Good morning, and welcome to Ares Management Corporation's Investor Day. Before the presentation begins, we need to inform you of important matters and legal disclaimers about today's presentation. Today's presentation contains forward-looking statements and results. These statements are not guarantees of future results or financial condition, and are subject to risks and uncertainties. Our actual results may differ materially. Note that Ares does not undertake any duty to update the information presented today. Please see the risk factors in Ares Management Corporation's annual report on Form 10-K and other filings with the Securities and Exchange Commission for details of these risks that could impact results. Viewers should not view the past performance of Ares Management Corporation as a guarantee of future results. We will also refer to non-GAAP measures during today's presentation. Non-GAAP reconciliations to GAAP figures are available in the full presentation, which can be found on the company's investor resources page of its website at aresmgmt.com. Today's presentation does not constitute an offer to sell or a solicitation of an offer to purchase an interest in any Ares fund. Please reference the disclaimer for additional information. We will now start today's presentation with a short video. From our inception more than 25 years ago, Ares Management has thrived by performing through market cycles, supporting outstanding talent, driving robust origination, developing comprehensive investment solutions, and fostering a values-driven culture. Today, we are one of the largest global alternative investment managers. While we are proud of our current positioning and fortunate to operate in markets with significant opportunities and tailwinds, we are committed to further evolving our platform and enhancing our market leadership. Guided by a deep and collaborative bench of talent, we are entrepreneurial, innovative, and highly effective team players. We embrace change, seize opportunity, and pursue highly strategic growth initiatives. We constantly seek to enhance our value proposition to our investors, business partners, employees, and other stakeholders around the globe. The significant breadth of our platform spans asset classes and geographies. We set ourselves apart by harnessing the power of our distinct, yet complementary credit, Real Assets, Private Equity, Secondaries, and other business groups to drive differentiated investment performance and outsized growth. Now, we gather to reflect on our accomplishments of the past and to outline the many opportunities ahead of us. On behalf of our team, we greatly appreciate your commitment and support. Welcome to the Ares Management Investor Day 2024. Good morning, and welcome to the Ares Management 2024 Investor Day. My name is Greg Mason. I'm Co-head of Public Markets Investor Relations. For those of you in the room and for those of you online joining us today, thank you for taking the time. We've got a lot of great content for you today, tightly packed in the next 3.5 hours, plus time for your questions, but I hope to set the stage for some key takeaways for today. You're going to hear from over 25 different presenters. I have the privilege of working with these people. They're smart, hardworking, and genuinely nice people, and I hope you get a sense for what I know is that we have an amazing leadership team that works collaboratively together to drive the entire business forward. We also operate in large addressable markets, where we think each of our business segments has tremendous runway for future growth. In addition, we're going to talk about our business model and how our FRE-rich, asset-light balance sheet generates consistent growth, and we believe has the ability to thrive throughout market cycles. I also hope you hear that not all AUM growth is the same, and our target of $750 billion in total AUM by the end of 2028 is driven by high-quality AUM growth. Then the bottom line takeaway for today is that we expect our realized income to grow at a compound annual growth rate of 20%-25% through 2028, and that our dividend will grow by 20% or more CAGR over the same time frame. Now, just to set the agenda for the day, you can look at the agenda at any time on the mobile app, but this month actually marks our 10-year anniversary as a public company, and so our Executive Chairman, Tony Ressler, is going to kick us off with his perspectives on the last 10 years for Ares, as well as his outlook on the next 10 years for the industry. Then, our CEO, Michael Arougheti, and our CFO, Jarrod Phillips, will come up to give a strategic and financial outlook. Then we'll move to our fundraising, where we'll talk about our institutional and wealth channels, and then we'll bring our entire Credit Group leadership up to highlight the large and diversified credit platform that we have here at Ares. Around 10 A.M., we'll take a 10-minute break. And then we'll come back in, and we'll have a panel on the next frontier of what we believe is exciting growth in private credit. Then we'll move through our remaining businesses of real assets, secondaries, private equity, and our insurance business. And then, Mike, Jarrod, and I will come back up on stage to take your questions. So we've got a lot of great content for you today, and I'm excited to turn the stage over to Tony to kick us off. Thanks, Greg I'm Tony Ressler. I'm Chairman of Ares Management. Delighted to be here. Thank you all for being here. I guess my job is a fairly easy one. I'm supposed to describe the past 10 years of Ares Management in the next five or 10 minutes. I think the best way to start is to make quite clear: No, I did not expect that Ares Management would grow in market value 10 times over the past 10 years. No, I did not think Ares Management would grow its FRE 10 times in the past 10 years. And no, I did not think Ares Management would grow its assets under management 5 or 6 times over the past 10 years. What I did know when we went public is that we were a very good company and had the ability to become a great company. We weren't sure, but we had enormous confidence when we went public that we could do something special. It's tough... I would say, tough to know what was most responsible for the past 10 years and for that somewhat extraordinary performance. I think one might say it was the collaborative culture or the power of the platform that you hear about so often. It certainly could have been the commitment we had to building really an extraordinary origination platform. I think it could also have been the fact that we were utterly committed to credit and understanding credit. I think some of us might argue, 20 years ago, when Kipp and Mitch and Smitty and Mike came to this firm to launch a U.S. direct lending business. My personal favorite was 6 years ago, when we replaced the then CEO with the current CEO, Mike Arougheti. I would say all of the above had a meaningful contribution, and as far as I'm concerned, we're just getting started. You know, we get asked all the time, you know, "What was that secret sauce?" We, we, we try to answer this, but, but to me—Oops! Sorry about that. But to me, assets follow performance, and we've had really good, consistent performance over an extended period of time. We've stayed disciplined to what we do well. That, to me, for an investment firm that's focused on a massive market with extraordinary opportunities, stick to what you do well. Assets follow performance, and if performance is solid, impressive, and long-term, good things will happen. I must also say, in this picture, bringing my son, I still can't figure out why I brought my son. I think he'd just graduated college. But most importantly, I don't think anyone else in our senior management team had a college-age child at that time, so it seems like I was the only one, but I don't know if that's core to today's presentation. I get asked, and I think we have a fairly interesting discussion of what the next 10 years looks like, and for me, it's really pretty straightforward. The private markets will grow faster than traditional markets. Corporate, asset-backed, real estate, infrastructure, all will grow as asset classes in the private markets. The United States, North America, Europe, Asia, all will grow larger in their private markets activities, and we see the bigger guys getting bigger. We see average deal size continuing to grow. So the simple and, to me, obvious perspective is we could not be in a better place. Our next ten years would appear to be actually far more exciting even than our last ten years. And as far as I'm concerned, all of us have so much more to offer at this moment in time. We have so much more expertise. We have so much more credit and lessons learned over the past 10 years as a public company, and I think, as you're about to see, we have such depth in our management team, that we could not be better positioned for this next 10-year run. And now, I, I guess I get to introduce my favorite Chief Executive Officer, Michael Arougheti. Good morning, everybody. Thank you, Tony, for the kind words. I could not be more excited to be here with all of you today. Anniversary is always a great time to reflect on where you are, where you're going, how you got to where you are. So, I'm happy with the coincidence of this day with our 10-year IPO anniversary. Looking at those pictures, it feels like yesterday, but obviously, it was a long time ago. It's always very humbling for me to sit in front of all of you and see all of my partners and friends as well, when we talk about the extraordinary company that we've built together. We have been at this for 25 years. To Tony's point, we have figured a lot out. We've made mistakes, we've learned from them, but we keep pressing forward, and as we sit here today, we have an extraordinary business, and hopefully, you'll get a sense for that and for the people throughout the course of the day. Ares today has $430 billion of assets under management. We have 3,000 employees in 40 offices and 20 companies. We're a truly global platform, and you will see that as we describe each of our businesses, and we have room to continue that global expansion. What sets us apart is that from day one of the founding of the firm, we have been focused on the middle market. We understand the value of being local. We understand the value of building entrenched relationship networks in those markets. We understand the cultural nuances and sensitivities of operating in these markets. But we marry that with a global perspective, a global scale, a global relationship network. Very rare to see a company that can run at that scale with that global perspective, but stay true to its roots. That scale, that scale benefit, we're going to highlight a lot today and talk about. What it also allows us to do is to have foresight into where we think the markets are going, how is capital flowing globally, learn from what we see in a more mature market and export it into a less mature market, but that foresight is always married with local market insight. Take what we see globally and apply it into these local markets. By doing that, we're able to create new product families and new growth engines. We've done that consistently since we started the firm. Part of that is diversifying our strategies, and you can see how our growth is not just accelerating, but it's diversifying at the same time. This diversification obviously smooths our growth, it gives us higher confidence in the trajectory of that growth, and it allows us to open up new markets. You can see as we're getting larger, that growth is accelerating as we diversify, having grown our AUM over 20% in the last five years. Importantly, we have engines for growth that are following behind this, setting us up for the future, and that's reflected here in the number of fund families that we have on the platform in excess of $1 billion. So if you go back to 2014, at the IPO, we had 10 funds on the platform at $1 billion that were poised to scale. That number has tripled to 32 and continues to grow. Importantly, if you view that through another lens, over the last 5 years, we are not being driven by one business at this firm. All of our strategies are growing, everyone is pulling their weight, and you can see how broad-based the growth engine here is. Some of our newer businesses, like secondaries, that have actually grown a little bit, a little bit below trend, as you'll hear today, are coiled for growth into the future. So how do we do this? What's the playbook? When we talk about the business in the halls of Ares, we try to keep it very simple. There's a flywheel that we need to create. We need to be best in class at raising capital. To Tony's point about the value of consistent performance, we need to be best in class at investing capital, and then everything we do on the non-investment side needs to be best in class as well. How do we support our client relationships? How do we support our growth? How do we drive margin efficiency? So that flywheel ultimately is what sustains our growth. As we invest in that flywheel, to Greg's point, we want to be sure that we're not just growing for growth's sake, but that we're growing with a view that size is a huge benefit to our performance, and we want to focus on high-quality growth, high fee, high margin, scalable growth. We're not chasing AUM numbers; we're chasing high-quality FRE. When we think about our journey to get here and the competitive advantages that scale has given us, I break it down into three simple buckets. One is origination. This idea that we have built an origination engine across asset classes in local markets differentiates us. The binding constraint to growth in our markets over time will be the ability to source unique assets for our clients and to be more relevant to more people in more markets than anybody else. So when you look at our footprint in terms of the number of people and the capabilities we have, we have a very significant head start, and we keep investing in that competitive advantage of origination. And what origination also allows us to do is to be extremely selective in what we ultimately invest in, which drives performance. And you'll see, again, not coincidentally, that each of our businesses tends to invest in close to five-- what they see in any given market, saying no 95% of the time. Saying no 95% of the time. So when you're seeing more flow and you're saying yes to only 5%, hopefully, that risk filter improves over time and shows up in performance, which it has. Two, we need to marry that origination capability with scale of capital and flexibility of capital. Both are critical. You can't just be large, and you can't just be nimble. You need to be nimble at scale, and the reason is it improves your origination. We need to be more relevant in our markets. If a good company or a good asset finds its way to Ares, we need to get it on the platform, and we need to keep it here. The way we do that is to broaden out our capability set and the type of capital that we manage. Then lastly, we need to harness, as Tony said, the power of the platform. We need to look across the investment portfolios, the deals we see, the deals we do and don't do, and leverage that insight into the way that we invest money and the way that we manage our portfolios. To put that in perspective, we currently have about 4,500 middle-market investments on the platform. There's only 2,500 traded companies on the New York Stock Exchange, with a heavy concentration in the top 10. Think about that in terms of the insight that we get into local economies, local markets, industries, capital flows that we're then able to leverage into the business on an ongoing basis, putting aside the 95% of deals that we say no to, that also inform the decisions that we're making. So when we get this flywheel moving, again, we're gonna get quality growth, we're gonna get consistent growth, and we're gonna get economies of scale, and you can see that showing up in the financials. Since 2018, over the last five years, we've grown our capital raising by a compound annual growth rate of 16%. The investments we're making in origination are keeping pace. We've increased our deployment at 16%. But here's where it gets exciting. When you look at the leverage in the system, we've been able to grow our realized income 25% and our FRE, 35%. And that performance is beginning to accumulate in our net accrued performance income balance, which is similarly up 30%. So when you put all that into the mix, what comes out is a highly reliable return on Ares Management stock. We've generated a 52% compound annual growth rate in total stock return over the last five years. Juxtapose that against the S&P 500, which generated 17%, so 3x the S&P over the last five years, and a 14% return for the financials index. So I think the market is similarly recognizing the value of the system that we've created. Try to make it simple, but it's not easy, and it's not just about investing in the architecture of the firm. It's about investing in your people. I like it when Greg said that we're genuinely nice people. And that sounds so simple, but how do you build a culture that scales with the business? How do you create a culture where your employees and your partners think about shared success and shared prosperity in a way that others don't, so that you can actually harness these synergies and deal flow, origination and information? And we spend as much time investing in and building our culture than