KKR & Co. (KKR) 1 Nov 222022 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to KKR's Third Quarter 2022 Earnings Conference Call. [Operator Instructions]. I will now hand the call over to Craig Larson, Head of Investor Relations for KKR. Craig, please go ahead, sir.

operator. you, Thank everyone. Good morning, our third call. to XXXX quarter Welcome earnings joined Lewin, Nuttall, our This Co-Chief morning, Financial Rob I'm usual, Scott as Chief by Officer; Officer. Executive our and measures that We'd remind in Investor our is reconciled we'll Center on which figures the release, on refer to like GAAP call, everyone to available to press section are which kkr.com. non-GAAP the at basis. our reminder, a on numbers as segment we report adjusted And share an future will contain which events forward-looking or guarantee call This do performance. statements, not earnings our factors to Please our cautionary and refer filings for release about SEC these statements. call to begin spending going walking I'm minutes through quarter. the by a few the

So our think business I we they of the resiliency our look model. at really results, highlight

for were over meaningful within transaction management months for markets fee through quarter. our fees up were which, million. separately most Real Assets growth That's our business million to last the quarter has quarter you'll recall, reporting To been and go year. monitoring $XXX began Our quarter XX% well million. as last Management the for we the fees with Net XX as expenses. $XXX as QX $XXX the contributing compared of capital last

margin quarters, and operating quarter, $XXX margin eighth XX%. million was the consecutive increased share an has with fee-related per other with total, last consistent exceeded The $XXX FRE FRE now margin coming of modestly earnings XX.X%, from million. quarter XX%. at grew is to Our expenses in -- In compensation fee-related prior that our our or this $X.XX

income, across volatility driven was similar together, the doors, to Fiserv and these Healthcare. as model. complete given driven looking speaks million, monetization breadth X realized X investment monetization we think ahead at of our together last interest overhead really the markets with events. monetizations of this income gains picture by our first realized Realized year, $XXX by Adding of of Max of performance activities to $XXX realized all CHI performance are well again, Next, months platform, million, the with resiliency a year in was our investment income experienced XXXX, so realized lines of for Total the realized income, the as XX% get of business carried

operating distributable So our earnings. million. million very earnings had $XXX $XXX Management quarter, per Asset million operating this Insurance earnings generating And of were resulted overall, share. another our $XXX after-tax in Together, or strong of $X.XX segment

Turning to investment performance.

can and the You X the period of the release. see on quarter press the details Page of LTM

a has portfolio XX was X% MSCI with and this to was X% of compared down Assets, our at that quarter a is to And in X% perform plus X quarter last again XX%, respectively. while in months, down the were looking In quarter was up in estate World portfolio last over portfolio XX% that The indices infra lot the XX indices Just was volatility. and Real page, quarter minus and minus the X% to LTM. portfolio XX% and traditional equity the portfolio the continued over plus opportunistic S&P were months, PE the real compared in private broad the down the to X%. the XXX

months the last as last up high-yield portfolio and up in X% periods the X% over alternative X% leveraged X% point for XX X% volatility been portfolio down over and was down On the the the in in was meaningful the and a is index the our and off the as side, markets credit XX% the quarter months, credit quarter of XX credit well. over There's quarter declined just comparison. these in LTM. The

a LTM. which balance up over quarter, was down XX X% moment on the Core and over still the private and it's in sheet our equity, in is investment largest the flat X% months. in allocation, In was X% last up will quarter performance terms and of investments, the our touch Rob

quarter. Turning AUM $XXX that, and have the billion. management these FPAUM years, raised than billion, assets over to now our raised increased to fundraising million our paying $XX billion, figures in perspective, and $XX under totals fee help the capital past We to bringing $XXX into both To year-to-date. more put With our new doubled. X AUM

to remainder deployment over with turn continue and private of split invested And capital between strategies roughly I'm with invested real pleased Credit call with And quarter, the to billion the to equity. billion the $X also in deploy QX. quarter's Rob. in We assets $XX the that,

