Swiss alternative asset manager Partners Group on Thursday disclosed a rise in redemption requests across its funds, while Blackstone limited withdrawals at its flagship private credit vehicle, underscoring growing liquidity stress in private markets.
Partners Group said repurchase requests at a $16 billion Delaware-based fund reached 6% of assets held, surpassing the 5% threshold it permits each quarter. Two sources familiar with the matter told Reuters that this breach means withdrawals would be capped. People familiar with the matter also said Partners Group is expected to cap a second large investment pool.
The developments came after Partners Group shares plunged on news it had capped a key fund. The firm, which manages roughly $185 billion, attributed the pressure to industry-wide volatility in open-ended evergreen funds - a strain that began with private credit and has moved into private equity.
Many of the newer unlisted private credit vehicles, often structured as business development companies, operate on an evergreen basis. That structure typically gives investors scheduled windows at set intervals to request redemptions. Virinchi Narayan, managing director of Dubai-based Three Pins Capital Limited, commented that evergreen structures are hard to execute in practice and said the closed-ended format has historically been the better suited approach for these funds. He added that easy-money conditions and investor demand encouraged a shift toward evergreen, redemption-driven structures.
Investor attention has increasingly focused on the loans made by private credit funds run by large asset managers. Market participants are scrutinizing valuations and lending standards and have been questioning how software companies will cope with broader technological challenges. These concerns have contributed to greater caution among clients of evergreen funds.
Signaling continued pressure within private credit, Blackstone reported that redemption requests at its private credit fund rose in the second quarter, prompting the manager to cap withdrawals. Earlier in the quarter, investors in the $79 billion Blackstone Private Credit Fund - known as BCRED - sought to redeem 10% of shares during the second-quarter tender offer, up from 7.9% in the prior quarter. The fund limited withdrawals to 5%, the customary cap for such vehicles.
Blackstone noted that, unlike the previous quarter when the firm and some employees invested to satisfy all requested redemptions, the fund this quarter adhered to its standard 5% limit. In a statement, the fund said its structure reflects a trade-off: investors accept some periodic restrictions on liquidity in exchange for the potential of long-term outperformance.
The ripple effects of the Partners Group announcement were felt across markets. Partners Group said it had also constrained redemptions from an $8.6 billion private equity fund after requests at its Luxembourg-based Partners Group Global Value SICAV reached 9.8% of assets held. Three other mature evergreen funds, with combined assets of about $9.7 billion and mainly backed by institutional investors, were estimated by Partners Group to face redemptions in the range of 3.5% to 5%.
Partners Group added that it expects gross new client demand of $26 billion to $32 billion for 2026, driven by a visible pipeline of fundraising opportunities across mandates, evergreens and traditional closed-ended programs. That projection helped the company's shares recover some ground after they had slumped 16% to a six-year low on Wednesday.
The sharp move in Partners Group shares contributed to declines for European peers on Wednesday, including Sweden’s EQT, CVC Capital Partners and Bridgepoint Group. U.S.-listed asset managers such as Blackstone, KKR, TPG and Ares Management also saw share price falls around the same time. The following day, markets showed some reprieve with shares rising, including a 7% increase in Blackstone.
Context on redemption windows and market reaction
Redemption windows for key U.S. non-traded private credit funds began to close last Friday for the second quarter, and participants in the market have been monitoring the volume of withdrawal requests closely. Cliffwater was the first to report an uptick in redemption activity: requests at its flagship $31.3 billion private credit fund rose to 17% in the second quarter from 14% in the first quarter.
Those figures, alongside the requests seen at Blackstone’s BCRED and at Partners Group funds, offer an early view of how strains originating in private credit lending are spreading through other corners of the private markets. The episode has underscored the tensions inherent in evergreen structures when faced with clustered redemption requests.
Summary
Partners Group and Blackstone have both experienced heightened redemption activity, prompting the capping of withdrawals at major funds. The stresses appear concentrated in evergreen private credit vehicles, with spillover into private equity. Investors are increasingly examining valuations and lending practices as withdrawal pressures mount.