Blue Owl Capital Inc.

Q1 2023 Earnings Conference Call


spk01: Hello, good morning, and welcome to the Blue Owl Capital's first quarter 2023 earnings call. During the presentation, your lines will remain on a listen-only mode. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star followed by the number one, and we advise that To all parties, this conference is being recorded. I would now like to turn the call over to Ann Dye, Head of Investor Relations for Blue Owl.
spk04: Thanks, Operator, and good morning to everyone.
spk00: Joining me today are Doug Ostrover, our Chief Executive Officer, Mark Lipschultz and Michael Lease, our Co-Presidents, and Alan Kirschenbaum, our Chief Financial Officer. I'd like to remind our listeners that remarks made during the call may contain forward-looking statements which are not a guarantee of future performance or results and involve a number of risks and uncertainties that are outside the company's control. Actual results may differ materially from those in forward-looking statements as a result of a number of factors, including those described from time to time in Blue Owl Capital's filings with the Securities and Exchange Commission. The company assumes no obligation to update any forward-looking statements. We'd also like to remind everyone that we'll refer to non-GAAP measures on the call, which are reconciled to GAAP figures in our earnings presentation, available on the Investor Resources section of our website at Please note that nothing on this call constitutes an offer to sell or a solicitation of an offer to purchase an interest in any Blue Owl Fund. This morning, we issued our financial results for the first quarter of 2023, reporting fee-related earnings, or FRE, of $0.16 per share, and Distributable Earnings, or DE, of 15 cents per share. We declared a dividend of 14 cents per share for the first quarter, payable on May 31st to holders of record as of May 19th. During the call today, we'll be referring to the earnings presentation, which we posted to our website this morning, so please have that on hand to follow along. With that, I'd like to turn the call over to Doug.
spk12: Thank you, Anne, and good morning, everyone. Today, we reported another strong quarter of results for Blue Owl, demonstrating the strength and resiliency of our business model in the midst of volatile market conditions. Over the past year, a year marked by substantial interest rate hikes, persistently high inflation, and considerable swings in the public markets, we have achieved over 40% growth on the key metrics we use to evaluate our business, including management fees, FRE, and DE, all while maintaining an industry-leading 60% FRE margin. And we feel like we're just getting started. The past couple of months have demonstrated the value of having durable, permanent capital, which means we are never a forced seller in precarious markets. and which allows us to deploy incremental capital into some of the most attractive opportunities we've seen in some time. We believe our focus on downside protected income generating strategies resonates more than ever against the backdrop of a more unpredictable near-term environment. And we are hearing this sentiment echoed in our conversations with existing and prospective investors. Since January 1st, 2022, we have raised approximately $29 billion of fee-paying capital across equity and debt, which compares to our fee-paying AUM of $61 billion at the end of 2021, almost 50% growth. All three of our verticals have contributed to this growth, and we have seen roughly equal inflows. from our institutional and private wealth clients. This is very strong organic growth on an absolute basis. And when you consider the more difficult fundraising environment that we've been in for the last year, we're incredibly proud of what we've accomplished thus far. Importantly, we also continue to see very modest redemption requests from the small percentage of our products which offer a quarterly redemption feature with just $248 million requested in the first quarter or less than 1% of AUM in those products during a period marked by heightened market volatility and investor uncertainty. This compares to over $1 billion raised in those same products. So we remain solidly in net inflow status. From a deployment perspective, More tumultuous markets can result in temporary slowdowns in transaction volumes as buyers, sellers, and intermediaries pause to take stock of the market landscape, as we've seen on numerous occasions over the past year. We think these are exactly the types of markets that further accelerate the value proposition for and the adoption of the solutions that we offer across direct lending, GP solutions, and triple net lease real estate. We saw this play out during COVID and we're seeing it now. While sponsors have been deploying capital at a slower pace in recent quarters, they have turned to the direct lending market in greater fashion for the deals they are announcing. Our GP solution business has continued to offer valuable capital to the growing upper middle market GP community And with our $13 billion Fund 5 fully raised and already 70% committed, we will be looking ahead to Fund 6 in short order. And for our real estate business, the current interest rate environment has made it even more attractive for companies to consider a net lease solution for their capital needs. We are pleased with the $1.5 billion we raised in real estate in the first quarter and the over $4 billion raised in the last six months, particularly given the market environment. So what you're hearing from us is that our playbook remains unchanged, despite the many things changing around us. We're focused on raising long-duration and mostly permanent capital from institutional and private wealth clients, both of whom continue to grow their allocations to alternatives. We are putting that capital to work with the same selectivity and rigorous underwriting standards we've always utilized, and we continue to innovate through new product development while carefully evaluating the many inorganic opportunities that present themselves. We're very pleased with the growth that we've been able to deliver for shareholders thus far. Blue Owl's significant permanent capital base is a foundational and intentional differentiator for us, creating a stable base off of which to grow. And our management fee-centric earnings position us well to deliver steady progress against various market backdrops without the substantial volatility that our peers have from carried interest. Our growth has been outsized relative to peers, other financial companies, and broader market indices. And with our newly fixed annual dividend of 56 cents per share for 2023, we are offering an attractive dividend yield of roughly 5% and expect to continue to grow that dividend meaningfully in the coming years. With that, I'd like to turn the call over to Mark to give you an update on our direct lending and real estate business. Mark. Great. Thanks, Doug.
