Ares Management Corp ARES

Kipp deVeer and Blair Jacobson have been promoted to newly created Co-President positions, effective immediately. In these roles, they will drive firm-wide strategic and operational initiatives, support investor relationships, and develop future leaders. This expansion of the executive management team allows CEO Michael Arougheti to focus on high-impact growth opportunities, including the integration of GCP International, expanding real estate and infrastructure lending, and enhancing insurance capabilities, leveraging the firm's deep bench of 255 partners among 3,200 employees.

Ares operates in vast addressable markets, believing that retail and institutional investors remain meaningfully under-allocated to private assets. The firm anticipates continued inflows to scaled managers and is actively investing in its origination capabilities, having added over 100 investment professionals in 2024. This brings the total to over 1,100 Ares investment professionals across 35+ global offices, enabling the sourcing of thousands of investments across the risk-return spectrum and maintaining long-term performance through cycles.

Despite a more subdued transaction environment in 2024, Ares invested a record $106.7 billion, representing a more than 50% increase over 2023, with Q4 deployment reaching $32 billion. Management is optimistic about a gradual improvement in the overall transaction environment in 2025, driven by significant pent-up demand for PE exits, increased business confidence, and more active financing markets. The firm's diversified strategies and incumbent relationships allow it to be a supportive liquidity provider even if new transaction volumes do not accelerate broadly.

Ares achieved a quarterly record of $28.3 billion in new capital commitments in Q4 and a full-year fundraising record of $92.7 billion in 2024, exceeding its previous annual record by over $15 billion. This momentum was significantly diversified, with nearly 65% of total fundraising coming from outside campaign funds, including 20% from wealth, 16% from institutional SMAs, and 7% from its insurance affiliate, Aspida. This broad base of capital sources is elevating the firm's fundraising floor and providing consistent capital flows.

The wealth channel demonstrated significant growth, with equity inflows tripling year-over-year to over $10 billion in 2024, and total AUM reaching $18 billion including leverage. Ares estimates its market share in this channel increased to nearly 10%. Near-term priorities include expanding existing funds, establishing new strategic partnerships across RIA, family office, and IBD channels, and broadening international distribution. International business was a significant driver, with 36% of capital flows from Europe and Asia in 2024, up from 7% in 2023.

Ares' affiliated insurance platform, Aspida, announced raising over $2.3 billion in equity commitments, with more than 75% from third-party investors. Aspida now has over $20 billion in total assets and aims to reach $50 billion in assets by the end of 2028. In 2024, Aspida's primary fixed annuity volumes nearly doubled to over $3.8 billion, significantly outpacing the industry's 7% growth, and originated over $6 billion in new premiums including reinsurance flows.

The acquisition of GCP International is expected to close in Q1 2025, enhancing Ares' capabilities in real assets for the new economy, particularly in vertically integrated industrial real estate and digital infrastructure. The integration will bring several funds to market, including the fifth vintage of the logistics development fund in Japan, the second U.S. self-storage fund, and new data center development vehicles in Japan and Europe, with anticipated total equity commitments of approximately $4 billion for the data center funds. Management views the data center market as having significant long-term demand, driven by cloud computing and AI, with current development plans focused on high-quality sites in major metropolitan areas.

Ares views banks as crucial partners rather than direct competitors, emphasizing a symbiotic relationship where banks' lending operations and client franchises complement Ares' capital base and origination capabilities. The firm's private credit platform is differentiated by covering the entire spectrum of sizes, sponsors, and non-sponsors, providing a competitive edge. While competition exists in large market unitranches when the syndicated loan market is active, Ares' CLO issuance capability provides a hedge, and its focus on the core middle market offers consistent excess return opportunities.