anything else at this firm. And one of the things I love most about these types of days is you all get to see that. You get to see the depth of our team, you get to see the quality of the people, and you get to see the quality of the relationships that exist here. One of the reasons the relationships are so high quality is we've been doing this together for a really long time. My business partners are my best friends. We have built a company together over 30 years that is highly differentiated. The values that got us here, as Tony mentioned, are the same values that drive us into the future, and our culture and our values permeate the fabric of this place, and it gets passed down from generation to generation. You can see here, our EMC has an average tenure at the firm of close to 20 years. Our senior-most professionals have been with the firm close to 10 years. We have very low turnover. That fundamentally ensures that the culture that got us here will continue to thrive and take us forward. That culture is informed by our values. We approach our business with a deep sense of purpose and a deep sense of service, and the reason for that is when you manage money on behalf of the largest institutional wealth clients, insurance clients across the globe, we are not just in the business of generating return. That's table stakes. We have to generate great return, but we have to know who we're generating that return for and why. And when you talk to anybody at Ares, they understand the profound responsibility that people put in us, the responsibility to support people's retirements, workers, teachers, firemen, policemen, annuity holders. People rely on the returns that we generate, and everybody that works at Ares understands who they serve and why we do what we do. One way to think about this architecture that we've built is to understand that the capability set that we've created has established us as a meaningful solutions provider to our investment clients and our portfolio clients. We've created a feedback loop based on the depth of those relationships that informs how we form capital and how we deploy capital. The key, when you're in these local markets, is to understand what that market needs, and if we don't have it, build it. Then when we build it, deliver it in the right package to our clients to give them a differentiated investment outcome. And when you do that well over 25 years, you get a broad-based set of product across the risk-return spectrum, across geographies, to meet the needs of more clients around the globe. And so when we hear from our partners, Raj and Ryan, about what we're building on the distribution side, a lot of the growth opportunity is in our ability to provide broader-based solutions to our clients in more geographies at different costs of capital, and to package them and cross-sell them consistently over time. Tony asked a lot of questions: How did we get here? One really never knows, but I can tell you it was with great effort, but great intentionality.... We were always guided by our values, but we had a system to think about growth, to understand how these markets were developing. And it always starts with understanding the markets that we play in. Where can we differentiate? Where are those competitive advantages and origination and information most valuable? Importantly, when you look at the markets that we play in, these are large, large addressable markets with very fragmented competition. You can go down this list, and you can see each and every one of them, meaningful, meaningful, addressable market, meaningful growth. We have a leadership position in each of these markets, and yet we have a less than 1% market share. I like that setup. We have fragmented competition in large, growing markets with meaningful competitive advantages to scale. Importantly, too, as I showed you our fund families, the growth is broad-based, but when you look at the market backdrop that we're growing into, the growth is similarly broad-based. Each category in the alternative asset space is growing, each geography is growing, but we happen to be over-indexed to the fastest-growing markets and the fastest-growing geographies, private credit, secondaries, and North America. That's not to say that we want to ignore the opportunity set that is emerging in other parts of the world and in other parts of the market, because that is the growth of tomorrow. There are a number of meaningful, meaningful secular trends that are propelling our business forward, that we are acutely aware of, and that we are investing behind, and they will show through today as each of the businesses are talking about their own growth path. But just to name a few, there is a significant transformation occurring in the private credit markets as those markets continue to expand against the backdrop of the growth in private markets, the transitioning of the banking system globally. We, as the largest manager in that space, continue to benefit, and we're growing well in excess of the market growth rate opportunity. Global infrastructure. We are going through a digital transformation propelled by the advent of artificial intelligence. The dollars needed just to support that market alone are roughly $5 trillion over the next 15 years. $5 trillion. That capital does not exist in our system today. Given our capability in renewable energy, digital infrastructure, and infrastructure debt, we will be riding that growth wave. And then, as Raj will talk about in a few minutes, the growth in wealth, the democratization of our markets, has created huge growth tailwinds as well. But size matters. The big will take share, the big will get bigger. When you look at LP behavior, LPs are consolidating their GP relationships. If you look just at the private credit market over the last five years, close to 60% of the capital raised has come to the top 25 managers, with Ares at the top of that list. That's almost twice the market share that we had in the five years prior. Our markets are growing, and they're consolidating. You could also see that in increased M&A activity. GPs are consolidating smaller LPs that have unique capability but don't have the capacity to benefit from this market growth. You're seeing a similar share trend happening in the wealth channel as well. So knowing that that is happening, knowing that scale matters, knowing that size matters, and knowing that these markets are consolidating, we have continued to invest in building out scaled solutions for the market. This is something that we showed you all at our last Investor Day in the summer of 2021, and you can see the rapid evolution of the product set. I mentioned earlier, the growth is diversifying, but it's accelerating, and you can look at businesses like Alternative C redit. $36 billion in that business. In the summer of 2021, we had that on this chart as an emerging business at Ares. It's now a $40 billion business. Infrastructure Debt, emerging, it's now a $10 billion business and rapidly growing. And then when you look at what we're building for the future in places like Asia-Pacific, private equity, credit secondaries, sports media, and entertainment, I have a hunch that when we're together with you in a couple of years, you'll see movement of those new strategies at an accelerated pace as well. I mentioned global expansion. This is important, and this is the value of having these local market entrenched relationships. We need to see where the puck is going. We need people in these markets understanding the behavior of businesses and assets and consumers and regulators in those markets, so that we can build the businesses of tomorrow. And if you look at the historical growth of the firm, we used to be a North American-centric business. In 2006, we expanded into Europe. Europe is now a fully deployed business for us. We are in all of the local markets with all of our products, and we hope to replicate that as we continue to move the business into the Asia-Pacific region. Again, I mentioned that we do this with a significant amount of intention, and I think that we are ahead of the pack on the way that we think about attacking these opportunities. We have a corporate strategy group within the firm. It's comprised of 25 people. They are charged with focusing on the growth strategy of the business, the operational strategy, and how we deliver innovation through technology into our own company and into the portfolio. If there's a business for sale in our market, they've seen it. If there is an industry opportunity for growth, they are building a white paper on it and a strategic roadmap for how we're gonna attack it. When you look at what they are able to accomplish operationally, when we're bringing on new businesses, they're able to get them integrated quickly against the growth plan and deliver results. To that point, we haven't talked a lot historically about the acquisitions we've made, so I thought maybe we would give you a little bit of context for just how powerful this group is in identifying scalable opportunity and driving value. Again, we have a very simple filter for how we think about acquisition. We want it to be culturally accretive, we want it to be financially accretive, and we want it to be strategically accretive. We want to take good businesses and make them great. We want to see meaningful revenue synergy, not meaningful expense synergy. But I mentioned culture first, because again, in order to do this well, you need to bring people into the firm that are culturally aligned to us and our values. One great example of this is Black Creek. This is an acquisition that we made in the summer of 2021. Market-leading industrial real estate manager with a fairly narrow but exciting family of, non-traded REITs. We acquired this company for $725 million, 40% cash, 60% stock. And when you look at that in terms of an FRE multiple in 2022, 5.5x. Financially accretive, clearly, but when you look at what we've been able to do with the business in the short time that we've owned it, we've been able to grow FRE at a compound annual growth rate of 35%. We took it from $56 million to $107 million. When you look at the AUM in wealth, we were able to take that capability, pull it up to the top of the house, and you can see that we've exploded the growth in the wealth channel by 50% in the last three years. Similarly, if you look at Landmark Partners, we identified a transformation occurring in the secondaries market, a shift from LP-led to GP-led, and a shift away from private equity to a broader collection of alternative strategies. We went out, we acquired Landmark. We paid $1.1 billion for it, 75% cash, 25% stock, 10 times purchase price. We've now revamped the product set, we've added a wealth product, we've grown a credit secondaries business, we've invested in the team, we've globalized, and you can see the AUM up 30% since acquisition, and accelerating, and you can see the FRE contribution up 30% since acquisition as well. When we're making these acquisitions, because of the scale of our platform and our ability to invest in growth engines, we also are able to take what we would call underutilized assets in a number of these situations and pull them up to the top of the platform to then redeploy them into other parts of the business. So in the case of each of the two examples I gave you, Landmark had a quantitative research group of 25 data scientists that were basically supporting the underwriting of secondaries portfolios. We pulled them up into our corporate strategy group. They are now delivering that type of analytics, both to other parts of the firm and to our LPs, as a way to help them think about portfolio construction and risk in a way that they otherwise wouldn't. And in the case of Black Creek, as Raj will demonstrate, we were able to take a very well-developed wealth distribution capability, grow it, globalize it, and build more product for it in order to take advantage of that as well. And then we can't have an investor day in 2024 without talking about AI, so I asked ChatGPT to put together a slide about the opportunity for AI in the private markets, and this is what they came up with. But in all seriousness about being forward-looking, our corporate strategy team went out and said, "We're not gonna be able to do this alone. We need to go out and acquire capability and experience to drive innovation into the business in a way that is required to support future growth." We recently closed on the acquisition of a venture AI firm called Bootstrap Labs. We've brought a dozen technologists onto the platform at the top of the house, again, to deploy into the investment portfolios to enhance margin and create efficiency. We've unleashed them into the business to help drive efficiencies in the investment process, look for ways to harness our data to make better investment decisions, and we're unleashing them on the business operations side of the house as well, to help us figure out ways to scale our margin to support our future growth. And then lastly, as I said, we have a plan. We are thinking about where the puck is going and where new markets will open to us. Things we're focused on is the continued growth in insurance, which David Reilly and Lou Hensley will talk about a little bit later. We continue to think about how to grow in the APAC region with a focus on real estate, and we continue to think about how to scale up in infrastructure with a particular focus on the digital revolution that's occurring. And so if we do all of that, if we build this flywheel, and we invest in our people, and we bring new capability, we should see that consistent, repeatable performance that Tony talked about, which, at the end of the day, is the lifeblood of this company, consistent outperformance. You'll see this throughout the course of the day, so I won't dwell on this, but each of our strategies over decades continues to deliver performance to our investors that has them coming back, growing with us, trying new things, and building enduring relationships, which is key to the future growth. So where are we going from here? I mentioned we're gonna continue to globalize and broaden out the product set. We will continue to build capability organically and inorganically. We will continue to invest in distribution so that we can get the front end of the funnel in terms of the capital formation, continuing to support the growth of the business. We will continue to build unique capability in local markets with a global perspective, and we're gonna continue to drive synergy across the platform and the portfolio using technology. I started my comments just talking about the opportunity to reflect on where we've been. Anniversaries are great for that, investor days are as well. In August of 2021, we sat before all of you and put out what we thought were pretty robust growth assumptions for this platform. We told you that we were gonna target $500 billion of AUM by the end of 2025. That was an implied growth rate of 17%. We've grown at 20%, and I think everybody can see that we're well on pace to hit the 500. We told you that we were gonna grow our FRE by 20%+. We've grown it at 33%. We told you that we were gonna grow our dividend 20%+. We've grown it at 26%. So when we look at the next five years, and Jarrod will drill down into how we get there, not from a, just a strategic perspective, but a financial perspective, it is our expectation but that by the end of 2028, over the next five years, we'll land at $750 billion+ of AUM, and again, quality AUM. We wanna raise AUM that is durable, long duration, high fee, high margin, and that excludes acquisition. Two, we expect that we're gonna be growing our RI 20%-25%, and our dividend will follow at a 20%+ growth rate, landing us at roughly $7.66 per share at the end of 2028. So as Tony mentioned, for all of the great things that have happened here over the last 10 years, as we reflect back and learn from that success and apply it to the future, the growth trend that is in place here is still here, and we expect will be for the foreseeable future, given the quality of the business that we've built together and the quality of the market opportunity that lies ahead. So looking forward to a great day. Thank you for your continued support. I'm grateful that you're spending as much time with us. And with that, it's my pleasure and honor to call up my friend and partner, Jarrod Phillips, to dive into the financials. Thank you. Morning. It's great to be here. It's great to see all of you here in person. Hello to all of you on the live stream. Sorry you couldn't be here in person with us, but we're excited to have you. It's my pleasure to talk to you a little bit about our financial results, where we've been to where we're going. Ultimately, I do want to just stop and reflect on the last five years, because we're talking about our five-year plan here. What do the last five years look like? You can see in our last 12 months, we've hit records across all of our major metrics, and we've been up more than 25% on CAGR for all of our major metrics. This is a great launching point. We've done it consistently with a business model that we believe has us well positioned for future growth and is gonna continue to drive growth forward. I'm gonna spend a little bit of time today talking about each of these items. First, I'm gonna talk a little bit about our management fee-centric business that drives high-quality FRE, that makes us more stable and predictable within our growth. I'll talk about the long-dated, long-duration