spk11: During the first quarter, the market trends that we observed in the last few quarters continued and accelerated. Capital scarcity seemed to reach new heights, and Blue Owl continued to act as an integral liquidity provider to sponsors and companies. Over the last 12 months, Blue Owl's direct lending business has originated nearly $19 billion of loans, providing crucial financing to the M&A market. We continue to see sizable deals come to the direct lending market, a reflection of the pause seen in liquid credit markets, and an acknowledgement of the value of private credit solutions during more uncertain times. As we've highlighted in the past quarters, this remains an excellent environment in which to deploy capital at wider spreads and lower loan-to-values than a year ago, financing large and very high-quality companies. And the loans we are making are backed by sticky, stable, permanent capital. As expected, broader market M&A volumes remain slow in the first quarter of 2023. And while our deployment activity is certainly not immune to that trend, we continue to see direct lenders capture significant market share. Credit quality remains strong. Despite a more challenging backdrop, we continue to see good revenue and EBITDA growth year over year on average in the portfolio. Weighted average loan to values remain in the low 40s across our direct lending portfolio. and in the low 30s across our tech portfolio. Across the $75 billion of loans we've originated since inception, annualized realized losses have been approximately six basis points, and those have been fully offset by realized gains over that period. And with regards to performance, the direct lending portfolio achieved gross appreciation of 4.6% for the first quarter and 13.2% for the last 12 months. Now, moving on to real estate, we continue to see high levels of interest in our net lease strategy with corporate borrowing costs elevated and financing markets stalled. Our pipeline of opportunities remains robust with roughly $3.3 billion of transaction volume under letter of intent or contract to close and a near-term pipeline of about $30.8 billion of potential volume. Inclusive of announced acquisition activity, we have invested or committed nearly all of the equity in our fifth closed-end fund, and have started deploying capital out of our sixth vintage. The stability and quality of the income generated by our triple net lease strategy continues to resonate strongly with investors. Inflation concerns are minimized as all property expenses are borne by the tenant, while growth concerns are mitigated by contractual rent escalators over very long 10 year plus duration lease terms. Our tenants are primarily large brand name firms with investment grade credit profiles, And the real estate that we own in this strategy is generally in logistics properties or what we call mission-critical retail, the physical footprints that these businesses need to conduct their everyday operations. While we understand there is more investor caution around real estate as an asset class these days, we think our real estate business is exactly where you'd want to be positioned for this environment. Downside protected through income generation, purchase price, contractual lease duration, and the credit quality of our tenants. and the triple net lease structure. With regards to performance, we achieved gross appreciation across our real estate portfolio of 4.4% for the first quarter and 19.1% for the last 12 months. In our view, great risk-adjusted returns for the strong underlying credit profile of these portfolios. Referencing back to my opening comments today, we continue to see a very constructive environment for our direct lending and real estate businesses. with attractive opportunities to put capital to work and strong interest in the strategies that we offer. The market shocks of the past couple of quarters have reminded people that when markets shift, they can shift very rapidly. Being senior in the capital structure, generating meaningful returns or income, and having your investments supported by permanent and long duration capital are all very good things for our investors and very good things for Blue Olive. With that, let me turn it to Michael to discuss GP Capital Solutions.