morning, Craig, a everyone. Thanks and good lot,

few me saying environment. by Let a operating start words the on

global them are the you the of High and markets. knock-on activity XXXX, sharp in been the consumers, markets significantly capital and clearly year-to-date. are economy. across In were very rates quarter is bond slowed. norms. equity historical all virtually of while X Global much third has really significantly slow levels has down invariably and challenging the of and increase issuance first multiple indices volatile very global meaningfully As will effects know, inflation below turn, interest credit impacting had that of And equity have months

of would to we we X KKR key through Now do. despite sentiment uncertainty, and volatility this worthwhile way reasons the thought all across feel is morning be quite mood And why it positive. and we go overall the this

for a remind our committed of or like our average more well me is capital from positions reasons or years inception. periods of About model key us business few you XX% for an let There perpetual First, one. why. X this why are

fees from visibility in the continued are And as much Our predictable, management result, invested of more our with calculated invest and firm that for into to are largely are turn, provides funds. back fees or of on highly management Therefore, us committed insulated growth. ability the our fluctuating NAVs capital. a

in on that critical we moments $XX from use most dislocation. basis committed we rate have like average points. a and of our these, into may about $XXX has uncalled investors to We of current yet of capital can fee invest turn billion weighted finally, capital the management have also to that be XXX And billion

when also a while helpful XX, in March I ago, X.X While in those firm, where meaningful back. own years short as to it's viewed statistics all a their even XXXX. were are comparison think we right,

we powder $XX right had So entered dry a earn billion committed COVID, That as with the yet billion and of billion to capital mentioned of I $XXX to billion we $XX moment ago. fees. compares management $XX

you second Global partnership deploy and doubled by the Atlantic diversification account timing in largely that we due and amount as have less of with reason perpetual as both of KJRM in numbers relative dry is these to are business, X.X had for brings the figures increase meaningful of positioning over scarce. position both more acquisition to or So and when as for a the our our we And of capital and optimism. firm, quite have due fundraising me don't fortunate our We're a definitely a luck capital. years. those success to significant last while in strategy. my a consider the our well with powder to increase dislocated This bit on geography our prices of significant more asset

a a opportunity constructive As become our more we to lot are sets. result, starting on

the across opportunities credit landscape. finding already are We

asset exciting our active. Our But real classes for to geographies. estate all more the corporate outlook are very credit and is and across XX XX coming teams all months

GFC to ago. opportunity. we capital given the able our geographies, outperform put and have set ourselves distress. industries We to see as a expertise are and And ensure private result teams the that this asset And resources client early in work that or our across opportunity firm from we better. make both really went present our could work. the example, our environment, incentivizes importantly, Take We Think other here what a against that is an really our can and mobilizing key breadth years capability we the XXXXs, equity. to in information each and periods growing best classes. up be to culture investments travel market of most to such and XXXX made to Oftentimes, through we across during people vintages our for of think couple what

As a positioned are creative investment to we result, opportunities. attractive and uniquely find

Page third turn release. which performance, is to earnings the to of now Turning my X point. Please

through This their performance for across only as our the doesn't it our went though, classes. investment investment funds the inception. indices. quarter, comparable quarter XX-month capture trailing really period major report since asset to returns Craig and As outperform These we story continue tells every part of all public

can Our us all really achieve in outcomes to produce relying we've just that classes. doing. they what what asset is traditional And differentiated clients, been compared to channels

to capital The my existing continues excess be many investment reasons availability to go. balance XX capital backdrop active can why years critical our in from brings $XX wish that deploy fundraising months, market. both There's To ability that ever, periods generate of in now. past on doesn't have portfolio our fund they we kind And point. in corporate difficult Now And to that today outlook in of approach, strength looking continue are capital outperformance, our times, future, performance thematic situations the to scaling our to But coming we XX finally, see focus manage. will, we X handful compelling that more had point. know really to about and talked which us a our a my clear, and firm confident and I a generates allow to strategies have and me which of like confidence our time. to we our in and quarter build And strength was largest of very on flagships construction, that number perspective, to raised second to market. the the to you investment challenging more focus new and this creates fourth to year-to-date and than opportunities a the Part best are brings against for billion already still turn right we that investors. more I constructive of capital next want sheet have Even much calendar same and scale help over returns these. fifth that's the many put few this fundraising our our the raise at with more year what differentiation a also our not of QX have remain of about competitive is of $XX notably, the the portfolio. billion. the fundraising in ahead our this are to certainly