capital that enables that. I'll spend a minute on our balance sheet light model, which we believe enhances the cash flow to our investors and enhances the cash flows available to invest in new management fee growth areas. I'll talk a little bit about how our growth has come with an expansion of scale and an expansion of our margins. And lastly, I'll spend some time on our European waterfalls. To start with our management fees, this is our slide of many colors with our numerous platforms that we've put together lovingly and we're very, very proud of. So you can see up here how diversified that we've been over the last five years. We've grown our core businesses. At the same time, we've added new businesses, and we've seen growth in management fees across the platform. This is core to how we view our growth going forward, is continue to grow what we do well, as Tony said earlier, but find new areas to grow in an outsized manner. It's important to understand how we grow our management fees in different market environments. When you take a look at what we put up here, we tried to summarize as we were thinking about the questions we get from all of you, what are the different market environments we get questions about? When default rates are high, how have we grown? And you can see up here that we've grown when default rates are high. When M&A volumes are low, we've grown. As we've seen for the last year, M&A volumes were relatively depressed. And in fact, if I took this graph back a little further, back to the turn of the century, 1999, 2000, you'd see a dollar value of M&A transactions that was reasonably similar to what we had last year. When you adjust that for inflation, it's almost 60% higher in terms of dollar value. So we know that M&A works in cycles. The ability to grow when that cycle is slower, like it has been for the last year, and be prepared for when that cycle kicks back up, is very important. And then a question we often get is: Well, what about interest rates? When interest rates were low, we got the question of, "Well, are people just coming here in search for yield?" Now that interest rates are high, we get asked, "Well, how is it going to change when things are low?" You can see here that we've been able to grow our management fees throughout interest rates being low and interest rates being high. One of the reasons for us to be able to grow in all these different scenarios is that long-dated, long-duration capital. That means that when investors commit their dollars to us, we can continue to hold that without fear that they can call it back. We can invest it when it's the best time to be investing. We can generate alpha for them by investing in the right companies at the right times, and we don't have to be on defense, protecting the portfolio. That's what has enabled us to grow. You add to that, that the majority of our growth comes from the speed of our deployment and our deployment in our portfolio. Unlike equity-based strategies that are really just committed and rely very much on the next fund to grow, as we raise, we prepare to deploy. That shows that we're also not as correlated to a fundraising cycle. When fundraising cycles have been low or when they've been high, we've continued to grow. That's because of the nature of the AUM that we manage. So we're very focused on deployment and how much we can deploy within a given period, and what the markets are for that deployment. Just like that first slide that I shared, you can see here that the deployment that we can have off of our platform has diversified significantly over the last five years. And in there, you see that coiling for growth that Mike talked about. You see that we understand that those M&A markets, they go in cycles, they come and go. We need to be prepared for higher deployment environments. So we build behind that. We build based on our dry powder, and we build based on the markets that we operate on. So I, I wanted to come up with a way to help you understand how we can view what our deployment could be within a given year, and what are some correlations that we've seen in the past. In our earnings presentations, you'll often hear me talking about our AUM, not yet earning fees available for future deployment. That amount, if you take that amount at the end of any given year, so if you take it at the end of 12/31/2023, we had $63 billion, a record for that amount. That would equate to a little over $620 million of management fees. But then you see, what's our drawdown deployment been like in the years after that? And you can see from up here that there's a pretty high correlation. Our drawdown deployment has run from 85% to well over 100% of what our AUM not yet paying fees were in the prior year. So that would tell you we have a tremendous capacity for deployment going into this year, and as we continue to fundraise, we continue to look to build that capacity so that we can deploy in all types of markets. That diversity in management fees also is carried over into our other fee income, and when you take a look at our fee income, that's really because of some of the new businesses that we've added and some of the things that we've enhanced. For instance, we have a registered broker-dealer that can now participate in capital markets transactions. So you've seen us grow our diversification and the ability to generate other types of fees in addition to just our management fees. When you take that fee income plus your management fees, you have very strong FRE that supports your RI through various periods. So if you look here, you can see that FRE has maintained a high percentage of our RI year-over-year. And again, looking at a market where there's not as much realization activity, you can see that FRE has continued to propel our RI to growth year-over-year despite that. Now, we would expect in a more normalized environment that FRE is going to run about 80% of our total RI. And one of the important things about our RI is these represent earnings that actually are distributable. They're not earnings that have to go back into a capital machine or have to go back in to support our balance sheet. That's one of the precepts of our balance sheet light model, is creating free cash that enables us to grow our management fee business. If you see here, our balance sheet investments represent 0.5% of our AUM. That stands in a pretty large contrast to our peers, whose average is about 8.5% of their AUM. We're not actively investing in our funds. We invest in them strategically when it allows us to grow our management fees. That also means that we can put together a better ROE, because our ROE is not dependent on the compounding of investments on our balance sheet, but on the funds that we manage. Having that limited balance sheet exposure makes us less exposed to changes in interest rates. Changes in interest rates won't affect spread earnings that we have. They will be much more minimal compared to what they would be if we had a more balance sheet-intensive approach. Now, taking a step from our balance sheet light model into our margins, you'll see here that along with that growth that I highlighted in the first slides, we've continued to expand our margins. So in that 25%-35% growth time frame, you've seen that we've expanded our margins from slightly below 30% to slightly above 41%. We believe that we'll continue to expand our margins with growth, but very important to us, we won't sacrifice growth in order to expand our margins. You can see here just a little bit of the scale that we've driven. As you see, our AUM per professional, our management fees per investment professional, that's allowed us to grow our scale over time. Now, when I say that we're going to, we're going to prioritize growth, and we're going to look at that first, I want to show a couple examples of how we've done that in the past, and then I'll show a couple examples of, of what we're doing right now. But our opportunistic credit business and our alt credit business, they both, if you had looked at them five years ago, were, they were compressing our margins, and in fact, if you add them together, they were little zero to negative FRE. But we believed and had a lot of conviction in the growth of those strategies, and you can see today they are highly accretive to our margin. They have helped us grow our FRE significantly, and they are some of our best-performing overall investment classes. This is what we look for when we're investing. If we had sacrificed these businesses for the expansion of margin, then we would be a lot less successful in the long run. So our goal, again, is to look for those areas where we can grow and invest in them wisely. So if you take a look at this next slide here, it highlights for you three areas that we're focused on now. And if you take these three areas, our real estate, multifamily, vertical integration, our European real estate debt, and our credit secondaries business. If you look at what their economics were to the firm in 2023, they were a drag on FRE, and they compressed our margins. If you look at what we believe we'll build over the next five years in these businesses, as we see acceleration across all of them, we believe that they'll be accretive to FRE, and they're going to add 115 basis points to our margin. So again, focusing on how can we build businesses with high-quality fees, long-term growth, and doing that even though it may compress margin in the short term. This shows you some of the businesses that are more mature on the platform and the margins that we can use to support some of that growth over the long run. It also gives you an idea of where we believe we can get to with a lot of our businesses that are low margin right now and growing. But I know everyone's interested in where do I think we can go with margins in the long run, and that's what's highlighted here. When I think about our margins, if I just said today, we'll tamp down growth activities, and all we'll do is focus on that AUM, not yet deploying fees that I talked about earlier, that would add $620 million of management fees. That would then added to what we already have, would put us at a margin well over 50%. So I think we can get to that margin over 50%. We're marching there. I would expect every year you'll see margin expansion, very likely, somewhere between 0 and 150 basis points, but it's gonna depend on our deployment. As I highlighted earlier, the faster we deploy, the faster management fees grow. The faster management fees grow, the faster you generally see our margin expand. So it's gonna depend on that deployment environment and what other opportunities may be present in the market at that time that we may look to invest in. But overall, we have a lot of runway with margin, and we're very excited about the potential that we have there. When it comes time for it, there will be significant tailwinds in using margin for additional growth. Now, it wouldn't be a presentation of mine if I didn't talk a little bit about the European-style waterfall. For those of you who are just joining us, the European-style waterfall represents performance fee income that you receive once an investor's original investment has been returned and their preferred return has been reached. So it's generally late in the life of the fund. What is unique about our European-style waterfalls is it predominantly comes from our credit business. Over 77% of our incentive-eligible AUM, that's European waterfall, is coming from credit funds. Now, why that's a little different than people may be used to is your American-style waterfall is the more traditional equity style, where when an asset appreciates and I sell it, I harvest, but that was very much reliant on a mark-to-market that was there, and actually being able to harvest at that mark-to-market. In a credit fund, you have a loan that you've made at or near par. You know a maturity date of that loan, so there's not a guess as to when it may be sold. You know what the outer bound is. Then that loan is going to mature at par, and it's going to have a stated interest rate or a stated yield that's associated with it. So you're able, with much more conviction, to predict the amount of performance fee that you're going to generate from this because it isn't dependent on as many variables. The primary variable you have, really, is the duration of the asset, because most of these assets don't actually go to that final maturity. They go somewhere earlier than that. Now, where are we right now? You can see the slope of where we're at right now. We're at the very beginning stages. So what we're harvesting today is this far side, this $27 billion and $31 billion of incentive-eligible AUM. That's what's just entering the harvest stage. You can see that this has grown 36% over the last years, up to $134 billion of incentive-eligible AUM that will earn these European-style waterfalls. But right now, we're just seeing the performance come through on a much smaller amount, on that $27 billion and $31 billion. And how's that ultimately gonna come through? Well, that's gonna come through over the next 10 or so years in the following manner. As we see that first batch come in, that's what we're seeing that's gonna be paid towards the end of this year into 2025 and 2026. Now, as I mentioned, duration is the one variable, so we ultimately are able to calculate what we expect to get. And what we use is, what are the dollars in the ground? What's the forward curve look like for those dollars? What's my expected then incentive fee that I'll earn? And for those dollars that are not yet invested, what's the ultimate target return for those? And that's what leads you to the $3.6 billion that you see up there, and that is $3.6 billion of net. So that's the bottom line amount that will be coming to Ares Management. You can see, because we're at the early stages, the strength of that $134 billion as it's there and earning, that's going to drive a significant amount of cash flows into that 2028-2030 period. So it's something that we're excited about and we're looking forward to. Now, what are we gonna do with that cash? Is another question I get every time I talk about this. Well, it's gonna provide flexibility first and foremost, and it's gonna depend on the year that it comes in and what opportunities present themselves in that year. But ultimately, we're gonna follow the same thing that we do now with our free cash. We're gonna look to seed new growth strategies. In other words, look for areas where we can generate more management fee. We'll look to fund accretive acquisitions, as Mike discussed. We'll look to enhance our dividend distributions, and if the timing's right, we'll look for share repurchases or debt paydowns. So it is flexibility. I think that's very valuable, and it's something that we're very, very excited about. Now, we'll take a look at what our forecast looks like over the next five years. So AUM, as Mike highlighted, of over $750 billion. It's key to see that this is growing at 50% faster than the projected industry rates. As Mike also mentioned, the goal is to grow quality AUM. We want AUM that is going to be high fee and is going to allow us to continue to grow with margin. We would much rather raise $50 billion at 100 basis point management fee than $100 billion at 30 basis points. We're looking to grow with quality and use that quality to then build on our FRE and RI. You can see from this that quality AUM will enable us to over double our RI and our FRE. Here you can see the strength of the European waterfalls coming in with the outsized growth of our RI over FRE. Lastly, how does that impact our dividend? Because of the conviction of the cash flows that we have coming in, we're targeting over 20% growth of our dividend for the next 5 years. So continuing to return with the dividend. So what have we gone over here? We're well positioned with our model to continue the growth trajectory that we've been on. We're gonna continue to invest in growth opportunities. We're gonna generate over $3.6 billion of European waterfall performance fees. We're expected to grow faster than the industry average in our AUM, and importantly, we're going to more than double our FRE and RI and have a 20%+ CAGR on our dividends. With that, I'm gonna turn it over to my friends and partners, Ryan, Tony, and Ed, to talk a little bit about business development. Thanks, everyone. Have a great rest of your day. Thank you, Jarrod. Hi, everyone. It's such a pleasure to be here with my partners, Ed and Tony. But to be more formal and to really test my pronunciation, Edward Polonsky and Anthony Pawlowski. Yep. Well done. Even though we've worked together for over 10 years, I'm still really impressed we can get both of our names out in the same time. Yeah, this is, this is my big moderator test right now. That was good. So Ed, Tony, along with Sundo, oversee our global relationship management, and they've been outstanding business builders for our firm. And I think we're really proud to be coming to speak with you here today, where our teams have had some very strong performance for an extended period, and that really went into this past week, where we're just fresh off of our first firm-wide AGM. It was in Scottsdale. We affectionately called it Ares-ona, and we brought together around 900 travelers from about 150 destinations, and we're just so pleased what it says about the strength of our partnership and positioning with our incredible investors. It was great that a lot of- Yeah ... investors that don't normally get to see