spk10: Thank you, Mark. Our GP Capital Solutions business was active in the first quarter of 2023, moving dialogue forward on potential investments and working with many partner managers as they continue to expand and diversify their businesses. Despite what has broadly been characterized as a more challenging fundraising environment, our focus on the largest firms within the alternatives universe has positioned our platform well to capture the ongoing secular tailwinds towards alternatives. We continue to see the market share of the largest managers expand, and this phenomenon seems to accelerate during times of market volatility. In the past couple years, megafunds of a billion dollars or more in the private capital industry have accounted for 65% of the capital raised. Looking at 2022, this concentration is more like 70% to 75%, a clear indicator of the value of having scale and a strong brand. We think our partner managers have certainly benefited from this dynamic, with most achieving or exceeding their fundraising targets despite greater near-term headwinds. Total invested commitments for Dial 5, including agreements in principle, remain around $9 billion of capital committed, or roughly 70% of the fund. The forward pipeline is robust, and we continue to evaluate numerous opportunities that are quite attractive. Performance across Dial funds remains strong, with a net IRR of 23.1% for Fund 3, 50.2% for Fund 4, and 31.9% for Fund 5, all of which compare favorably to the median returns for private equity funds of the same vintages. We held a close for our professional sports minority investment strategy during the first quarter, bringing commitments for that strategy to over $500 million. Looking ahead, we're excited about what the next year holds for the GP Capital Solutions business. We continue to expand the breadth of our potential investor base institutionally and in the wealth channel, and still anticipate launching conversations for Fund 6 later this year. With that, I'll turn things over to Alan to discuss our financial results.
spk07: Thank you, Michael. Good morning, everyone. I'm going to start off by walking through the numbers for this quarter and the last 12 months, and then I'll touch on a few other items I want to cover today. I'll be making references to pages in our earnings presentation, so please feel free to have that available to follow along. To start off, we are pleased to report that since we have been a public company for two years, This is the first quarter we can report LTM comparisons, which are reflected in our earnings presentation. As you know, we report quarterly, but we really run our business with a two- to five-year view and LTM info and not just quarterly results. It provides a more fulsome picture of the progress we've made across our business. So some key highlights of our results through March 31st include total revenues up 44%, FRE up 40%, DE up 41%, and our dividend is up 35%, all on an LTM basis versus a year ago. So in the midst of this market turbulence, we continue to post solid results, which supports what we've been saying for the past two years. We built our business with a foundation of permanent capital and steady, predictable management fee cash flows. We don't have lumpy, volatile, carried interest revenues flowing through our P&L, so our business model and growth profile look different than our peers and this will continue to differentiate us in the diversified alt industry to put some numbers to this for the past two years our peers had on average 30 to 35 percent of their total asset management revenues come from lumpy volatile carried interest cash flows again just very different models than ours okay to step through our results through march 31st in more detail Management fees are up $483 million, or 55%, for the LTM period versus a year ago. Broken down by strategy, direct lending management fees are up $242 million, or 51%. GP Capital Solutions management fees are up $169 million, or 44%. And real estate management fees are up $72 million, or over 400%. But keep in mind, we acquired our real estate business at the end of 2021. This is obviously very considerable growth that we've been able to accomplish. Compensation expense came in in line with our expectations at approximately 27% comp to revenue. G&A expense came in also in line with our expectations at $48 million for the quarter. Placement costs were a little elevated due to a large closing in our ORTF2 BDC. Overall, we are trending in line with our expectations and guidance of G&A expense trending up a little in 2023 from last year. FRE is up $246 million, or 40%, for the LTM period versus a year ago. And we continue to be right on track with our 60% FRE margin guidance for 2023. And we announced a dividend of $0.14 per share for the first quarter. For the LTM period, we have paid $0.50 in dividends versus $0.37 for a year ago period. That results in a 35% increase in our dividend for the LTM period. Now I'd like to spend a moment on our fundraising efforts. We were pleased with our results for the quarter, in particular considering the very challenging fundraising environment we're in. As a reminder, as you can see