and the well. going, is focus puck us has on Our served allocation asset where really

and basis the over several points these was XXX and years, ahead last periods. Also over XX%. X the have our While S&P sheet balance XX% X.X%. last And XX% X our XX S&P hundred been the only declined the over months, returns of annual off

our our exposure key we this real fair made X/XX One ago,to $X.X today of few investments shift assets increased ago $X.X assets. of billion increase The the to real that almost investment our as drivers have X/X years is of the to of represent of a X portfolio. years value from and billion outperformance

Our on to us building play core balance largest allocation remains balance the this private equity, really allows and the and how into business sheet offense. gets sheet

stable we reminder, businesses with risk return to our profile a and cash have believe earnings strategy, As result, and hold solid investment these model. XX we can is as years secular to equity a a a high-teens benefit core investments for they compared These positions, a compound that more XX-plus to expect dynamics for of private are tailwinds market we modest strong profile. IRRs mid- where decade. PE north carry flow from gross looking traditional to We're long-duration for defensible more a believe

is compounding And incredibly world. and interest our alongside That is all powerful. So core with portfolio management we together companies We with capital XX participating on management the sheet carried third-party the billion core combination the really capital. fees, ago, the both in believe asset shareholders, PE markets as global years balance revenue, of balance generated $XX in business is X we've sheet, capital incredible that are value this together through from standing a that largest of earnings start AUM we have fee-related time. put of over

Our right period to of our example on dislocation. during the that of perhaps Global play in July XXXX, best COVID, is Atlantic the acquisition of sheet positions offense heels balance could severe of others when how us not

management like be We conviction partnered we GA that equity, a much have with long-term and rate private compounder first are capital deep can of here core team. a

So performing exceptionally well. far, been has GA

And XX%. the our an XX Over they well about months, generated last of have expectations. of ahead ROE

just Atlantic While grow We where scale compelling billion X the but ways can announcement of know simultaneously billion find the returns drive AUM are Private has over $XXX really it to to the that our model to asset examples, they're also great allow helping we us of and management sheet increased use Global will at at investment and as from approximately use generate to Equity same continue to X/XX, balance many. economics. $XX Core our firm to pace. and also

created also liability a real allows offense structure that on playing have for in our We balance this sheet environment.

approximately funded debt tax. and Obviously, opportunities. this, a for very now. average asset replicable intentionally why so years, coupon is isn't that we long-dated of fixed represents recourse huge capital. have ourselves We fixed cost is X% right after liabilities The hopefully, our our clear long-term it just and it's today excited of maturity weighted that of remain With about of XX have average around with us all a

XX them. balance with recurring we over inside competitively. from XX next durable we achieve like opportunities we here. five, set immense, in the meaningful and investment and is more next have So revenues. XX our performance success differentiator right number value should given is and the X deployment is fourth, whose months a to summary, three, notable, behalf well growth generating are strategic great now. front present constructive backdrop, is felt so positioned very is our in even invest finally, positioned moments of excellent the positioned the model better opportunity the us That's sheet one, well of firm are we years in clients. to to number to diverse why Two, our remain tone And Number The significant has into extremely especially been And fundraising these. on never and our

that happy questions we I any have in deal of goals have. great unchanged, ability that long-term take achieve to XXXX with and a Craig are have And confidence and Scott, we that, Our articulated for that. to are you our

Instructions]. [Operator

is Sachs. from Blostein with Alex first Our Goldman question

Apologies for two kind they're but putter, promise related. of

private So equity. just starting with

growth are are slower, up obviously meaningfully widening. pretty costs financing So credit spreads

as and So capital, deployment I are to a what deploy where specifically, could but about still offset are done in then return I quick high deploy in curious XX% private fees to enough the the today varies years higher the on the growth IRRs. how well costs. lower you the ago? I as just couple money words, teen next you're And multiples both versus guess equity hear financing a to you could optimism thinking have follow-up equity In multiples, lower growth of of for how management And XX headwinds entry months. underwriting the profile to had you the private to XX other

for of very a Alex, One, thank public market obviously do we deployment. down just I multiple come valuations Why have partner. the Look, why couple there, on start and don't observations meaningfully. you start? public market