certain parts of our platform got exposed to the entire platform for the first time. No, really pleased. Also pleased that the three of us made it here today. It was a big week, so I think what we're gonna focus on this panel is really around our business development capabilities across the firm, and then I'll ask Ed and Tony to do a deeper dive on their institutional investor perspectives. So Ed, why don't you kick it off? I think we have a familiar slide I've seen before, but maybe to kinda set the stage, please. Sure. It's, it's interesting to note that this is the same three themes that Ryan presented in 2021 at our last Investor Day, and they are entirely consistent with the key takeaways from today. So the first one is, we've built a powerful network of client service teams working in partnership to develop solutions for our clients. The second is the ongoing growth and diversification of our AUM highlights and really validates the merits of our approach. And third, we have a tremendous opportunity to broaden and deepen our investor relationships and continue to grow. Great. Thank you. So to put more specifics around the significant investment that we've made in these functions that we refer to as GCSIR or Global Client Solutions, we have gone from about 80 to approximately 400 professionals. You know, we are large, global, and we're highly collaborative, and it's really this development and this federation of teams that I think has enabled us to really go deeper and broader with our clients and become that much more relevant and important to them. We look at GCSIR as really having four main segments. We'll hear from Raj, our partner, shortly on the wealth segment, but maybe each of us can kind of speak to the other three, with a couple of highlights of what we've seen over the past handful of years. Tony? Sure. Thanks, Ryan. With respect to relationship management, we've got over 80 RMs based globally in a variety of regions. Sundo, Ed, and I, as Ryan said, lead those teams. We're based locally and placed to be as close to the client as possible. We're generalists. We cover every product that Ares sells, which allows us to listen to clients actively and create solutions for them, help driving growth for the firm, but also ensuring that the clients are connected with us. We've also meaningfully grown our product management and investor relations team as we've expanded our product range. These individuals are product specialists that sit firmly within the business groups and represent the LP voice in the room, and service the global client base for those products. They're responsible for all the fund documents, the structure, the data room, reporting, and really drive the fundraise from within the business, working very closely with relationship managers to make sure we have the right products and the right structures in the market. So for example, our European direct lending franchise, which we call ACE, was initially a European-denominated levered fund. That has evolved into today, where we now offer 4 different currency share classes, euros, dollars, yen, and sterling. We offer levered and unlevered share classes. We offer rated note feeders to really meet the appetite and demand that we're seeing from our clients. Most of our flagships have those- That's right structures baked in now. Fantastic colleagues here, really quarterbacking all of the resources, as they look to drive their respective fundraises. And this fourth segment, which we call investor strategy and GCS operations, we take a lot of pride here. This is a more recent initiative, where we've looked to really take a handful of teams and develop real centers of excellence to really enhance the client experience. These teams range all the way from our amazing events team, as we increase the number of regional events that we're taking around the world, really looking to get in front of our investors, showing our different strategies and our culture. And they go all the way to our quant team, really developing research and analytical differentiated insights that help our investors think about their portfolio in different asset classes. I think I'll just conclude this page with why we're very proud of how significant we've grown to about 400 dedicated GCSIR team members. We really view a competitive advantage of Ares is just how involved our entire organization is in client service and really creating solutions. You certainly see all of our senior investment leadership and business colleagues really get involved in our clients and form really long-lasting partnerships. So that's a little bit how we're set up. You know, maybe Tony, starting with you, as we think about kind of performance over the past few years. Yeah, thanks, Ryan. I think we're all really proud of this slide at Ares, everyone involved in marketing. We're proud because of the growth, but the expansion as well, of the relationships. On the left and center charts, you can see the number of direct investors we have at the firm has grown since 2018. The center, where we've grown our larger relationships, the billion-dollar plus accounts, over 3x, but the AUM in that cohort is over 5x. So we're extremely proud of that, but the story doesn't end there, right? When you look at the right, you'll see almost two-thirds of our direct relationships now invest in two or more of our business groups: private equity, real estate, credit, secondary. As we look to grow the relationships and clients entrust more capital with us, they're doing it across the platform. Ed, maybe you can share some observations that we have really by our direct investors, so investors not through an intermediated channel, how those inflows have come really shaped by the relationship status that we have with these direct investors. Sure. I think this is a very important slide. If you look at the dark blue segments, you can see that since 2019, approximately 85% of our inflows have come through existing relationships. As we've been able to deliver on performance and deployment and realizations, we've developed a very loyal LP base that have ultimately cross-pollinated our platform, and importantly, helped support us in building new strategies. So our relatively recent European real estate debt and credit secondaries strategies were effectively put in business by large anchor commitments from long-standing strategic partners. And at the same time, we've added a lot of new investors onto the platform. So you look at 2023 on the slide, we've onboarded 300 new LP relationships last year, which over time, we expect to grow and also invest across multiple strategies and expand across the platform. No, I think it's, it's a key highlight. It really reflects the great investment teams that we have, that the investors who know us the best are really accounting for the significant majority of our inflows, while still we're adding a lot of new investors that we think, you know, we can really kind of grow over time. Maybe to both of you, you guys wanna speak about how we've kind of diversified by strategy and product type, please? Sure. If you look at the left side of the page, I think this goes back to the overarching theme of Ares as a solutions provider. Increasingly, our clients are very focused on the format of their investments, and I know Raj will speak soon to the exciting vehicles we're creating for the retail channel. But similarly, evergreen structures, open-ended funds, separate managed accounts are in demand by institutional investors who consider alternatives, especially private debt, core long-term holdings for their portfolio, and they're not set up well to process re-ups or re-underwrite closed-end campaign funds every three years. So we're creating a wider range of formats to service our investors. Yeah, and on the right side, you can see our flagship private credit funds continue to be major contributors to our AUM. But what's happened, as Mike referenced earlier, these newer strategies we've developed, these new business lines, are not only contributing today, but are engines of growth for the future. As we look at secondaries, insurance, infra, real estate, we're starting to create new funds and new products, which help us provide more solutions. Yeah. Well, we keep using client solutions, so importantly, put it in our group name, but it's a, it's a big focus for us, just really the whole mindset of trying to match up our external and internal clients. But if we go to the next slide, I think, you know, this really helps us be able to really go in and sit with our investors, think about what they are looking to achieve. So over the past five years, we have tripled the number of fund families that we have that has at least a billion-dollar fund or greater. And so when you add in what Ed has shared, that even ACE, an existing vehicle, has more access points for some of the structuring we've done, there's just so much more opportunity for us to really go out and tailor our approach to these different clients around the world and really look to solve their specific objectives. So I think we've covered a little bit where we've been, where we are today. Maybe, I guess, to each of you, as we think about the outlook, and, and how we feel we're very well positioned today. Ed, you want to start? Sure. So I think the first point I'd make on this slide is that alternatives have now been tested through multiple market cycles and have behaved as they were supposed to in terms of performance and mark-to-market volatility. So a lot of our institutional clients continue to increase their allocation to alternatives. The second point is, in this prolonged high interest rate environment, institutional investors recognize that there's a value transfer from equity to debt, in particular, floating rate private debt, and continue to increase their share, which Ares has been a big beneficiary of. Just in the UK and Europe, we see insurance companies really proactively trying to ramp up private credit on their balance sheet in capital-efficient format. The third point is that the largest sophisticated investors in the world are seeking a few partners that can deliver holistic, diversified, private market solutions and deploy and scale. So again, Ares has been a big beneficiary of this theme, and as our relationship managers are all product generalists, they're well positioned to have these types of strategic conversations rather than just pitching individual strategies. And finally, in this world today, it's not enough just to originate and deploy capital. Our clients really want to see money coming back. That's critical today, and we keep hearing from our investors that DPI is the new IRR. Tony? Yeah. Now, the next slide, we'll just go through some of the key growth drivers. You know, Mike mentioned some of these earlier, and we thought we would dive in a bit. So we expect the institutional alternatives, you know, bucket to increase significantly in the next eight years, and Ares is well positioned, given our product set. The tailwinds of the movement, as I just mentioned, from equities and traditional fixed income into private credit, we, again, are well positioned to take advantage of that with our product set. When we map out our clients, where we should be, who should be our clients, and what they should be engaging with us, we have a lot of white space. When Mike talked about wallet share and market penetration, we see tremendous areas of growth, all, you know, coming in the years ahead. As Ed just said, there's a consolidation going on right now, where the biggest, and not only the biggest, but most of the largest, LPs are looking to consolidate with the major GPs. And then our product set, as Ryan showed in the last slide, our 30+ large fund families allow us to deliver the proper solutions and deliver growth for Ares. Great. Well, to close, I'll just say it's a real pleasure to partner with each of you- Thank you. And our wonderful colleagues across GCSIR. We're very proud of what we've built, the culture and the mindset of the whole organization to really be client-oriented in creating solutions, and we feel very excited for the outlook. So with that, we'll pass it on to our dear partner, Raj Dhanda, Global Head of Wealth, to talk about all the accomplishments and the opportunity in that channel. Thank you so much for your time. Thank you. Good morning. Great to see some familiar faces. Those of you that I haven't met before, I joined Ares in 2021 as part of the acquisition of Black Creek Group. Prior to that, on building that distribution channel, I was at Morgan Stanley for 25 years in various roles, including, among other things, I was responsible for all the investment products and research in the wealth channel. I share that because it forms just how excited I am, not only about being at Ares, but being at the intersection of alternatives and wealth management. As Mike outlined, it's a secular trend, and I've been in financial services long enough to know that you don't always get to be at the forefront of some, of some really powerful tailwinds and at a, at a firm with an incredibly great culture. So I want to focus on really three key themes. They're quite simple. You're going to hear them come out throughout the conversation. The first is, we're in the early innings of these secular tailwinds. Not only is the firm doing well, but the opportunity will grow in the wealth channel for alternatives. The second theme is, and it's an important one: there's a competitive moat around what I believe are five or six firms around the industry that will lead to five or six firms being the winners. People, products, a track record, they're all critical to be successful. And then the third key theme is economies of scale are starting to emerge. We've made a significant investment, we'll continue to invest, but our fundraising results will far outpace our future investment. So I mentioned the opportunity. The future is bright, and the growth of the pie and the allocation to it is quite clear to me and others in our industry. Because of the aging population, because of the shift towards a defined contribution marketplace, you will see the pie grow from $80 trillion today to close to $100 trillion. The allocation to alternatives remains massively under any target, and there's tremendous support for that, not only from the financial advisor, but also from the banks they work for. And so you should also see the allocation grow materially in the coming years. So as I said, the future is incredibly bright. I'm very proud of the last three years. We've been busy. Our future will also be something I'll get to, but let me just step back and talk about where we've come from. It was only three years ago, we had 1 product to offer perpetually, and that was targeted to the retail client. It was only a few years ago, we didn't have the scale and the footprint to service these products and to distribute them in a highly fragmented channel. It was only three years ago that we were 12th ranked. Today, we're fourth. Only three years ago, we had a 2% share. Today, we have an 8% share. The results are clear. Our AUM has grown to approximately $25 billion, excluding ARCC, which, as you know, is largely held in the retail channel. Our management fees are paid day one, which is an important ballast to the financial results of the firm. Our strategy is quite simple. In this industry today, you need to have a global brand, a 20-year track record, relationships. Ares has all of those today. We leverage them every day in the retail channel. You need products that are targeted for the investor. These strategies allow you to work with large distribution platforms each day. We are one of the few firms, the only firm today in. We believe, I have to remind my Carl Drake, qualifiers. We believe we're the only firm today that has six semi-liquid strategies, all over $1 billion. The sixth will be $1 billion by June first. That's unique and important because diversity of offerings is crucial. We work with over 50 partners globally. They know Ares, they like to partner with us, and those partnerships are critical to our strategy. We think about all parts of the retail channel and have the resources to execute with wirehouses, RIAs, family offices, private banks. Then we're focused on thought leadership, we're focused on education, and we use data where we can to make this channel less fragmented. We're trying to drive demand to our sales team, and it's key to our strategy going forward. As I mentioned, we're pleased with our results, but it's just the beginning. We've taken our quarterly flows to 2-3 times what they were just 3 years ago. We've broadened our product suite, and we've grown globally. Over a quarter of the flows recently have come from Europe and Asia, where we've built out teams and will continue to invest. As you can see, we've steadily added strategies that give us one of the most diverse and complete offerings in the industry. After product development, you need to broaden your partnerships. As I mentioned, we work with about 50 firms globally. There are 7 or 8 that represent over $1 trillion in client assets that help you anchor a product. CADC was an offering that we worked on from 2018 to 2021, and quickly were able to put together 3 of the leading platforms to offer the product. While there have been headwinds for real estate strategies, we have still put together three new partners for our non-traded REITs, importantly, during this period. We raised over $2.25 billion for ACIF, APMF, and ASIF, really with just the support