. The since inception gross and net returns for Class C (offshore) are 11.3% and 8.1%, respectively.
Current wording
(4)Returns are time-weighted rates of return and include the reinvestment of income and other earnings from securities or other investments and reflect the deduction of all trading expenses. The fund is made up of a Main Class (“Class M”) and a Constrained Class (“Class C”). Class M includes investors electing to participate in all investments and Class C includes investors electing to be excluded from exposure to liquid investments. Returns presented in the table are for onshore Class M. The current quarter gross and net returns for Class M (offshore) are 2.6% and 1.8%, respectively. The since inception gross and net returns for Class M (offshore) are 11.8% and 8.4%, respectively. The current quarter gross and net returns for Class C (offshore) are 2.4% and 1.7%, respectively. The since inception gross and net returns for Class C (offshore) are 11.3% and 8.1%, respectively. Metrics for the rated note feeder funds are not shown separately.
Previous wording
(7)ACE VI is made up of six parallel funds, four denominated in Euros and two denominated in pound sterling: ACE VI (E) Unlevered, ACE VI (E) II Unlevered, ACE VI (G) Unlevered, ACE VI (E) Levered, ACE VI (E) II Levered, and ACE VI (G) Levered, and three feeder funds: ACE VI (D) Levered, ACE VI (Y) Unlevered and ACE VI (D) Rated Notes. ACE VI (E) II Levered includes ACE VI (D) Levered feeder fund and ACE VI (E) II Unlevered includes ACE VI (Y) Unlevered and ACE VI (D) Rated Notes feeder funds. The gross and net IRR and gross and net MoIC presented in the table are for ACE VI (E) Unlevered and ACE VI (E) Levered. Metrics for ACE VI (E) II Levered exclude the ACE VI (D) Levered feeder fund and metrics for ACE VI (E) II Unlevered exclude ACE VI (Y) Unlevered and ACE VI (D) Rated Notes feeder funds. The gross and net IRR for ACE VI (G) Unlevered are 15.0% and 10.5%, respectively. The gross and net MoIC for ACE VI (G) Unlevered are 1.2x and 1.1x, respectively. The gross and net IRR for ACE VI (G) Levered are 24.3% and 14.4%, respectively. The gross and net MoIC for ACE VI (G) Levered are 1.2x and 1.1x, respectively. The gross and net IRR for ACE VI (E) II Unlevered are 13.1% and 9.2%, respectively. The gross and net MoIC for ACE VI (E) II Unlevered are 1.1x and 1.1x, respectively. The gross and net IRR for ACE VI (E) II Levered are 21.1% and 15.2%, respectively. The gross and net MoIC for ACE VI (E) II Levered are 1.2x and 1.2x, respectively. The gross and net IRR for ACE VI (D) Levered are 24.4% and 18.6%, respectively. The gross and net MoIC for ACE VI (D) Levered are 1.2x and 1.2x, respectively. The gross and net IRR for ACE VI (Y) Unlevered are 9.9% and 6.4%, respectively. The gross and net MoIC for ACE VI (Y) Unlevered are 1.1x and 1.1x, respectively. The gross and net IRR for ACE VI (D) Rated Notes are 20.5% and 12.5%, respectively. The gross and net MoIC for ACE VI (D) Rated Notes are 1.2x and 1.1x, respectively. Original capital commitments are converted to U.S. Dollars at the prevailing exchange rate at the time of the fund's closing. All other values for ACE VI Unlevered and ACE VI Levered are for the combined levered and unlevered parallel funds and are converted to U.S. dollars at the prevailing quarter-end exchange rate.