X% an Our across equities, and as work asset is the X of in That's macro are look Japanese a this at same just precious, team XX-year quarter point classes noted. obviously average where markets and their does of you example, as example. every time, remarkable look they pretty statistic. a current valuations That's versus a capital And at at long-term very and breadth average.

again, expect I think you down. and relevant. our terms of together being is of ways a So which have more And deployment down, of was be for tools dramatically COVID shut thing coming lots I combination very in in dislocated even at during to period us. with markets our the finding capital dramatically history great more disposal arguably we precious remember a

broadly. of I in and we I'd and the had about great financing it connectivity this we deploying during a that able the have private feel and were in thought firm to equity of distress. as And XX the just the people and business look, is, capital markets relates make to private final that in market capital business the globally guess opportunities we terms as we think markets that of find volatility periods our increases value strategic I

and as real And our I we advantage finance capital here of given the markets to position, our finance of competitive think for we transactions, as the on as think talent being to our basis, to a distress access actually during it ability something so us. that is a ability best-in-class global relates periods have

Alex, Scott. it's

Just Craig to on add a couple what said. things of I'd

I'd multiples, are as costs the paying make it. doesn't on own place, Financing kind the costs you've financing and right. than speaking, in more you're financing little impact the got returns You're you the up. while down are to able if large say generally as an out right thematic up. you company run get the more to that you assets, look right over bit better time a are math, long and And have of

line were mix. of the to are we is before. a we the It's So IRRs bottom bit where still a different just pricing

relates adjacent products switching also as is But fees you in are question phase. Obviously, growth as we of couple our private core to to to about capital across last and Alex, that of onset done is we our excited management XX continue private then, committed as as And over flagships, number that And their fund. deployed that to at fees that to your it management scaling of know, the a the raise a equity capital months. got equity big XX from the business a remember generates opposed business we're here.

you deploy And so and as growth should capital some we see as core there private natural continue equity, to well.

it we'll some fees And in of reraise in to over our strategies. the future, relates at there our then growth So flagship the management coming a equity constructive point have quarters. as private we're obviously,

of with comes Our next question from Siegenthaler Craig Bank America.

assets, do Atlantic. slow strong then economic pickup a currently? or year lot, but I XQ. in expect have And metrics the Global OTTI. credit trended see year least an we does off inside very, at U.S. you to if quality very wanted coming off you seen non-accruals, to know if early on in have OTTI stage base does levels, delinquencies, GA it's is criticized economy very my next low a So And how of enter next question in recession a of the a pickup see

thanks Great. question. Craig, the for

we you I of feel is answer across NAIC forward that any that nature. positioned. Atlantic. not are credit or we how NAIC note sensitivities, of assets, as as look so in their that seen with you So and different rated quality short investment-grade percent good And deterioration XX-plus them is the look X really would at that Global book X, have of

feel we the really so Atlantic. at And the good book strength of about underlying Global

next comes question Our Jefferies. from O'Hara Gerry with

also Just guess, on of recent the I some update any perhaps there. an And of retail commentary some kind the in expansion quarters. of circling Hoping the platform comments in quarter could just we around would democratized of some for be the kind flows around helpful. get back, made distribution of products.

you in terribly Craig. we're We it's your Gerry, why versus volatility I'm guess the surprised quarter the to asked First, raise by start? specific glad don't I slow did question not new quarter. just I really QX see capital about in flows. with on that.