of one key anchor. The future is incredibly bright as we grow our partnerships. It's also an exciting time because our penetration will grow. We have yet to do business with 95% of our addressable market. In fact, 90% of our business, 90% of the advisors we work with have only done one product with us. With our diversity of offerings, with our strategy to be product-agnostic, all of that will change. It's not enough in today's retail channel to simply have products. They need to be differentiated, and they need to span the full spectrum of core to opportunistic, open-ended and closed-ended. And in each asset class, you need to be a leader. You need to have something to win across the many offerings. No doubt you're well aware, our credit platform is highly differentiated. Again, I'm reminded about the things I'm not supposed to say, but we might have the number one platform as the retail channel thinks about our Credit Group. And we can offer strategies in different form, and that's quite crucial. I believe that in private equity, over time, secondaries will be the preferred method of investment. The level of diversification without sacrificing return is actually a remarkable and very relevant for the individual investor. As I said last night over cocktails, my personal experience investing poorly in vintages would have been certainly much better had I had the opportunity for the secondary strategy across the different private equity opportunities. And then in real estate, tax is a key differentiator. Everyone has seen how we grew the REITs with the ability to offer a 1031 solution side by side. It allows you to bring net new assets into an advisor's book, offer a tax solution, and create really sticky shareholder base, which the latter was quite useful to us in the last couple of years. In the 1031 exchange market, we have an 18% share. The next closest competitor has a 9% share. So as you go across, working backwards, we are differentiated in real estate, we are differentiated in private equity with the only pure play secondary strategy, and of course, we have the preeminent credit platform. As I mentioned upfront, economies of scale are emerging. We will still invest. Europe and Asia are key areas for that growth. However, this is a scalable platform today. Our fundraising should double, while the CAGR for our investment will grow at roughly 10%. This still is a highly fragmented channel. It's a big part of why I say there's a competitive moat. It's key to why we are thinking about how to drive the financial advisor and their clients to our team. Core to that strategy is Access Ares. Core to that is leveraging content that we already have, leadership that we already have, that can use our platform to reach the audience much more efficiently. So let me just end with where I started. This is an exciting opportunity. There's a true competitive moat, and economies of scale are emerging. If you just think about where we will be or what our goals are, we certainly have a product suite that is quite diverse and among the leaders in the industry. I mentioned the sixth of our new semi-liquid strategies will cross $1 billion on June first. It's not just one thing to have a product, but you need to get to that first $1 billion. It's the most crucial start you need for any fund. Our team will continue to grow. Our rank should improve to the top two or three, and that rank in wealth management is really the equivalent of number one, I believe. The financial advisor offers two to three solutions when they pitch a strategy, and as long as you're in the top three, you're going to be one of the leaders and winners. And then a much-debated AUM target of $100 billion. We have clear line of sight to that. We feel really comfortable that with our solutions in place, with our team, and with all of our capabilities, the associated management fees as well from day one will be a big part of our future. So we just want to thank everyone for giving me the time to be with you. I've been here three years. I feel like I've been at Ares 30 years. I'm gonna introduce my partners who lead our Global Credit Group, and I look forward to seeing you again in the near future. Thank you very much. Hello, everybody. The three of us are delighted to be here. It was fun hearing Tony and Mike's opening remarks, talking about anniversaries and investor days and all that. The three of us have been together for 25 years. We've had some interesting times, but it's always been a pleasure, guys. So listen, I feel we have a pretty easy remit this morning. We're here just to provide a quick overview of where we stand in credit, which, of course, is our largest business. But we're getting a little bit off the hook with only 10 minutes, because we really wanna feature some of our strongest players. We have Kort Schnabel, Blair Jacobson, Joel Holsinger, Aaron Rosen, and Edwin Wong, all coming up to do distinct segments on some of the verticals that we're managing today. A big part of our job, as we think about it, 20 years into coming to Ares, it's really about getting the right players in the right position on the field, and that's something that we spend a tremendous amount of time on. Invest in our people, invest in the types of people who work with and for us, empower them to run their businesses and achieve success. We can't do it by ourselves. We don't do it by ourselves, so I'm thrilled that you'll get deep sessions on really each of the five verticals, which you'll see here in the middle of this slide. Direct lending in the U.S. with Kort, alternative credit with Joel. We're not featuring liquid credit today. We want to put a little bit more focus on opportunistic credit with Aaron, and then have Edwin come up and talk about APAC. But all in all, today, we manage a little bit north of $300 billion in credit. We have 500 people. It's obviously a global business, leading with North America, but Mike mentioned our expansion into Europe in 2006. That's become a very large business today, and we're very focused on growth in APAC credit. But again, one of the few platforms that's truly global, that I think has a 25-year investment track record. Mike and Tony stole some of our thunder. We say this over and over again, our business in credit leads by bringing origination and bringing unique, differentiated deal flow to our investors. That's why they come to Ares. We've got a great liquid credit business that provides the, you know, the foundation for deep credit research and industry analysis. Again, it's really all about deploying people into these local markets in geography, and you'll see how the growth in our investment professionals has grown. I know Mike talks about this a fair amount. We have the highest investment professional count, I think, among any alternatives firm, particularly in credit, and I think we'll continue to. It's all about investing in those people. Over to Mitch here for a moment. Thanks, Kipp. You keep hearing us talk about the many advantages we go to market with in our direct lending group. You heard Tony talk about it. You heard Mike talk about it. I'm gonna focus on three: scale, origination, and incumbency, and I promise I'll do it quickly. As you can see with scale, we go to market with among the largest balance sheets in the industry, $190 billion and growing. So what does that mean? It means we can typically can commit and hold more than our competition. But what's wonderful about the fund platform that we've created at Ares, no individual fund ever takes undue risk. The average position size at ARCC is 0.2%, and that is not uncommon across our funds. Now, we have the luxury of running really diverse funds because of our origination. Our scale allows us to continually invest in origination. As Kipp just mentioned, we go to market with the largest direct lending team in more offices around the globe. Simply put, we out-originate our competition, and when you see more, you can be more selective. It is not uncommon in a given year for our direct lending teams to have gross originations north of $40 billion. What's amazing, and you heard Mike talk about this, we say no 95% of the time. So when you reverse engineer that number, you can get a sense of how much information, how much flow, the volume that comes through this system year in and year out. Most of our competition can't begin to process even a sliver of that deal flow. Finally, incumbency. Most years, 50% of our gross originations comes from our existing book of business. And so when you marry the largest origination team, by far, with the largest book of business, you get a sense of why our market share continues to grow year in and year out. So what does this mean in practice? How do these advantages help our investors? Well, on the right side of this page, I wanna focus your attention on, on that chart. And what it simply shows you is that irrespective of what's going on in the liquid loan market, the new volume market, our teams continually find unique assets for our investors, and they do it in scale. There's that $40 billion number I referenced. And before I leave and turn it over to Smitty, Kip p mentioned we weren't gonna spend a lot of time on our Liquid Credit Group, but a big part of our credit business is that liquid credit team. Our first fund at Ares in 1997 was a CLO, and we've grown that business tremendously over the past 27 years. Today, it's $46+ billion, and our teams constantly rank in the top quartile of performance. What's wonderful for the firm is not only is this a very large, growing business, but as Kipp talked about, our traders and our research analysts in this group constantly provide information and new deal idea generation across our platform, and not just to our direct lending businesses, but to our private equity groups, our alt groups, and our opportunistic credit groups. With that, I'll turn it over to Seth. Great. Thanks, Mitch. Brevity was never your strength- No. -and that was pretty good for you. I like it. It was great. I think as we think about the credit group, I think one thing we wanted to highlight was kind of the growth in the platform and the different asset classes, but also the size and scale. Mitch mentioned about how direct lending was the first business kind of that we started, and how we really focused on size and scale of the assets and the team. And what this chart is trying to depict here is, if you go back 5 years, we basically had 5 funds or series of funds, a public company, series of funds, that had $1 billion of aggregated assets. Fast-forward today, and there are 15 family of funds that have over $1 billion of capital, and that's what's great about it is the diversity of it. So you have alternative credit, a new silo within credit. You have special opportunities, a new silo. But then you have tangential silos within the direct lending business, sports, media, and entertainment, healthcare, and then globally, a business in Australia, which is now doing direct lending. So you can see the halo effect of having these large pools of capital in order to invest in different asset classes in different parts of the world. And I would say that the three of us are incredibly focused on two things here. One is continuing to add to the resources. So we want these funds to continue to grow, continue to prosper, continue to keep those competitive advantages, and we're dedicated to hiring more people, opening new offices, and expanding the footprint. And then second of all, we cross-pollinate on different investment committees throughout the firm. So if I think about Patrick Trears in our infra debt business, helping him solidify his sponsor relationships, working with Brian Donohue in the debt team on the real estate side to build size and scale, learn from the blueprint that we've created. And then I look at what Dave Schwartz is building, a partner who helped us build the direct lending business, and what he's doing on the credit secondary business. We can help with that infrastructure, we can help with that blueprint, and help them guide the way. A couple examples here. I look on the upper left-hand part of this, the European business, I look what Blair and Mike Dennis have built, and I wonder, you know, they must think how easy it was. They just copied everything that we did in the U.S. But I joke. They've built a phenomenal business. They had a first mover advantage, but they didn't rest on their laurels. They opened offices across Europe. They built size and scale in their capital base, and now they have a dominant market share in Europe and have built a phenomenal business. We wanna do that across alternative credit. It was a business that was kind of focused on separate asset classes with Joel and Keith now building that business to really take advantage of what is probably, as you'll see on the next slide, one of the largest addressable markets. If you look at Europe going from $10 billion to $50 billion and really kind of dominating the market, alternative credit is on the way there, and I think that could be a $300 billion business over the years. Then opportunistic credit, as we think about evolving, we've now repositioned that business within the credit group, more closely aligned with the private equity and the sponsors and the direct lending business, to take advantage of a changing market environment, and a great opportunity for that asset class. Then finally, I'll just kind of hammer home the point. This is a Carl Drake slide, so it's complicated. It used to have five axes. It only has two here. But I think what it does show is, obviously a very, very large addressable market, a $40 trillion market, where, as Mike mentioned earlier, we have about a 1% market share. So lots of opportunity for these funds to grow and to expand. Yeah, we had a slide that was significantly less complicated at the Investor Day in 2021 that we premiered there. But the question that I'll leave you with, that we get asked a lot, just in closing is: You guys have built this great market-leading credit business. It's so big. Aren't I just buying the index? And the simple answer, and Mike put the easier-to-read slide up is no. We're playing in a huge addressable market across corporate credit, asset-based finance, opportunistic credit in multiple geographies, and while we've shown tremendous growth in this business, we think the best is yet to come, and there's a lot of great stuff ahead. So, with that, I think we'll exit stage left and ask Kort to come up. Thank you. Thank you. Thank you. All right. Hello, everyone. I'm Kort Schnabel, excited to talk about our U.S. direct lending business today. As I think everyone knows, we have been in the direct lending business in the United States here at Ares for a very long time, longer than almost all of our competitors and peers in the marketplace that we see every day. We've invested through all different market environments over that 20-year period and generated industry-leading results for our investors, which has allowed us to amass more and more capital, and allows us to stand here today and present the largest direct lending platform in the United States. You can see in the pie chart there on the right, we manage $129 billion of AUM today. It's relatively diversified in terms of the types of funds that we manage. We manage over 50 different funds now in our U.S. direct lending business. The largest is $43.9 billion. You see there is ARCC. We have a whole afternoon dedicated to ARCC, our publicly traded business development company, but relatively diversified by fund after that. We've invested $142 billion since our inception 20 years ago, and we have a 2 basis points annualized loss ratio. There's so many things that go into that, don't have time to get into it here in this 5 minutes. Obviously starts with the broad origination, the saying no 95% of the time, and then, so importantly, our portfolio management team, the actions that we take when a portfolio company's performance is not going according to plan, our ability to work through that, get our money back, sometimes even get gains to offset our losses, all goes into that 2 basis point annualized loss ratio. We've transacted with 450 different financial sponsors. I think most people know the source of our deal flow is primarily financial sponsors, but we are not dependent on any one sponsor for our deal flow. That diversification is very important for so many different reasons. We've invested in the largest team now, we believe, in the industry, 200 investment professionals just in the United States, just focused on U.S. direct lending. We have so much more room to grow. This has already been hit on earlier a few different times, but in our U.S. direct lending business, we've sized the market about $5.4 trillion, $3 trillion, the traditional middle market, where banks have largely kind of been pushed out, mainly served by private credit providers. A whole another $2.4 trillion market that the banks are still very active in syndicating leveraged loans and high yield bonds. We're obviously just starting to chip away at that market. We have what we estimate is a 2.4% market share position today, so still a huge amount of runway going forward. This slide outlines our depiction of the market, where we sit relative to our competitors. You can see, as I already said, we are the largest. The Y-axis, by the way, is size of managers, so we sit there at the top. But maybe even more importantly, we are the only direct lender in the U.S. that competes across all three size ranges of companies, lower middle