Ares Management Corp. on Wednesday reported $158.4 billion in assets under management as of June 30, up 6.6% from $148.6 billion at the end of the previous quarter and an 11.5% increase from $142.1 billion year-over-year.
Executives at the alternative investment manager attributed the growth in AUM to capital raising in its U.S. and European direct lending; syndicated loans, which includes the first quarter acquisition of collateralized loan obligation manager Crestline Denali Capital, as well as alternative credit and real estate funds. Ares also held a first closing for its sixth flagship corporate private equity fund and a final close in June on another private equity fund, the $3.5 billion Ares Special Opportunities Fund.
The second quarter was one of Ares Management's strongest ever for fundraising, said Michael Arougheti, co-founder, CEO and president, during Wednesday's earnings call. Though Ares executives expect a slow and uneven recovery in coming years, the firm is well-positioned to take advantage of the dynamic environment, Mr. Arougheti said. He added that Ares has about $10 billion of uncalled capital for stressed and distressed investing, as well as traditional private equity.
However, he said that realizations remain slow. Ares is excluding energy investments from its latest private equity funds, but it will be an investment sector in other funds, including its dedicated energy funds.
Credit, Ares' largest business by AUM, had $117.4 billion at the end of the second quarter, a 4.4% increase from $112.5 billion as of March 31 and up 11.3% from $105.5 billion as of June 30, 2019. Private equity AUM was $26.6 billion as of June 30, up 20.9% from $22 billion at the end of the prior quarter and up 7.7% from $24.7 billion year-over-year. Real estate had $14.4 billion in AUM, up 2% from $14.1 billion as of March 31 and a 21% increase from $11.9 billion at the end of the year-earlier quarter.
GAAP net income was $56.4 million for the second quarter.