on slide 12, in the first quarter of 2022, we raised $3.9 billion. And now in the first quarter of 2023, we raised $3.8 billion. And on an LTM comparative basis, We raised $24.7 billion through March 31st versus $11.3 billion for the prior year, an increase of approximately 120%. In one of the toughest fundraising environments that we've seen in some time, we more than doubled our fundraise levels. I'll break down the 1Q23 numbers across our strategies and products. In direct lending, we raised $1.9 billion, $1.2 billion raised in our diversified lending strategy, including almost $600 million raised in our retail distributed core income BDC, ORCIC, and over $700 million raised in our tech lending strategies, including almost $200 million raised in our retail distributed tech lending BDC, ORTIC. In GP Capital Solutions, we raised over $300 million. And in real estate, we raised over $1.5 billion, $1.2 billion in our real estate fund six, which we remain on track with our investor day goals of raising $5 billion for this product, and $300 million for our net lease trust product, our new non-traded REIT. We continue to see strong institutional interest in our products, and the wealth channel rebounded in March from our lows in February, although we expect in certain areas continued pressure on the wealth channel. As we discussed on last quarter's call, as we progress through 2023, we continue to expect fundraising to tilt institutional, although timing is always challenging to predict, in particular in times of market disruption and dislocation. Turning to some of our wealth products, we continue to be very encouraged by the net fundraising levels we continue to see from our products that have quarterly redemption features. As Doug pointed out, we are still seeing strong net positive inflows with these products, with gross inflows running at about five times the level of redemptions. All in all, we've raised approximately $29 billion of fee-paying AUM since Jan 1, 2022. As it relates to our AUM metrics, on slide 11, AUM grew $42.4 billion to $144.4 billion, a 42% increase from the first quarter a year ago. prepaying AUM grew $26 billion to $91.6 billion, a 40% increase from the first quarter a year ago. Both metrics driven primarily by capital raise and deployment and direct lending capital raised in GP Capital Solutions Fund 5, capital raised in Real Estate Fund 6, NLP and NLT, and the addition of our CLO business. Permanent capital grew 28.7 billion to 114.3 billion, a 34% increase from the first quarter a year ago. As a reminder, 93% of our management fees are from these permanent capital vehicles. AUM not yet paying fees was 11.7 billion, including $7.6 billion in direct lending, $1.2 billion in GP capital solutions, and $2.9 billion in real estate. This AUM corresponds to an expected increase in annual management fees totaling over $155 million once deployed, which equates to a fee rate of over 1.3%, which speaks to the quality of the capital raised. In direct lending, we had gross originations of $1.6 billion for the quarter and net funded deployment of 1.3 billion. This brings our gross originations for the last 12 months to 18.8 billion, with 12.2 billion of net funded deployment. So as it relates to the 7.6 billion of AUM not yet paying fees in direct lending, it would take us a little over two quarters to fully deploy this based on our average net funded deployment pace over the last 12 months, although our current deployment pace is a little slower than that. Turning to our balance sheet, we continue to be in a strong capital position. As you can see on slide 17, we currently have a significant amount of liquidity with an average 13-year maturity and low 2.9% cost of borrowing. So summing it all up, another great quarter. Although it is a challenging fundraising environment, we continue to make good progress and grow at industry-leading levels. We have always talked about the importance of our permanent capital in our business model, and this is exactly why. our fee-paying AUM grows more meaningfully versus our peers. As I noted at the beginning of my remarks, this is all a testament to our business model of strong, predictable, high-margin growth. We are very pleased with our results. We delivered strong growth in all of our key metrics. AUM, fee-paying AUM, management fees, FRE, and DE, with each of these metrics up 40% or more year over year. Thank you again to everyone who has joined us on the call today. With that, operator, will we please open the line for questions?
spk01: Awesome. Thank you. And at this time, I would like to remind everyone, in order to ask a question, press star, then the number 1 on your telephone keypad. We will pause for just a moment to compile the Q&A roster. This is Greg. All right, your first question comes from Craig Singlehaller. Your line is now open.
spk06: Hey, good morning, everyone. Hope you're all doing well. I wanted to dig a little deeper into Alan's comments on the institutional channel effort. Which institutional funds are you currently marketing in the credit business? And can you comment on if the fee levels are really any different than your retail offerings as we think about next?