market, middle market, and upper middle market. Some of our competitors straddle a few of those, but no one goes across all three. This is really, really important. Gives us the ability to get in early with our portfolio companies when they're small, gain incumbency, grow with them as they grow. As you can see, lots of different, lots of different competitors, but we, we stand at the top. A little bit of, a little bit of backup data on the point I just made. You can see on the left-hand side, this is our origination over the last five years, the distribution of different company sizes. About 50% of what we are originating is less than $50 million of EBITDA. Allows us to move up and down, depending on what the market is giving us, right? Last 18 months, the banks were kind of on the sidelines. You can see we skewed a little bit more toward larger companies. Obviously, now, as banks are coming back, that origination in the lower and middle market is gonna help us continue to find the best companies. And the, the beautiful thing is on the right-hand side, you can see there is a premium for being able to invest in some of these smaller and mid-sized companies. Spreads are higher, leverage levels are lower. Talked about the sponsor relationships there on the left-hand side. It's grown nicely over our history, but maybe even more importantly, a new area that we are focused on is non-sponsor. We are trying to really make sure that we're penetrating more and more non-sponsored companies, staying a step ahead of our competition. We've put in place several different industry verticals with people that are just focused on those industries, which allows us to go out into the market and build relationships directly with management teams. You can see the increase over the last six or seven years now in our non-sponsored deal flow. It's grown from 11% of what we see to now 25% of what we see. Lot of stuff going on in this slide. We'll spend a lot more time on this this afternoon. But you can see the broad funnel that we've talked about. In 2023, we saw about $500 billion of deal flow come into our platform. That allows us to be super selective, as we've already talked about several times. You can see the bottom left, 4%-5% selectivity rate remaining very, very consistent over time. And then my last slide hits on our yields, our overall performance, going back to 2002 to 2004. Everybody always asks us: What's happening with private credit yields? Are they up? Are they going down? The answer is yes, all of the above. They go up, they go down, they change a lot based on what's going on in the market. But what's more important than absolute yields is relative yield, the yield that we're generating relative to the broadly syndicated market. Left-hand side is first lien yields, right-hand side is junior debt yields relative to the leverage loan index and the high yield index. We generate a 200-300 basis point premium over a 20-year period to the first lien index, and a 400-500 basis point premium to the high yield index, and maybe even most importantly, at the bottom, much, much lower loss rates at the same time. I'll end it there, and now I'm gonna have Blair come up to the stage. Great. Thanks, Kort. Hello, everyone, I'm Blair Jacobson. I'm responsible for our European credit business at Ares. So I'd like to rewind to the mid-2000s, when our U.S. direct lending team asked a very simple question, which was: Where else can this strategy, this blueprint that they've developed, work in other markets across the globe? Well, at the time, Europe was an obvious answer. A lot of great middle-market companies, a lot of private equity firms that are consumers of leveraged finance. However, what was not obvious was, frankly, there was nobody doing it. At that point in time, pre-GFC, banks had 100% market share for European direct lending of senior secured assets. But Ares said, "We can do this," so we entered the market, we lifted a team out of Barclays, and as you can see here, the rest is history. I'm really excited to share with you the business that we've built in Europe. We strongly believe that we are the number one ranked manager by many different metrics. You'll see here we manage about $70 billion of assets. That's grown almost 25% per year over the last 5-6 years. We've invested more than EUR 60 billion in more than 350 different companies. That's supported by what we think is the largest investment team in the market. Again, nearly 90 dedicated investment professionals across 6 offices. We came to London in 2007. In 2009, we opened up Paris, Frankfurt, and Stockholm, and 5 years ago, we opened up Amsterdam and Madrid. And all of that has been backed by very strong investment performance in true Ares style, backed by a very, very low loss rate. Now, why are we so excited about the European market? I'll contrast it a little bit in a few moments to the U.S., but suffice it to say, it is a very large market, about $1.5 trillion, with upside from there based on liquid loans and issuers that we think we're relevant to, and contrast that to our $70 billion of assets under management. We strongly believe there is a lot left for us to go for. Now, contrast it a little bit to what we see in the U.S. The European market structure, quite simplistic. At this point, it's really just banks and alternative managers, with banks steadily losing market share and groups like Ares gaining market share. We do not have a BDC market in Europe. The retail high net worth market is nascent, as you heard Raj say earlier. We have some really exciting developments on the Ares side there. There's no middle market CLO business. So from that perspective, again, it's quite simplistic, but in that way, it's very attractive, because I'll get to in a few minutes, it's very inefficient. So the risk-adjusted returns we can generate in Europe and have done are very exciting on an absolute and relative basis. But we don't think it ends here. There's a lot left to go for. European direct lending market really started in the UK, which was the hardest hit in the financial crisis. It's now spread to continental Europe. We're spending time now on Southern Europe and Eastern Europe. As our fund sizes grow, and there's a nice slide that was put up earlier showing that we're more relevant to bigger companies. So again, larger funds were more relevant to bigger issuers. Further, regulation's actually been a positive for us. The implementation of the Basel regime in Europe and Basel IV on the horizon means it's less efficient for banks to hold these loans on our balance sheet, so more of that is coming to groups like Ares, and also things like the non-sponsored opportunity. 25%, you heard Court say in the U.S., you're probably 5%-10%, and growing rapidly. So let me put some of this into some data and numbers for all of you. Starting on the left, again, when we started in 2007, bank market share, 100%. That has steadily been decreasing. 10 years ago, about 85%. Now, it's below 50%. And again, that's all been for the benefit of alternative direct lenders like Ares. Now, that might be a little bit higher in the continent, a little bit lower bank market share in the U.K., but the trend line, we think, is very, very clear. And that's also demonstrated by what you see in the middle, which is the number of deals done every year by alternative fund-based lenders like Ares. And that's grown 6 times in the last 10 years. Again, run rate, 600, 700, 800 deals done each and every year by fund-based lenders. Now, similar to what you heard Kort say, a lot of our companies are owned by private equity firms. The private equity business in Europe is highly developed. Over $250 billion of dry powder left to invest. Now, we'll need something like $250 billion of credit. Well, look at where European direct lending dry powder is, under $70 billion, and we simply think banks cannot fill the difference, again, creating a very nice supply-demand imbalance for us. Now, spending another moment on our business, we talked to something like 1,300 European companies each and every year, and that's grown significantly over the last few years, but we're still selective. Again, you'll hear this a lot today. We only complete with 3, 4, or 5% of the companies that we see and choose the very best. Now, another difference between the U.S. market and Europe, Europe tends to be more of a sole lender market. We don't have many club deals. And what this helps us do is control the return, the terms, the documentation on the way in. If the companies have any issues, we're in control of the outcome there. But again, the indicators are flashing green. We're seeing a 14% yearly growth in our number of introductions, and just last year, $25 billion of early read volume. So how has that translated into returns? Well, we've been able to convince investors around the globe that the relative value available in Europe is very, very attractive, as illustrated here. Most recently, again, our upfront fees in our deals, we charge it on every single one, has never been below 3%. Currently, it's a little bit higher. Compare that to other markets, it can be 50, 75 basis points more. Our loans also float, so again, Euribor just over 4%. In the U.K., SONIA, just over 5%. That implies with an 11% yield, we're making LIBOR plus 6 or 7. Add the fees to that, 3-year expected underwritten returns, around 12%. Now, the risk we are taking to achieve those returns actually has been going down. That's why spread share and leverage has been going up, but again, over time, when rates go up, that means companies can absorb less leverage. The leverage in our new deals peaked in 2020. It's been coming down ever since, currently below 5x. And further, when you look at loan-to-value, again, that risk has actually shifted towards the equity. Our loan-to-value for the past two years has been below 40%. So to wrap things up on the direct lending side, on behalf of myself and Kort, we're really excited about the market opportunity ahead. After these sessions in the break, you'll have a panel on the next frontier. Well, actually, we think we still have a lot left to go for as well in a $7 trillion market, where we believe we are the best-resourced manager with nearly 300 dedicated investment professionals and over 700 underlying businesses through incumbency that we continue to lend to. We'll continue to raise funds to address these markets in the future and believe that we have a really, really nice road ahead of us. So with that, I'll hand it over to my partner, Joel. Thank you. It can be a little intimidating to come after behemoths and market leaders of European and US direct lending. What's a lot more intimidating is when you're standing off stage and your target goes from $70 billion to $100 billion, to Mike Smith's $300 billion. So with that, we'll begin on a little overview of alternative credit. Ares Alternative Credit, it's called many things by others. It's called asset-based finance or ABF. It's called asset-based credit or ABC. We look at it as every investment we make is a credit-related investment. We're not doing just financing assets, we're making credit-related underlying assets. Everything's a portfolio. It's a portfolio of loans, leases, and receivables. It's also a portfolio of contractual cash flows. We are investing with a particular view in mind. We are generally looking across those from a relative value lens as we continue to invest. At its simplest basis, we lend, we own, we invest in liquids. And as we'll go through this and we talk through our different pools of capital, we've built our capital to be balanced. We've built our capital to grow with balance, both across the liquid or the rated part of our markets, both public and private rated, as well as across the illiquid or direct originated, similar to what you see across other parts of direct lending and opportunistic credit. And so as you look at our team, we have a large, established team, one of the largest teams in the space, over 70 investment professionals. But just as importantly, we have a very senior team. We've been doing this for an average of over 20 years for half of us. My partner, Keith Ashton, and myself, have been doing this for over 25 years. We have a long track record in this space. This is not an area that's newly discovered for us. This is an area where we have this established track record at Ares alone since 2011. The thing we're most proud of, as you can see on stage, over $45 billion of invested capital, just barely a hair over 1 basis point of annualized loss rate. That is what attracts capital, that is what attracts scale, that is what continues to grow the flywheel that Mike talked about earlier. So as we grow, as we've grown from 2018 to 2024, we've remained balanced and will remain balanced from here. You touch our markets every day. We talk about these portfolios, we talk about loans, leases, and receivables. When you leave your house, drive your car, stop at Starbucks, go to work, you're creating contractual cash flows with residential mortgage. You're, you're driving your car with an auto lease or an auto loan. You're using unsecured consumer loans. You're using credit cards. You're streaming Netflix, you're streaming Spotify and others. All of those create those contractual cash flows. All of those create those portfolios of assets. That is why our world is so big, $28 trillion, and we're just starting to scratch the surface. This is a market that was consolidated in the pre-GFC days with your GEs, CITs, capital sources, and some of the banks. It became more fragmented. We've been, since 2011, the largest consolidator in this market, and we continue to press our advantage with regards to that scale. Our biggest advantage we have is sitting on this platform. If you think of our platform we sit on today, we have partnered with everybody you'll see on stage today. We have partnered with them, and it's, it's this collaboration that really drives not just our business, but but drives all of Ares. 'Cause when you think of our partnership with real estate against diversified portfolios of net lease or single-family rental, when you think of our partnership with infra debt and infra equity across digital fiber, Or digital assets such as fiber and cell towers and data centers, that ability to bring flexible capital and scale, whether it be in the rated part of our markets, whether it be in the unrated part of our markets, directly sourced, that is what allows us to stand on the shoulders of giants and do what we do. What we've done is we've raised capital that meets the opportunity set. When you think of the opportunity set, that $28 trillion that sits out there, the key is having balanced capital. The key is not being overweighted to just insurance solutions. The key is sitting there and being able to drive something where you'll have returns across the return spectrum. As you can see on screen, we have capital that's raised in scale across insurance solutions. About half of that is in partnership with Aspida, and we will continue to grow with Aspida, but we'll also continue to grow with our third-party insurance clients. We have capital on the other end of the spectrum with Pathfinder, and as we sit there with Pathfinder, we have the ability of relative value to rotate across these asset classes of lending, owning, and also playing in liquids, but with that relative value lens. In the middle, maybe one of the biggest opportunities is the core strategy. Because if you look at the core strategy with similar return spectrums of what you see across the direct lending or other assets, it's a massive world. That ability to bring that capital and bring capital that's also unique from the standpoint of being open-ended versus Pathfinder being close-ended, that entire thing, the opportunity set, meets the capital that we've raised and continue to grow. Why? Why do we raise that type of capital? Why have we raised the capital we have? We've talked about quality AUM. At its simplest, Keith Ashton, who you'll hear from later on the panel, always says, "I can never finish an example or a speech without talking about food in some form or fashion." So the recipe, as you've heard here today, for alpha is simple: origination plus relative value. That's alpha. And so the more we originate, the more that we bring relative value to the table with a little bit of sprinkle of information edge, that flywheel, as we've talked about earlier, that alpha creates that growth. That alpha brings quality AUM. So as much as we will scale our insurance solutions, and that's a massive opportunity, as much as we will scale core, we will also scale Pathfinder. So that ability to bring that capital is the key to our business. If you look at relative value, it's interesting because a lot of people will look at this slide, and they'll say, "Look at all of the different categories of assets, from real assets to transportation to consumer and other." It actually is even larger than that, because if you look at any individual asset on here, if you think of residential mortgage, we do residential transition lending. We do whole loans in the non-QM space. We invest in mortgage REITs with regards to preferred equity and convertibles. We have the ability to acquire assets. We have the ability to invest in assets. We have the ability to lend against those assets. So that ability to rotate and net lease, where we're doing lending as well as arb strategies, as well as the deal we did two years ago with Capital Automotive for $3 billion, that brings that scale. So we continue