So about $XXX of would democratized that. capital KREST in new have our half been about the was quarter, across million all of raise products and

there's a on tell lot. under that's you that is what Now going doesn't quite hood the all because

U.S. think main in to just wire it I there Crest as first, the distribution, houses are and relates X

share end our the months the in and we know, those there. and on since second and with then our X at positioning right warehouse market of we've were ago launched August added on very We September. to of third you really we're launched As XX pleased a been

our all quarter. these timing increased in the that the distribution numbers, our seeing impact of X and the certainly in but you're the breadth not really of the quarter to with there XX volatility the of in So launches,

make Second, may products. we you on filings, a series have as did seen of infrastructure our

rules, the lot that wanted noteworthy. here can private not detail something we of SEC's placement a we unfortunately, on statement I registration as an but active Now highlight have that to give because there file, isn't you of additional

build fourth, we Third, in the and this opportunity continue equity well to team additional that's hire made we additional on products have the as quarter. us. private focused filings for And credit on and onboard as

be and is one, the enormous main and real priority us, step credit. estate, against of it opportunity. news for to think really is feel market. infrastructure, to positioned private just if huge kind we're you have we wonderfully if asset products classes, a this well will, it's us, a X democratized opportunity. I XX-day It's This were a expect period, great equity from across real And many and ways, massive takeaways, to our main continues upside you back all for the the end us, in like continues this for to

terms I very to our XXXX. Scott, thing would only in shared we of We continue about that wealth Rob as The growth it's you mentioned what those had add, private on great Gerry, Yes. we little numbers. feel with plans through in

our in provide to front point, So with amongst trajectory Craig's will And calls. we at us and other upside of today. this what's in hopefully, you all it is quarterly to relative Day firm upside the to for us Analyst shared the

is question with Davitt Patrick next Research. Our Autonomous with

give cash you next next update for an on few step any difficulty done? not the updated into And over more closed deals thoughts back, announced a year to getting the for taking and flow decrease [indiscernible] down then given broader potential realizations on come maybe realized quarters the but Can us XQ? the

have feel thanks have expect we or million the that for on or approximately performance investment and we transactions of happened this we have question. we deals revenue up Sure. closed that been to we've have good that that expect revenue Patrick, got close realized or Based about. quarter, where realized signed either $XXX

range. numbers, this at investment carried income is from comp fees ballpark lower those So monetization balance in environment. incentive comes come if important, around we spite and will and price XX% realized interest and on continued in momentum the the that of the And that front achieve from

straight future, In I've of is is by environment. quarter-to-date. impacted said And volatility is of of where revenue of an don't and this balance so we've and need going to a embedded portfolio. least higher to on some a course, realized revenue or this have be flow-through monetization industry we sits down before, as respect on approximately time markets as the monetization got sheet the pockets we we across be the our some of need when periods line in is up what at volatility outline down taken our of time well And while our you're right, marks still to firm, that able billion as as balance sheet. and monetize we've interest item carried $X where

And so that's revenue assets to pockets visibility the get cost our the of a bit terms those generating able do future portfolio. fair be value opportunities their to to good we in monetize of of us in relative those gives or that meaningful when

is question with Bill Suisse. next Our Credit Katz from

maybe back the to insurance So platform. circling

Just implications wondering bit it relates to lapse interest of little the of block talk rates about or any if surrender a could you higher kind and/or as dynamics opportunities.

couple better, individual reasons, should Bill, Rob. net think we GA rising punchline I'll be end. on for surrenders this the of flows the of a as of I'll rate on I'll at that business. be or a institutional the should side take the beneficiary and both a is Overall, on start. well it's as One, environment touch

our in pipeline losses because lower on it's annuity. are going equal, a and individual you a than able I a reinsurance higher side, all X.X% to is this things in clients referenced institutional benefit just We're seeing environment. rate realize think then And distribute should We easier to our on side, X% blocks. be to the annuity sell the here. it

think seeing pipeline I why up that's side. the on And our so pick you're block

specifically, it as to As the pretty sheet at assets liabilities you know. and GA, tightly relates balance are matched

have definitely floating expect some we much here, but exposure. don't we So impact do rate

surrendering should in a QX they course. surrenders But sheet policyholders lower in expecting. we end. this XXXX, mentioned far rate incentivize so we part It's be in If And so of before attribute is we've still at well the on products, better which the surrenders were design you are we overall, then of early, of as expected as so. XXXX, balance higher experienced And environment. to doing to of what a from our good do than the

the about surrender we our like design but and kind that of charges kind we environment have And risk a of course, or rising this our a you policies, we is, able think of XX% that we net feel But so to aren't policies something get product rate a but back punchline that Atlantic of a as of should right got and to surrendered GA rising in either in beneficiary. why be in watch. Global we're be think continue type rate arms to environment. around now, those

