The monetary providers trade has witnessed an growing variety of big-name asset managers attempting to courtroom retail traders. GCM Grosvenor, a world various asset supervisor with $80 billion in AUM, is the newest large identify to enter the fray. The agency has supplied merchandise for ultra-high-net-worth traders/certified purchasers for near 20 years. Now, it has introduced the launch of its first interval fund, which can enable it to focus on non-accredited traders.
GCM Grosvenor has partnered with CION Investments, an funding supervisor with a strong retail distribution channel, to create the CION Grosvenor Infrastructure Fund (CGIF). The fund will spend money on property within the transportation, digital, power, power transition, provide chain and logistics sectors, in addition to infrastructure-adjacent property.
The 2 corporations are utilizing roughly $300 million of seed capital from a significant institutional investor to launch the automobile, coupled with a further money dedication of roughly $80 million. Earlier than beginning distribution, the fund will merge with a portfolio containing $200 million in GCM Grosvenor’s at the moment owned infrastructure property.
Since 2020, the asset supervisor has raised $3.1 billion from particular person traders globally, with 58% of these funds coming from traders in North America. The determine represents roughly 10% of the agency’s total fundraising over that interval. At the moment, in line with Jon Levin, firm president, 5% of GSM Grosvenor’s complete AUM comes from the non-public wealth channel by means of constructions corresponding to commingled funds and separate accounts. Nonetheless, till now, the cash has come primarily from certified purchasers or RIAs investing on behalf of a number of shoppers.
“Now, clearly, by means of this infrastructure fund, we’ll have the flexibility to achieve all varieties of traders,” Levin mentioned. “So, it is a additional step and an extra evolution, nevertheless it’s constructing upon a set of expertise and historical past that’s been in place for a very long time and a significant a part of our enterprise for a very long time. We anticipate it to develop into extra significant over time, which can imply continued funding in new product improvement and continued funding in additional distribution assets to assist us cowl the market appropriately, each by means of partnerships like we’ve got with CION and thru our personal inside capabilities.”
As Levin revealed throughout the agency’s third-quarter earnings name, the following stage of the agency’s progress plan for the non-public wealth channel will deal with launching non-public market interval funds that can be accessible to each accredited and non-accredited traders. The merchandise can be bought by means of RIAs, unbiased dealer/sellers and wirehouses.
Kevin Buchheit, managing director with GCM Grosvenor, famous that interval funds maintain sturdy attraction for particular person traders beneath the certified purchaser degree due to options corresponding to 1099 tax reporting, as much as 5% quarterly liquidity, no accreditation necessities and the flexibility to subscribe every day.
On the identical time, the agency felt that infrastructure was among the best asset lessons to pursue on this new enterprise due to its money yield element, enticing total returns, an inflation safety element and restricted correlation with the broader markets, added Levin.
“And we predict there may be loads of room as a result of it’s a much less mature space of asset administration for extra merchandise to be accessible to traders,” he mentioned. “GCM Grosvenor, with 20 years of expertise in infrastructure, is likely one of the most skilled international gamers within the area. So, we felt the mix of the funding traits themselves, in addition to GCM Grosvenor’s expertise in infrastructure and the partnership with CION, we’re capable of supply it in a product in a wrapper that doesn’t exist to a big diploma available in the market and creates an fascinating alternative throughout.”
Along with CGIF, Grosvenor’s debut within the interval fund area contains serving as an funding companion and core unbiased supervisor for Axxes Non-public Markets Fund (Axxes), a registered interval fund launched by non-public markets funding agency Axxes Capital Inc. in September. Axxes will deal with the non-public fairness area with a portfolio of direct entry co-investments and secondaries.