to press our advantage. We continue to have that competitive advantage as we grow, and it's showing in the numbers. As you can see, the growth we've already had to this period and the 6.3x growth we've had to 2023, we expect to grow from here. We'll put $70 billion on a page. I, I will not go to Mike Smith's number. But we also do it with purpose. You know, six years ago, I went to Mike Arougheti, back in the hair gel days, with an ask, which was, "You know, we want to be able to tie what we do in with purpose." And when you think of that purpose, we have also been pathfinders with regards to combining not just alpha, combining not just relative value, combining not just great results for our investors, but doing it with a charitable tie-in, where at least 10% of our flagship fund with Pathfinder and Pathfinder II we just raised, as well as our core strategy with a 5%, having having that go to global health and global education charities and inspiring the broader Ares foundation that we have today. It's one of the best things that I've ever been involved with. It's the reason, as I've tell Mike all the time, I will never retire, but it also drives the culture of what we have, and it continues to make us a preferred counterparty. So in closing, a long track record, a 1 basis point annualized loss rate, scaled capital across the opportunity set, a balanced approach with our partners and with our capital, a huge tailwinds across what we have in asset-based credit from banks and insurance, as will be covered later today, all while investing with purpose. The future's bright. Good morning, everyone. I'm Aaron Rosen. I am the co-head of opportunistic credit with my partner, Craig Snyder. Really excited to be with you here today. This is a very exciting time for the opportunistic credit business. I'll spend a few minutes talking about where we are today, the market environment, why we think it sets up so well for the product and the platform that we've created, and then where we're headed. The origins of our business really started back in 2018. It's a special-- It was a special situations business, and I'll talk in a moment about how the markets have evolved as you think about stressed and distressed product and market dislocations. When we first started, we effectively inherited a public market trading business that sought to capitalize on market dislocations by buying distressed securities. What we've done over the last six years is really evolve that product to one that has become a true all-weather strategy, capable of deployment in both good times and in times of dislocation. Today, we manage $14.6 billion across the opportunistic credit funds. We've deployed $12 billion in funds one and two. We have 30 investment professionals in New York, London, and Los Angeles. And our returns here, 22% gross and 17% net, we believe are, are, are amongst the best out there in our industry. We also have a quite low loss ratio of 0.1%. I was quite proud of that until I heard some of my partners speak before me and, but 0.1%, we'll take with the relative risk return that we think we're delivering. So what we've done here over the last six years is really create, again, a scaled platform capable of deploying in both dislocated and healthy markets. We perform deep private equity due diligence. We identify themes in the marketplace. We go and attack those themes, and we deploy effectively through the very strong sourcing engine that Ares has. Here, I'll talk a little bit about what the legacy stress, distress, special situations funds look like versus the Ares opportunistic credit business that we've created. Again, legacy public market deployment focus can find yourself adversarial to a sponsor and to companies.... difficult to execute at scale. The illiquidity in the public markets is, has gotten a lot of attention. Dealer desks are not carrying a lot of inventory. The street research coverage isn't there, and that lack of liquidity, has further exacerbated, the volatility in those markets. Finally, you hear a lot about creditor dynamics in the current market negotiations where liability management and debt discount is around the corner and putting creditors in tough positions. The product we've created, we believe, is simply a better way of pursuing the stressed and distressed markets, and also lending into over-levered, healthy companies that just need more time to execute in a higher for longer interest rate environment. We can deploy consistently across market cycles. We're in control of our destiny, and we have a partnership orientation with the firm sponsor clients. So this is what it means by the numbers. The top part shows our deployment across the last six years. So importantly, again, consistency. This enables us to achieve what we call vintage diversification. You've heard these themes about sourcing funnel, relative value. What we try and do is simply identify the best relative value in any of these market periods: healthy prior to the pandemic, the dislocation during the pandemic, obviously, we were healthy again, then we have a bout of inflation and the interest rate hikes, and now we're healthy again. The healthy market we're in today, I would argue, is a lot easier for us than it was the healthy environment back in 2019. The economy is strong, but obviously, the higher base rate is a big tailwind for our business. The profits that we've generated, you'll also see, are evenly distributed between dislocated and healthy environments. So again, this is a strategy that's generating the types of returns that our LPs expect of us, and not reliant on a market dislocation to do so. So what is our addressable market? It's quite large. I would actually argue that this, this page, doesn't even do it justice, because some of the opportunities we're actually financing today are for companies that are just looking for growth capital. When you think about the problems many companies in the middle market face, it's the ones we've been speaking about. Too much debt, higher interest rates cause problems with interest coverage, sponsors are having trouble returning capital to their LPs, and growth is more expensive to fund, again, because cost of capital is higher. So when you put all that together, the opportunity for us with a scaled platform to provide credit instruments with equity upside into those companies today is very, very large, and we are scaling rapidly. So in terms of where we go from here, again, the opportunity ahead is very significant in this particular current market. We see very distinct competitive advantages as a function of being on this platform. We have the sponsor relationships, we have the team, we have the track record. We're focusing on attractive risk return in any market environment and deploying consistently, again, giving investors that vintage diversification and the stability of the higher return product without relying on a market cycle. And again, we're participating in a very large and growing opportunity set. And with the current market environment of where rates are, with maturities and the need for capital be returned, we're incredibly well positioned going forward. So, you'll hear from my partner, Craig, on a panel going forward, but we're very excited here for our opportunistic credit business, and I will turn it over to my partner, Edwin. Thanks, Aaron. Hi, good morning. I'm Edwin Wong. I joined the firm in 2020 as part of the acquisition of SSG, a firm I co-founded over 15 years ago. Today, I have the honor of sharing with you the size of the opportunity set in Asia, how we position around it, and the outlook going forward. As all of you would know, Asia represents a large part of the global economy. If you just look at the top five countries in the world by the size of the GDP, three of them actually resides in Asia. Equally important is the growth that lies ahead. In fact, just this year alone, the estimate for 2024 is that Asia Pacific region will contribute to over 60% of the global growth. And by definition, growth is gonna be largely funded by debt. So what we're seeing is significant tailwind supporting the asset class in our region. If history is any guidance to us, what I've shown here is obviously the significant growth that we've seen in the development of the private credit market, starting with the U.S., significant CAGR over the last 20 years. A lot of people said Europe, it's roughly 10 years behind, you know, fantastic growth. If Asia is to follow that pattern, the outlook is somewhere in the next 5-10 years, we will get to this, the scale of the European private credit business. So how we position around it? We believe today we have established a leading credit platform in the Asia Pacific region. We currently manage close to $12 billion. Hopefully, the map will give you a good sense of the, the scale, the breadth and depth of the platform that we have created already today. Close to 230 employees across the region, over 12 offices. What that represents is having senior people on the ground to originate, structure, and manage risk on behalf of our clients. Significant track record, histories, relationships. Take India, for example, a country that many people are excited about, and we are as well about the outlook. We've been in there, in that country, you know, for, for close to 20 years, where most of our peers, you know, it's really 2-5 years max. On the right, the strategy that we focus on, special situations, our version of the opportunistic credit, something that is cycle tested, dating back to the Asian financial crisis in the nineties. Our senior lending flagship, what we call ACAP or Ares Credit Asia Pacific, focuses on direct lending and asset-backed opportunities in the region. And we also have a direct lending, a strategy that is focused on Australia and New Zealand. Direct lending is something that is a core product of the firm. Happy to inform that the sponsors are very, very active in Asia Pacific. Over 600 active sponsors to date. We cover the top tier of that market, 125 of them. You know, many of them in partnership with our colleagues in Europe and U.S., so it's really a collaborative effort. We believe we have a market-leading position in the market already, having done close to $2 billion of transaction just in the last 18 months alone. Similarly, asset-backed, you just heard Joel talk about the opportunity set. We are very focused on developing that market in the Asia Pacific region as well. Folks anchoring that off by a team sitting in Australia, in Sydney, Australia. We expect that market to grow to other countries in the region. So what's the outlook? Number one: continue scaling the existing strategies that we have. We think there's a lot of growth left. Again, we talk about the tailwind. We talk about the sharp CAGR. In fact, as a market leader in the region right now, we expect the CAGR to be, you know, much better than the market average. Permanent capital. You've seen the development of BDCs, both in the U.S. and Europe. I think it's a matter of time that we will create our Asia version of that in the region. Local currency. So far to date, what we have been investing is really taking U.S. dollars from our LPs and investing in our region. There is actually a very significant opportunity to manage local currency for many of our investors in the region. Take insurance company, for example, they earn significant premiums in local currency. So the opportunity set to create a private credit solution for that client set to invest their local currency back into those countries, it's a very, very significant opportunity that we're looking to capitalize on. And again, if you look at the map that we've shown before, we're one of really the only house that have capabilities in all those different countries. So I hope you are as excited as we are about the outlook going forward. And with that, I think we're due for a 10-minute break. Thank you. I've been down the darkest alleys, saw the dark side of the moon to get to you, to get to you. I've looked for love in every stranger, took too much to ease the anger, all for you. Yeah, all for you. 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So I'm hanging on tight, trying to keep it all tied together. How do we make this heart beat on and on, and on, and on, and on? How do we make this heart beat on and on? And on, and on, and on, and on. How do we make this heart beat on and on? How do we make this heart beat on and on? How do we make this heart beat on and on? Playing till my fingers hurt, writing till I find the words. Oh, oh, oh, oh, oh, oh, oh, oh. You know I got your number, number all night. I'm always on your team, I got your back, all right. Taking those, taking those losses if it treats you right. I wanna put your game into the spotlight. If the world would only know what you've been holding back, heart attacks every night. Oh, you know it's not right. I will follow you way down wherever you may go. I'll follow you way down to your deepest low. I'll always be around, wherever life takes you. You know I'll follow you. Call you up, you've been crying, crying all night. 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I said one day this world will take you down, and oh, it can swallow you whole. I said one day, oh, boy, you're gonna drown. I don't- Y'all came back? Thank you. My name is Keith Ashton, the Co-Head of Alternative Credit with my partner, Joel, who you just met. We're talking in this session about frontiers of private credit, and we don't mean by that this is new things. As you'll quickly surmise, these are asset classes that have been around a long time. The frontier element, however, is because in each case, which you'll hear about, we've hit something of an inflection point in both the market opportunity and growth opportunity for Ares. So that's what you should be listening for. I'll start, and then I'll pass the clicker over to my partner, Craig, and then Patrick, and then Brian, you'll. I guess you'll bring us home. Sounds good. All right. Great. As you heard, my partner, Joel, discuss, alternative credit is a very large market that has a host of credit products that are used every day and underpin a lot of activity in the economy. One of the things that you should really understand is that the foundation of this market, a capital foundation of this market, is consists of three main pillars. The first of these is banks. Banks are by far the dominant pillar of capital in this market. Then there is the asset-backed securities or securitization market, which transforms these asset portfolios into rated securities for institutional investors, primarily, and especially insurance. Then private capital, which is a complementary pillar of capital that provides capital solutions that the other two pillars either can't or can't easily provide. But these pillars of capital are highly symbiotic. We all need each other, and the asset markets themselves need all three pillars to function properly. There's a long history in these markets, and that history is defined a little bit by how these three pillars shift in terms of their relevance and activity relative to one another. And without going into the whole history here, you can think about the last 5-10 years, where the private capital pillar has played a much more significant role than in the past, because banks and securitization markets emerged out of the GFC, feeling more constrained. What's interesting is that the markets find these new balances or new equilibrium. As we look at the market today, there's been some recent events that rhyme with banks that have created, again, another situation where these markets are gonna find a new equilibrium among the three pillars. We refer to this as the $12 trillion question. As we know, and won't belabor, banks are facing two distinct challenges today in the market. One relates to their liabilities. Their liabilities are more expensive today, especially for their deposits, and those deposits tenor, in particular, is less certain, shall we say, and I think everyone agrees, is a little shorter than it used to be. And then on top of that, bank regulators are increasing the amount of capital that banks have to hold against these same kinds of assets. The $12 trillion number comes from the fact that if you look inside of bank balance sheets today, $12 trillion is the amount of assets that they have on those balance sheets. The same assets that are financed, owned, and invested in by the securitization market and private capital every day. So while banks will continue to play a very important role in this market, what's interesting that we see is that as these constraints, are, and challenges are facing banks, the banks have to respond. They, they really don't have a choice in the matter. They have to recalibrate their balance sheets. So the $12 trillion question ultimately is: What percentage of that $12 trillion worth of assets is gonna need to find a new home in non-bank capital, and particularly private capital? This is why we think that, for now, for the next 5-10 years, there's a bigger role for private capital to play in these markets. The good news is that Ares is really well-positioned and, well-resourced, has the ability to participate in that growth, and, and what we think will be the driver of alternative credit growth at Ares for the next 5-10 years. So with that, I'll pass the baton to Craig. Thank you, Keith. So I'm gonna start a little bit and talk about the opportunistic credit market opportunity today. As Aaron, my partner and colleague, mentioned