Ares private credit fund sees redemptions ease as withdrawal pressure moderates

Withdrawal requests from Ares Management’s flagship private credit fund fell in the third quarter, providing another indication that redemption pressure across the private credit market may be beginning to moderate, according to a report by Reuters.

The report cites a recent regulatory filing as revealing that investors in the $22.7bn Ares Strategic Income Fund (ASIF) sought to withdraw 13.1% of their shares during the latest quarterly tender offer, down from 14.4% in the previous quarter.

As with other non-traded private credit vehicles, ASIF limited redemptions to 5% of shares during the period, leaving a significant portion of requested withdrawals subject to future tender offers.

The latest figures follow similar declines reported this month by BlackRock and Apollo Global Management, suggesting that the surge in redemption requests seen across private credit funds targeting individual investors may be losing some momentum.

Non-traded private credit funds have faced increased withdrawal demands from wealthy individuals in recent months amid concerns over underwriting standards and the ability of heavily indebted software companies to cope with disruption from artificial intelligence.

Asset managers have been working through accumulated redemption requests, with some investors resubmitting portions of their original requests when those withdrawals could not be fulfilled because of the 5% quarterly limits.

ASIF said much of the latest redemption demand came from investors who had already requested withdrawals in earlier quarters. New withdrawal requests, after accounting for those repeat submissions, represented approximately 3% of net asset value.

The fund said investors who initially requested redemptions in the first quarter of 2026 and continued to resubmit amounts that had not been fulfilled in the second and third quarters were expected to have received almost 80% of their original requests.

Provided redemption demand remains around the third-quarter level, ASIF expects to largely clear the remaining outstanding requests by the end of the year.

ASIF Class I shares have delivered an annualised total return of 9.97% since inception, according to the fund, representing a 161-basis-point premium to broadly syndicated bank loans.