The median private credit fund management fee during a fund's investment period was 1.25% last year, according to a recently released Callan Institute study. The fee climbed in 2021 and 2022 after falling to 1% in 2020 due to fundraising challenges from the onset of the COVID-19 pandemic, according to Callan.
Private credit fund management fees increase
Direct lending, which typically has larger assets under management, had a 1% median management fee from 2016 through 2022. Real assets credit and niche funds also had 1% median fees due to their newness and desire to attract more money. Opportunistic, multistrategy, and asset-based lending funds had 1.5% fees, and distressed credit had a 1.63% median management fee. These funds implement complex strategies and tend to generate higher returns.
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