spk12: Hey, Craig, it's Doug. Let me make a couple of comments on fundraising in general, and then I'll get into the funds in the market. So first of all, you've heard from a lot of people, it's definitely a difficult fundraising environment. But from what we're seeing, the secular tailwinds for all, it really hasn't changed. And You know, and I think you'd agree with this one, there's market volatility when we're having bank failures. It certainly makes fundraising more difficult. Our products, and I'll get into those in a moment, have high current income, inflation protection, and obviously downside protection. And when I look at what we've done through 22 and the first quarter of 23, Alan referenced this, we've grown our assets by 40%. And this will start to get to your question, You know, not only have we grown assets, but these are assets that have really attractive fees and very attractive margins. It's not insurance money. It's not CLOs. It's not 10 to 30 basis point money. This is good fees and good carry. So, look, as we sit here today, obviously the spectrum of outcomes a little wider. And I'd say for me, it's a little incrementally. It's a little more difficult to predict the timing of fundraising. But we are seeing significant demand for all of our strategies. We've invested heavily in distribution globally, and we're continuing to invest. The funds have a great track record. And so I can't tell you the exact timing, but we still feel really good about our ability to generate meaningful growth. The big fundraise we have in the market right now is on Oak Street 6. We've raised just under $3 billion. We have a hard cap of five. really good about hitting that cap. We're still in the market with our Tech BDC, Tech 2. I think we just surpassed $4 billion, Alan, and we'll wrap that up. And, you know, I think that's kind of in line with expectations, and we're excited, and I think we'll generate great returns with that capital. And then we have a number of sub-strategies, which I can go through with you, in the credit space. And, of course, there's some SMAs as well. And then I do have to admit, away from institutional, you know, we have three things in the market in private wealth. And, you know, while flows have slowed, we're still doing pretty well in that space as well.
spk01: All right. Your next question comes from the line of Patrick W. Your line is open.
spk04: Patrick, are you there? You might be on mute. Hey, sorry. I'm here. I'm here. Yeah, sorry.
spk08: Can you hear me? Yeah, okay. So I'm sorry if I missed this, but I think you're sticking with a 60% margin, but you still expect you can do $25 billion of gross fundraise and $1 billion of FRE this year, or are you kind of pulling off that a bit?
spk07: Thanks, Patrick. Good morning. It's Alan. We still feel good about being in and around our targets. But let me add a couple thoughts to that. Since we posted these targets a year ago, the world has changed quite a bit, right? This has been one of the most challenging fundraising environments we've seen in a very long time, yet our fundraise is up 120% year over year. So we're still really confident in our outsized growth trajectory. Our retail flows have held up extremely well, despite the environment. And we're really pleased with our results, 40 plus percent year over year growth, in every key metric of our business. There's a lot of hypotheticals that we could kick around. And yes, there's more volatility. And yes, the range of outcomes is wider, as Doug just mentioned, than before. But we feel good about being in and around our targets.
spk03: All right. Thank you. And the next question comes from Bill Katz. Bill, your line is open.
spk09: Hi, this is Cameron Phillips on for Bill Katz. Just wanted to get some further color on the net lease pipeline, just how it's been growing quarter over quarter, year over year, as well as what you see the typical pacing of getting that pipeline completed given the macro environment today. Thank you.
spk11: Sure. You know, look, it's a very, very good, it's a good environment to be a private capital solutions provider writ large. And in triple net lease, you know, I think that dynamic is very, very visible for us. We see it in terms of the number of companies that are engaged, interested, the number of properties, the terms on which we can buy it. I think by any measure, this is a really appealing time to be offering a an alternative solution when you don't have the kind of traditional functioning markets, even less so. We do very well and have done very well for 12 years with highly functional markets around, and when the markets are not functional, that much better. So the pipeline is very strong, and it gets down to one simple observation that comes out of all that, which is, at the end of the day, what we are offering with triple net lease, is a type of credit. It's a type of financing solution, but it's even better because you also own a strategic physical asset underneath it. But with a 15, 20-year lease, with all the expenses paid by the tenant, so from the point of view of the investor, inflation is mitigated. So it's really a wonderful way to make an extremely low vol predictable long-term return. But for the user of the capital, for the company, to get right to your question, if you don't have simple functioning markets, whether that's a bank market, bond market, or otherwise, then it's quite more appealing to say, oh, well, listen, I do have this warehouse. I do have this building we operate out of. I have this manufacturing facility. Why do I need to own the real estate business? I should be able to make a much higher return in my, quote, core business. And so they turn to us, and we're by far the leader in this space, as you know, So we're seeing the benefits of that. And not surprisingly, it's coming up more attractive terms today than it did a year ago. The cap rates that we can buy at are even better. So, yeah, it's a very appealing environment for us. And I'd say also from the point of view of the investors, we have a strategy that is so distinctive from any other real estate strategy out there. We don't own releasing risk. We don't own the uncertainties of the commercial market. We don't run highly leveraged strategies. So it's a good time for this business.
spk01: Perfect. All right, our next question comes from Kenneth Worthington. Your line is open.
spk05: Hi, this is Alex Bernstein stepping in for Ken Worthington. Thanks so much for taking my question. We wanted to double-click on the banking crisis that's been unfolding in the U.S. Do you see a longer-term opportunity for the alternative credit business to supply lending capacity here? And do you see an opportunity for Al, and what would that look like? And maybe as a second part of that question, if you do see such an opportunity, is there any incremental investment or build out that you think that would be required to take advantage of it? Or do you already have everything more or less in place? Thank you.