Current wording
(7)ACE VI is made up of six parallel funds, four denominated in Euros and two denominated in GBP: ACE VI (E) Unlevered, ACE VI (E) II Unlevered, ACE VI (G) Unlevered, ACE VI (E) Levered, ACE VI (E) II Levered, and ACE VI (G) Levered, and three feeder funds: ACE VI (D) Levered, ACE VI (Y) Unlevered and ACE VI (D) Rated Notes. ACE VI (E) II Levered includes ACE VI (D) Levered feeder fund and ACE VI (E) II Unlevered includes ACE VI (Y) Unlevered and ACE VI (D) Rated Notes feeder funds. The gross and net IRR and gross and net MoIC presented in the table are for ACE VI (E) Unlevered and ACE VI (E) Levered. Metrics for ACE VI (E) II Levered exclude the ACE VI (D) Levered feeder fund and metrics for ACE VI (E) II Unlevered exclude ACE VI (Y) Unlevered and ACE VI (D) Rated Notes feeder funds. The gross and net IRR for ACE VI (G) Unlevered are 13.9% and 9.9%, respectively. The gross and net MoIC for ACE VI (G) Unlevered are 1.2x and 1.1x, respectively. The gross and net IRR for ACE VI (G) Levered are 21.8% and 12.9%, respectively. The gross and net MoIC for ACE VI (G) Levered are 1.3x and 1.2x, respectively. The gross and net IRR for ACE VI (E) II Unlevered are 12.1% and 8.5%, respectively. The gross and net MoIC for ACE VI (E) II Unlevered are 1.2x and 1.1x, respectively. The gross and net IRR for ACE VI (E) II Levered are 18.8% and 13.2%, respectively. The gross and net MoIC for ACE VI (E) II Levered are 1.2x and 1.2x, respectively. The gross and net IRR for ACE VI (D) Levered are 21.0% and 16.1%, respectively. The gross and net MoIC for ACE VI (D) Levered are 1.3x and 1.2x, respectively. The gross and net IRR for ACE VI (Y) Unlevered are 10.2% and 6.9%, respectively. The gross and net MoIC for ACE VI (Y) Unlevered are 1.1x and 1.1x, respectively. The gross and net IRR for ACE VI (D) Rated Notes are 19.8% and 13.3%, respectively. The gross and net MoIC for ACE VI (D) Rated Notes are 1.3x and 1.2x, respectively. Original capital commitments are converted to U.S. Dollars at the prevailing exchange rate at the time of the fund’s closing. All other values for ACE VI Unlevered and ACE VI Levered are for the combined levered and unlevered parallel funds and are converted to U.S. Dollars at the prevailing quarter-end exchange rate.
Previous wording
(8)SDL III Unlevered includes investor commitments in three currencies: U.S. dollars, pound sterling, and yen. The gross and net IRR and MoIC presented in the table are for investors committed in U.S. dollars. Original capital commitments are converted to U.S. dollars at the prevailing exchange rate at the time of the fund's closing. All other values for SDL III Unlevered are for the combined fund and are converted to U.S. dollars at the prevailing quarter-end exchange rate.
Current wording
(8)SDL III Unlevered includes investor commitments in three currencies: U.S. Dollars, GBP, and Yen. The gross and net IRR and MoIC presented in the table are for investors committed in U.S. Dollars. The gross and net IRR for investors committed in GBP are 11.2% and 8.2%, respectively. The gross and net MoIC for investors committed in GBP are 1.1x and 1.1x, respectively. The gross and net IRR for investors committed in Yen are 6.8% and 3.8%, respectively. The gross and net MoIC for investors committed in Yen are 1.1x and 1.0x, respectively. Original capital commitments are converted to U.S. Dollars at the prevailing exchange rate at the time of the fund’s closing. All other values for SDL III Unlevered are for the combined fund and are converted to U.S. Dollars at the prevailing quarter-end exchange rate.