Bank. Brian from is question next Bedell Our Deutsche with

the and your My fund a being XQ. if then rising $X asset on imagine term, still only unpack question given component that of one plan view also fundraising I of the so of fundraising long-term from channel challenging rates. near year. the second then on And it's on is the on that X/X pension that that fundraising, best so just could appetite comment the sort year-to-date for $XX comment least. environment billion at can Can you tables the within about the real get in or you that And billion segment. far

that with expecting So of the exceed which, be course, want not XXXX, I sure flagships. just a you're to to record was fundraising year

Brian, it's clear, market we has of your market volatility, think And Craig. become start be here. to feel the Why last don't fundraising about Look, of body tone I the I start. challenging. more the I'll work first. great But point on with

estimates our the were that billion to the mentioned flagships for billion in for consensus lot billion, the X months back I X in $XX year months, history market. full in that $XX a of for where beginning raise the the as new number us for ago, year, $XX second without XXXX capital a range. noted of of to as And So fundraising think when was already this you and second through again, year first at for Rob most active

another So environment, difficult of we've still the a was again, quarter been to year. at to already raised got accomplished capital that's the what relative and fundraising in and more go. expected more outset we

that in think, feel other So the great assets we've the couple fundraising us thoughts. accomplished real that a for in infrastructure, mentioned everything we activity I of credit. had think look, estate about and you One, when I of of And areas. again, we've strategy like real some

X So participate or rate we've our of months. should real terms trailing in ago. In protected. strategies strategies we also half or great X/X That's of over months, I then to rising the example. assets, XX of were a that that one the in inflation is a XX been contributors the the innovation, over again, those finally, capital that raised And can didn't in capital years of taking -- in quarter think trailing environment within our raised the exist

takeaway, great performance. of the Asia of series, generation our That fund the the infrastructure our this. feel that would to we had real I quarter. far so a And we example contribution year. which The But was have was It feel mandate fund. handful one real So the of you our real first largest Again, again, contributors flagship think the GA's as relates it infrastructure main would component. have within a then And of about the strategy great in great assets the we've is footprint. been done about certainly components. everything of piece within this largest of outside that to estate, really included estate

an anything if their yield. a bearings to pension market thing the to plan are only some where But doubt add, there's plans U.S. element getting point, conversations going pension or go. question, figure now would right Craig's lot The trying out is productive that's in to of very Brian, inflation to got Yes. having no around protection I we're your

a good dialogues those may and of before. we're active year than with getting We're some spending their of infrastructure, are be of never end institutions with next with remember, So those within this that having of still spent of fronts part But real even we've early bearings time lot credit, lot more time estate. a year. the on

the environment. trying to out are figure globally companies insurance So navigate to how rate

worth funds entirely net high do Sovereign family different and as wealth have dynamic offices investors. a

And over I referenced think broader the question, more fortunate. what we've incredibly macro year. had to we introducing point, billion having we're raised you bigger So in markets the and your last dialogue ever the about doing. in We before $XXX this we're were than and

the have over couple the market the of flagships large years recent more challenged before Our last been more in markets.

that's more like time more got So to capital billion to and we need have to tends Public In the lucky private less bit $XXX have are our dry work. timing, markets with an like still environment powder this. at is we a we find And competition really difficult. a put M&A Corporate capital. of companies challenged. why this,