spk11: Sure. Look, this ongoing, you know, whatever term we ought to apply to it, but this banking transition, I don't know if it's a crisis or not, but it's certainly a meaningful shift in the market. So let me headline with, yes, it presents opportunities for Blue Owl. It presents opportunities for direct lending and private capital solutions in general. So I say that with clear observation. It's not like any of us like to see these things happen. Nobody likes to see, and none of us do, want to see banks that are having to kind of evaporate. These are great businesses that have been built over time, and It's not helpful to the markets in aggregate when you have this kind of capital disruption. But for purposes also, though, being clear on this call, yes, it's a positive for us. I mean, the reality is, and I'll say this at least qualitatively, we know that when you take a lot of capital out of the system, and in fact, the regional banks were some of the only banks left that still actually lent money to companies. That is to say, the large money center banks long ago migrated really out of the balance sheet business into the securities business, into the moving as opposed to storage business. The regional banks actually would still show up and provide capital. And while we did frequently overlap in the same companies, given the scale, the very large scale that we participate in, there certainly was some presence. So qualitatively, it's very clear this is going to mean more demand, or I should say the same demand for capital and fewer suppliers of it. The suppliers that remain, the regional banks that stay in place, it's also apparent that they're going to have a higher cost of capital. And so all of that means more opportunity. The quantitative effects, too early to quantify, is definitively a positive number. As to how positive, I guess it also depends just how much, how many more of these ripples there are through the system. But It has been disruptive, and it's, I think, also amplified for people the power of our model, which is having permanent capital, long-dated capital to meet long-dated needs works. It's good for the economy. It's good for the capital markets. Private markets, through all these times, picture the weekend of SVB. And we were talking about how do we provide capital, make sure that we had capital available, ready to go. And that's been true last weekend with First Republic. We, at the end of the day, are here as a steady provider. So I think the direct lending business has proven to be really a stabilizing force for the market writ large. It's capital, it's opportunity coming our way. I think it is allowing our marketplace to continue to provide something important for the economy. And in terms of what that might all translate into, we've got the infrastructure. So to answer your question specifically, no, we don't need to build infrastructure. This is what we do. We've looked at I think about 8,000 different loans to make the hundreds that we have. So we're fully built. So this is more opportunity. Again, we don't say it gleefully. We don't want to get it this way, but yes, we are a beneficiary.
spk01: All right. Thank you. And again, if you would like to ask a question, press star and the number one on your telephone keypad. Our next question comes from Patrick. Patrick?
spk04: Patrick, are you there?
spk08: Sorry, guys, I'm having trouble with the mute today. Thanks for the follow-up. So on the retail products, is the triple net lease still on only one distributor? If so, could you update us on the timeline for more coming online? And secondly, are there still a lot of big platforms coming online with ORCIC and ORTIC this year? Thank you.
spk12: Yeah, so let me... Let me start on net lease trust. We are on one platform. We've had a lot of success. We thought we'd be on a few more by this time, but it's just taking a little bit longer giving everything that's going on in the markets. I think by in the next six months, we should be on another three to four wire houses. So I'm, You know, I feel pretty good that hopefully we can triple, quadruple the amount of monthly, quarterly fundraising in that product. There's definitely a lot of interest. It's just taking a bit longer. In the other products, we continue to add wirehouses. I think those platforms, those syndicates are largely built for us. And I would predict that NetLease Trust, by the end of the year, will be our single largest syndicate.
spk04: All right, thank you.
spk01: And I do not see any further questions at this time, so I'll turn it back over to the Blue Owl team.
spk12: Well, thank you, everyone. We are really proud of our results this quarter, especially in light of what's been going on in the markets and We're grateful for the support and partnership. I have to add, though, on a personal note, I don't understand how our stock is trading at $10.60. You've heard from the team. Our income streams are very predictable. Our margins are consistent. We've got permanent capital. I would say that our revenue is probably the most predictable of any alternative asset manager. Most importantly, our dividend yield is now 5%, and we've signaled that our dividend will be materially higher next year and the year after. So it feels like to me and the team that this is going to be a very good entry point for investors. Again, I want to thank everyone for the time and look forward to following up in the days ahead. Thank you.
spk01: Thank you. This does conclude today's conference.
spk12: Have a great day.

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