Previous wording
(9)ACE IV is made up of four parallel funds, two denominated in Euros and two denominated in pound sterling: ACE IV (E) Unlevered, ACE IV (G) Unlevered, ACE IV (E) Levered and ACE IV (G) Levered and one feeder fund: ACE IV (D) Levered. ACE IV (E) Levered includes the ACE IV (D) Levered feeder fund. The gross and net IRR and MoIC presented in the table are for ACE IV (E) Unlevered and ACE IV (E) Levered. Metrics for ACE IV (E) Levered exclude the U.S. dollar denominated feeder fund. The gross and net IRR for ACE IV (G) Unlevered are 9.6% and 7.0%, respectively. The gross and net MoIC for ACE IV (G) Unlevered are 1.5x and 1.4x, respectively. The gross and net IRR for ACE IV (G) Levered are 12.3% and 8.7%, respectively. The gross and net MoIC for ACE IV (G) Levered are 1.7x and 1.5x, respectively. The gross and net IRR for ACE IV (D) Levered are 12.4% and 9.1%, respectively. The gross and net MoIC for ACE IV (D) Levered are 1.7x and 1.5x, respectively. Original capital commitments are converted to U.S. dollars at the prevailing exchange rate at the time of the fund’s closing. All other values for ACE IV Unlevered and ACE IV Levered are for the combined levered and unlevered parallel funds and are converted to U.S. dollars at the prevailing quarter-end exchange rate.
Current wording
(9)ACE IV is made up of four parallel funds, two denominated in Euros and two denominated in GBP: ACE IV (E) Unlevered, ACE IV (G) Unlevered, ACE IV (E) Levered and ACE IV (G) Levered and one feeder fund: ACE IV (D) Levered. ACE IV (E) Levered includes the ACE IV (D) Levered feeder fund. The gross and net IRR and MoIC presented in the table are for ACE IV (E) Unlevered and ACE IV (E) Levered. Metrics for ACE IV (E) Levered exclude the U.S. Dollar denominated feeder fund. The gross and net IRR for ACE IV (G) Unlevered are 9.4% and 6.9%, respectively. The gross and net MoIC for ACE IV (G) Unlevered are 1.5x and 1.4x, respectively. The gross and net IRR for ACE IV (G) Levered are 12.1% and 8.6%, respectively. The gross and net MoIC for ACE IV (G) Levered are 1.7x and 1.5x, respectively. The gross and net IRR for ACE IV (D) Levered are 12.2% and 8.9%, respectively. The gross and net MoIC for ACE IV (D) Levered are 1.7x and 1.5x, respectively. Original capital commitments are converted to U.S. Dollars at the prevailing exchange rate at the time of the fund’s closing. All other values for ACE IV Unlevered and ACE IV Levered are for the combined levered and unlevered parallel funds and are converted to U.S. Dollars at the prevailing quarter-end exchange rate.
Previous wording
(10)ACE V is made up of four parallel funds, two denominated in Euros and two denominated in pound sterling: ACE V (E) Unlevered, ACE V (G) Unlevered, ACE V (E) Levered, and ACE V (G) Levered, and two feeder funds: ACE V (D) Levered and ACE V (Y) Unlevered. ACE V (E) Levered includes the ACE V (D) Levered feeder fund and ACE V (E) Unlevered includes the ACE V (Y) Unlevered feeder fund. The gross and net IRR and gross and net MoIC presented in the table are for ACE V (E) Unlevered and ACE V (E) Levered. Metrics for ACE V (E) Levered exclude the ACE V (D) Levered feeder fund and metrics for ACE V (E) Unlevered exclude the ACE V (Y) Unlevered feeder fund. The gross and net IRR for ACE V(G) Unlevered are 11.9% and 9.0%, respectively. The gross and net MoIC for ACE V (G) Unlevered are 1.4x and 1.3x, respectively. The gross and net IRR for ACE V (G) Levered are 15.6% and 11.3%, respectively. The gross and net MoIC for ACE V (G) Levered are 1.5x and 1.4x, respectively. The gross and net IRR for ACE V (D) Levered are 14.8% and 11.1%, respectively. The gross and net MoIC for ACE V (D) Levered are 1.5x and 1.4x, respectively. The gross and net IRR for ACE V (Y) Unlevered are 10.3% and 7.4%, respectively. The gross and net MoIC for ACE V (Y) Unlevered are 1.3x and 1.2x, respectively. Original capital commitments are converted to U.S. dollars at the prevailing exchange rate at the time of the fund's closing. All other values for ACE V Unlevered and ACE V Levered are for the combined levered and unlevered parallel funds and are converted to U.S. dollars at the prevailing quarter-end exchange rate.