Companies it. work. lot to So we've need still to put got a of capital

is question next Arnaud with with BNP. Our Giblat

is question and deployment capital infrastructure. My regarding

align there on You just out been private us the in second see a equity. players just deploying the opportunity set I'm wondering as a specifically other how you infra frame I'm quite experienced may the broadly of on you thinking time past quick. hopefully quite by And of give update deployment environment infrastructure? outlook be macro terms front? sum have where an wondering key could for should in similar the if in and in unaffected we in you

there in a main need, don't seeing why I the is that capital infrastructure step start? footprint of change need for the function on globally. And massive of a Craig, massive really our business. point, Yes, alongside you're Look,

whether fund $XX our million. AUM and Asian that's billion, years at today, we're fund diversified for was series, Global $XX X for series, core So and ago

seeing alongside over billion of number the little $X similarly presence, XXXX, step infrastructure. function So teams that the was billion. within of in KKR. among capital invested over $XX increase that a that in XX busiest of In terms you're globally our remained months We've deployment last a and

think seen a see should in activity, continue that for to that expect you've that's ramp we'd again, I us. big something you that and So

it deployments largest was a of the quarter renewables was a in in a -- our of One business. take private French

We I in private have the And in close take true Infra something for to also take also another with worth private us. private It's actually is take level of announced in dynamic activity on that's is broadly. think fifth just year But again, set a is scheduled We've on mentioning. more that QX. high this we've QX. It's a infrastructure. takeaway true close to announced or the is main closed for again

punchline consistent I'd it's comment. say Arnaud, your the is with Yes, Scott.

value-add and infrastructure. strong core across pipeline Our is both

pipeline. So we've deals to been and full continue a announcing have we

is question from Morgan Stanley. Michael Our next Cyprys with

up. about realizations revenue there expanding was talk Rob, if like It hiring? investments with continuing then to strong as just cleanup you well. transactional how you real as quarter. you the a Maybe you for continues theme you capacity bit pretty to in come looking the the on just about mention over real question and year in sort Can the Can also the talk expand asset And are sheet as Where you're your little side next that a in looks balance the there. quarter where benefit invest platform real the the could you asset deployment just added to assets? off of look the are out or

with start to realizations? want You

About sheet. little Sure, million off in bit that's and of million the so the the monetization, of question. north quarter, $XXX Mike, $XXX a balance deployment thanks for of

statistic billion the think don't look the first Why and in real your at you naturally, ago, of these of that we a growth Look, end quarter. Two part, start was of runs $XXX income that. had businesses, on years assets evolution I help I'll the presence at marketplace, XX. the of then in statement. through number Scott And I in to frame your AUM CapEx kind the if let the the

other raise can those grow, then relevant. both you looking people, to well capital. opportunities you to expand areas world-class bring funds your where to the on then as right you where And themselves opportunity into need to and so see build earn be you're to you to And hire have scale talent as

providers the us see the great opportunity made, feel we of the in that our or look think I leading the we I aren't about set where and hockey we've as but off already of those opportunity us there's and in to begun growth you've grow to of a to that see. it and just feels some tremendous continue of all like the are scale for air progress sticks X build think ahead So and businesses, X

Yes.

of Mike. thoughts, Just other a the question. Thanks for couple

the pieces is Just Real take of estate, a take in turn. Asia. we'll out. I'd call estate, things few X assets real One real

continue expand the team. We to

acquisition in platform Japan we now KJRM. that of completed the saw the You called

focused XXX platform world, the now is what Tokyo largest second as a in market J-REIT the on real in have a people estate and reminder. We that's

one plus. thing to I'd call out. We expanded an would platform. So started Asia the core also also now We've be opportunistic, expanded but we've

And Asia across so capital Europe we're core plus. raising and U.S.,

area So that be out. would a I'd second call

attractive more be all financing and those platform, think have billion in reminder, remain strong a themes. in credit. opportunistic credit the now, of estate real is thematic $XX way credit. top Right on as pipeline become traditional of That seeing all markets is very now we similar challenged the as We're and opportunity would format. we return we call to the infrastructure, raising the build do Third estate very across a funds continuing out excess and capital that's I'd again, approaching highly regular of set where AUM, teams. we're Asia. real In

Asia there platform quite the Our of frankly, we meaningfully but and it a and and see standpoint, fundraising on lot referenced has opportunity Rob from ground less that infrastructure a scaled platform. quickly. continue competition, to

way. I'd on private, area of I Europe of earlier value the moving core also in a a particular are front. say take that from just a transition be into about bigger and There's discussion out add lot of the opportunity out. infrastructure and in our some renewable per and building lot energy lately another We the And business called would core activity

comes next Rufus Hone Markets. Our Capital BMO question with from

your I take fee-related on normalized more democratized two Real fairly bit we how increase or Can a and around get about this of item performance view trajectory detail revenues and thoughts and about some think of us year was the at the growth big the business. Assets investment performance of give line growth quarter a from products? might you to a hoping of you that looking a perhaps if the