Current wording
(10)ACE V is made up of four parallel funds, two denominated in Euros and two denominated in GBP: ACE V (E) Unlevered, ACE V (G) Unlevered, ACE V (E) Levered, and ACE V (G) Levered, and two feeder funds: ACE V (D) Levered and ACE V (Y) Unlevered. ACE V (E) Levered includes the ACE V (D) Levered feeder fund and ACE V (E) Unlevered includes the ACE V (Y) Unlevered feeder fund. The gross and net IRR and gross and net MoIC presented in the table are for ACE V (E) Unlevered and ACE V (E) Levered. Metrics for ACE V (E) Levered exclude the ACE V (D) Levered feeder fund and metrics for ACE V (E) Unlevered exclude the ACE V (Y) Unlevered feeder fund. The gross and net IRR for ACE V(G) Unlevered are 11.6% and 8.7%, respectively. The gross and net MoIC for ACE V (G) Unlevered are 1.4x and 1.3x, respectively. The gross and net IRR for ACE V (G) Levered are 15.2% and 10.9%, respectively. The gross and net MoIC for ACE V (G) Levered are 1.6x and 1.4x, respectively. The gross and net IRR for ACE V (D) Levered are 14.5% and 10.8%, respectively. The gross and net MoIC for ACE V (D) Levered are 1.5x and 1.4x, respectively. The gross and net IRR for ACE V (Y) Unlevered are 11.4% and 8.3%, respectively. The gross and net MoIC for ACE V (Y) Unlevered are 1.4x and 1.3x, respectively. Original capital commitments are converted to U.S. Dollars at the prevailing exchange rate at the time of the fund’s closing. All other values for ACE V Unlevered and ACE V Levered are for the combined levered and unlevered parallel funds and are converted to U.S. Dollars at the prevailing quarter-end exchange rate.
Previous wording
The decreases in effective management fee rate for the three and nine months ended September 30, 2025 compared to the same periods in 2024 were primarily driven by lower effective management fee rates from funds that we manage as a result of the GCP Acquisition and the impact of the fees received from these funds. Certain of these funds pay management fees based on net operating income and we present the associated effective management fee rates as a percentage of fund assets, which may result in greater variability in the Real Assets Group’s effective management fee rate. In addition, due to the vertically integrated focus of the acquired platform following the GCP Acquisition, we expect the size and composition of other fees earned from these funds will increase relative to management fees.
Current wording
The decrease in effective management fee rate for the three months ended March 31, 2026 compared to the same period in 2025 was primarily driven by lower effective management fee rates from funds that we manage as a result of the GCP Acquisition. Certain of these funds pay management fees based on net operating income and we present the associated effective management fee rates as a percentage of fund assets, which may result in greater variability in the Real Assets Group’s effective management fee rate. In addition, due to the vertically integrated focus of the acquired platform following the GCP Acquisition, we expect the size and composition of other fees earned from certain funds will increase relative to management fees.
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Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
For detail regarding the fluctuations of management fees within each of our segments, see “—Results of Operations by Segment.”
Current report — wording carried from elsewhere
The activity for the three months ended March 31, 2025 was primarily attributable to:
Current report — wording carried from elsewhere
The following table presents the performance data of the Private Equity Group’s significant drawdown fund as of March 31, 2026 ($ in millions):
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
•Interest and dividend income primarily generated from our investments in various funds within our real estate strategy. The nine months ended September 30, 2025 also included interest income from newly admitted investors in an insurance fund, where capital account balances are reallocated from existing investors in exchange for interest to compensate for carrying costs.
Previous report — wording carried elsewhere
The following table presents the performance data of the Real Assets Group’s significant drawdown funds as of September 30, 2025 ($ in millions):
Previous report — wording carried elsewhere
The following table presents the performance data of the Private Equity Group’s significant drawdown funds as of September 30, 2025 ($ in millions):