Yes, at end. Rufus, you it the on hit there

As in more open-ended that is P&., more yield we our driven by and that -- vehicles nature. think about largely be going that in line perpetual our based item are to

on conviction of As up things, a heard lot a behalf X view and item that of of years, continue client of see over you look that real in on you part time. this a quarters can call, we already we that a our as got times have our over perform would to that those line base going you to and conviction combine that couple you're lot the coming of as we We've ramp have business. scale

[Operator Instructions].

Oppenheimer Company. with Our next question is Kotowski from & Chris

you guess thoughts I financing got us wonder I if has Twitter markets. European give Yes. done approval. the Tenneco could your on

for have pursue And that, general? in a obstacle to if through. talk do an to that bit going much the I'm in So kind you be that in the some financing wondering of think transactions perhaps to is is banks long can an are, do work public public And how for inventory you how obstacle fact, to you markets? about privates

as certainly become markets to a and look Chris, months an it it's ago start? honestly, mentioned at we year relative and earlier. financing don't that, ago. Craig, X Look, we the again, why more have But opportunity I challenging, us, for

of XXXX, in you to find very we able were very dislocated to back lots to capital If ways creatively environments. go deploy

all you've or of the was can And and that syndicated impacts So I'm of thoughts level view banks, But how are financial seen QX global on since what the financing the markets. et the sense markets that the to its That gives a at more lowest you points at challenging crisis. lot market in things become that of a dislocated in you trying and when statistics. and how broad cetera. see in not your broadly of minimize syndicated means broadly

the think relates we very, credit. a private obviously, I is it at in And and look side to currently, flip there very to constructive. that Now credit environment are private coin, we as

interesting capital. So really when a That's syndicated markets us. mentioned still opportunity need are earlier, as companies challenged. And Scott for

are at lender. the around new companies down And has volumes be like higher, lending referenced, and this we're time. to transactions And even reward us opportunity risk is attractive feels are deals higher. our in are So but uncertainty, half to of traditionally these to protections base rates incumbent in higher, moment in for The like and come the where feels percentage be direct from markets you historically, like very better. us is our are there's spreads going in where new just business that not only ones it the deployment going that

you look number if more about would that XX%. So recently, be at

I again, on broadly. coin, of top So two of the think are that sides there

Chris, Scott. Yes, it's

Just things. a the obstacle. I word use other couple of One,

it's first, to think important I think understand, opportunity us. real it's a for we

more mezz. I'd seeing going dramatically point, real to be So interesting even credit we a few point to We are we interesting also ago. deployment, than for is credit private months opportunity to a risk Craig's really saw think deployment, reward this estate mezzanine.

credit attractive over-equitized New this you've high-yield transactions XXs. to and more a be there. of tend the type to in market sponsors environment fundraising. reward returns Opportunistic particular, be risk X-year Every in got tend in below the with trades XX%, high the time

to the with so private having on to investors traded dialogue are who the pivot in into around world side. productive markets And looking really credit all the the addition we're side leveraged

investors, built our capital we capital dock place sitting own can so part It's of and You're firm right, reason have new the we markets of the to to directly deals can business, are structures. that middle finance. harder the in the that team we debt

lean bit deals capital on credit maybe more a But environment, in to the this private portable structures. market some done. we're finding may ways You get

large firm ourselves finding credit here that So I represents we're across of environment for about think our part incredibly platforms. opportunity today, as this we a the enthusiastic sit the

I Craig no It would questions there over comments. appears for are now floor at further time. the this to turn Larson that to back closing like

next to your much. KKR, connecting you in and like just we quarter. look for forward We'd Thank interest to so thank time everybody and

concludes teleconference. today's This

time. at your participation. this your disconnect for lines may you You Thank