before, our mandate is quite wide, and we like to think the definition of opportunistic credit today is effectively this wide highway that we can drive in between in corporate credit. On one guardrail, you have traditional distressed investing, which is much more episodic in nature. On the other side is traditional direct lending, and, you know, and our deals tend to be a little bit more complex in nature, take longer, more bespoke in nature. So we have this wide highway to drive through within corporate credit, depending on the market opportunity, dislocations or healthy-performing, non-performing companies, and we have the ability to kind of ascertain and use relative value in the platform to our advantage to get what we think is differentiated deal flow and investment opportunities. But I'm gonna focus today on the market opportunity that we're active in today, and that's specifically dealing with aged assets on sponsor portfolios. And given the higher interest rate and volatile market environment, exiting assets and returning capital for sponsor-owned companies is very challenging today, and the PE community at large has an aged asset issue that they're dealing with. When we look at the chart here on the left, what that means is, effectively, you see around 51% of sponsor-owned companies, and this is on a global basis, it's around 16,000 companies, over 31,000, have been aged, are sitting on sponsor portfolio companies 4 years or more, some even longer than that. Usually around years 3, 4, and 5 are when assets are starting to get sold back into the market, so it's creating this aged asset issue, and it's effectively the result of these three monetization paths, or I like to call off-ramps, being effectively shut. You know, in 2018 to 2021, in a low-rate environment, when cost of debt was much cheaper than where it is today, you saw a lot more frequent sponsor-to-sponsor transactions happening. That was a huge tailwind. That tailwind is now a headwind. As we know, rates have doubled. The cost of capital has doubled, I should say. Rates have gone up, and multiples have come down. So as a result of that multiple compression, you see a wider bid-offer spread. Buyers want to buy at today's value, sellers are up here pre-rate hike, and so you've seen a stagnation of sponsor sales within one another. Two strategics are coming back, but not as quickly as you would think in the harder regulatory environment, and there's only been 14 sponsor-backed IPOs since 2022. So effectively, these three off-ramps remain severely challenged. And effectively, when we turn to the next page, this aged asset phenomenon, like, that we like to say, is effectively our pipeline, and it's our opportunity set today. As you see here, there's around $3 trillion, over $3 trillion of global unrealized NAV, i.e., sponsor capital, that's been put into the ground and spent over the last few years, versus only $1.2 trillion of dry powder. Historically, throughout my career, most of our careers, that ratio has been effectively 1-to-1, and that's kind of kept the PE machine rolling. But when you see this imbalance. This deficit of 60%, sponsors have to ask themselves specific questions what they want to do with their capital, and there's three specific things that they're doing the math on to get to the right outcome. They can defend existing positions, but that could be at returns that are potentially dilutive to their original underwrite. They can do new deals, but that would deplete that capital balance, or three, they're coming to us, and they're coming to us as a solutions-based provider, where we can kind of come in, partner with companies, help companies unlock enterprise value, de-leverage balance sheets, recapitalize balance sheets, to where a sponsor is willing to say, "I will effectively trade IRR today for duration extension tomorrow for a better equity return," when those three exit paths come back to the market. So we're seeing a lot of opportunity on this installed asset base, as the market continues to kind of digest a higher rate environment. When you look on the next page, this kind of just juxtaposes the two environments when rates were low. You know, in addition to aged assets, you know, we also think the refinancing opportunity for both publicly traded companies and sponsor companies will be with us as well in this higher rate environment. Remember, we're at, you know, 4.5% right now. Even in a lower rate environment, call it 3%-3.5%, this opportunity will be with us for the foreseeable future. Where you see on the left, you know, when rates were low at 6%, cost of capital for an LBO, fixed charge coverage ratios were rather healthy, around two times. Cash flow could be reinvested back into the business, and you could grow organically and/or do M&A, and that was, you know, usually how companies were able to exit and grow EBITDA from that perspective. Fast-forward to today, cost of capital has doubled. That 6% floating rate note usually is now coming due. It needs a refinancing opportunity. And as you can see here on the right, in this refinancing example, you can get around 4 turns of debt, roughly, a lower quality of the debt, but at that higher rate, and there's a 3.5 turns of a capital need that we can kind of come in to kind of fill that void, really partner with these sponsors, where there's strong institutional equity support below us. Yet we believe really attractive returns, very good downside protection in terms of how we structure these types of deals, and really be that partner to help refinance these capital structures. So we see this opportunity set, you know, with us now in the foreseeable future in this type of environment, and we're excited about all the opportunities that are coming to us. So with that, I'll pass it over to Patrick to talk about the exciting opportunities in infra debt. Great. Thank you, Craig. Thank you, Keith. Firstly, like, I'd like to open up and introduce myself. I'm Patrick Trears, the Global Head of Infrastructure Debt at Ares. And at Ares, we have a true global infrastructure debt platform. We have an office in New York, London, APAC, but that drives, you know, as you heard from my colleagues today, really strong origination, and we're able to support our sponsors all over the world. But across the infrastructure credit space, we believe this is a pivotal moment in time. There are three mega trends that are driving this opportunity set. Across those mega trends, and you heard from Mike today, look, this is not a market that we can measure in billions. It's a $1 trillion market opportunity, and that annual spend is increasing year on year. At Ares, we're at the forefront of that, having that true global presence. Across the mega trends, we see energy transition, we see digital, and we see transport and mobility. Across the energy space, you know, we're seeing the shift from fossil fuels to more sustainable energy. Across the digital space, that's really driving data centers, data consumption. You know, we're seeing the huge shift, as we all spoke about here, and think about AI. You know, that's creating the data centers at the epicenter of our daily lives. You know, across the transport and mobility, I think what we've seen over the last few years is that we've seen, you know, increased demand for people moving and goods. That's, of course, airports. But just capping off on the mega trends, the digital revolution is upon us. I think when we witnessed the introduction of the internet many years ago, but now we're seeing the introduction of the data consumption. And what does that mean? That really creates enormous opportunities for Ares. Ares to be a capital provider and capitalize on this huge opportunity in the infrastructure space. I think, you know, shifting across, I'd like to really speak about the capital dynamics and sort of point out two key observations that are driving this funding gap. Infrastructure equity funds have got larger. There is shortage in credit. Government budgets remain stretched, and the spending capabilities across the world to fund this infrastructure spend, which is expanding on the funding gap. Equity funds have raised over $1 trillion versus $100 billion on the credit side. So, you know, just by nature, credit funds should be 3x the size of an equity fund. So there's a scarcity in credit, and that's real, and at Ares, we are ideally positioned to work on this market. Across our pipeline, you know, just to speak to that, we've got $5 billion in credit opportunities. And on the government side, we're seeing the rising rates across the world. That's putting pressure on governments to keep up with their debt balances. And so it's estimated in the U.S. that about 50% of the federal tax receipts will be used to fund their basically existing debt. So there's a huge capital demand for infrastructure, and at Ares, we're nicely positioned to be that infrastructure capital solutions provider. You know, look, as we see the growth, you know, we don't see this slowing down anytime soon. This is a market that's gone from strength to strength. You know, the chart on the right-hand side will show that the M&A activity has slowed down, yet our pipeline of activity has not slowed down. This opportunity set has really been driven by three items. They are refinancings, growth CapEx, and recaps. But just across the growth CapEx, as we look at the data center and the whole digital revolution that's underway, we're at the forefront of that, financing all of these opportunities. But just to sum it all up, it feels like we're just at the tip of the iceberg here. There's huge opportunity here in the infrastructure space, and we're seeing that investors are... It's a flight to quality as they back these infrastructure assets that are critical to the economy. But with that, I'd like to pass on to my partner and colleague, Brian Donohue, on the real estate debt platform. Thank you. Thanks, Patrick, and thanks for the time today. Grab that clicker from you. Yeah, it's tough to bat cleanup here, but I'm gonna try to walk through real estate credit without being overly redundant, with two exceptions. One is, I think my colleagues up here today, we share the scale of the opportunity set in front of us. It's unabashed, and we're excited about it. We have a huge addressable universe, and, and real estate debt is a proxy for a lot of what we're talking about, given the manner in which it has been historically financed. Now, normally, real estate gets into the headlines based on the oversupply of underlying assets, right? That was the GFC, that was the S&L crisis, and we sit here today, somewhat uniquely, with the fundamental backdrop away from the office sector, undersupplied, long-term, positive supply-demand fundamentals in logistics, in housing, in the U.S., and in Europe. So if you look at the way this asset class has been historically financed, largely, banks have been the dominant player. And Keith touched on this earlier, as well as his colleague, Joel, about the way those liabilities and assets matched up. And so what's driving some of this change? We talked about some of it from a secular perspective, but office exposure, right? If you look at private versus public exposure to the space, and that is the one subsector where there is oversupply, well-publicized headlines there. The office exposure becomes this capital drain, both in terms of human capital, as well as financial capital. So when you pull both of those back, alongside the regulatory framework that we're all sharing today, it creates a vacuum of capital. Now, when you add to the equation the increase in rates that we've seen over the past two and a half odd years, it hurts the liability structures, and certainly it hurts the asset values. And so that vacuum of capital leaving the system creates this wall of maturities that's been characterized, $150 billion annually of maturities that will have to be refinanced by someone other than their legacy holder of those assets. You may have seen this in the press around a refinancing wave. The connotation of the wave, the way it's being expressed, is that it's a one-time event. And Patrick, you touched on this a little bit. This is not a one-time event. This is a long-term secular shift in the way these assets are leveraged. It's not that the banks are leaving our space. Quite the opposite. You hear us at Ares talk a lot about the partnership that we have with the banking institutions across every part of what you've heard about thus far today and for the rest of the day. The banks are being encouraged and taking the bait to shift into levering the private providers of capital in our space, and it's a positive change overall for the overall that same supply and demand dynamic. There's less supply of capital to commercial real estate today. We have the benefit of the increased rates. We have enhanced pricing from the spread increase because of that vacuum of capital that exists. But I think an important point that may be a little bit subtle here is private lenders in commercial real estate debt are less levered than financial institutions historically were. So with that reduction in leverage, right, a de-leveraging cycle that started with REITs 20 years ago, lower LTVs in public REIT sector, the commercial real estate market will benefit from the lower leverage that lenders will apply to the sector going forward. But the benefit, right? We talk about compound income ad nauseam here at Ares and the benefits of it, but if you look at what's going on, what the offensive side of the ledger looks like today, it's higher base rates, reset valuations, better covenants, and overall better yields. One of the more compelling opportunity sets that I've seen within my 25-year career. I see the time ticking down. Hopefully, we did a good job of covering what is a vast opportunity set that we see throughout Ares and for the four of us on the stage today. With that, I will turn it over to my good friends, Julie and Keith, for the next section. Thank you, everybody. Good morning! I'm Julie Solomon. I'm a Partner and Co-Head of the Ares Real Estate Group, and I will be joined shortly by Keith Derman, Co-Head of Infrastructure Opportunities. Today, we will be giving you an update on real assets at Ares. We'll touch on what the business looks like today as the second largest business at Ares, and we'll talk about the drivers of our continued growth. Today, Ares Real Assets comprises roughly $64 billion of AUM in the U.S., Europe, and Asia. We invest up and down the capital structure as owners, operators, and lenders to real assets globally. Keith and I represent a very large team who are cycle-tested, who have been investing for decades, and who are local in the very large addressable markets where we invest. We've experienced a lot of growth in real assets at Ares. We've grown over 32% over the past 5 years, since 2018, and that has come primarily from organic growth. Our assets have performed, we've been successful at fundraising, and we've made 2 strategic acquisitions in each, one in each of our businesses. The first, Mike talked about earlier today, which was the acquisition of the Black Creek Group in 2021. Black Creek brought numerous capabilities into Ares, including being one of the largest owners and operators of industrial in the United States. And then in 2022, Patrick and the team joined us. We acquired AMP Capital, one of the private credit leaders in the infrastructure market, and that business has continued to thrive. We believe the scale that we have grown to, our team's reputation in the marketplace, and the track record and the results that we've delivered to our clients has differentiated us in the marketplace. Now, to capture the benefits of the scale that we've created, we have a platform that resembles much of what you've heard about today. We want to be a full solutions provider, and we have built out strategies to do just that. We think that brings three key benefits to both real estate and infrastructure. The first is that it allows us to have the most relevance in the markets where we invest. We are a preferred counterparty, and that brings a large set of opportunities into the firm, and then we're able to assess relative value and where we want to be in the capital structure, the capital that we manage. And thirdly, it provides us a suite of strategies that we can deliver to our institutional and retail clients globally. So now I will spend a few minutes talking about real estate specifically, and then I'll hand it over to Keith to talk about infrastructure. So real estate today at Ares encompasses just about $50 billion of AUM. Also, significant growth within our real estate business. We have grown through organic efforts. Again, asset performance, even in the market environment we've been in, and fundraising that we have attracted. Just as Tony said earlier, I will echo, assets follow performance, and that's what we've achieved for our business. And what we look to do is to be able to deliver the widest set of opportunities in the real estate group as well, and we've done that through our growth. I'm proud to say that three years into the just approaching the anniversary of the acquisition of Black Creek, we are now the third largest owner and operator of industrial in the United States, and a growing and similar footprint in Europe. Our private real estate debt business that Brian Donohue talked about and manages has tripled in the U.S. and Europe over the past five years, and we are a top three alternatives manager for non-traded REITs. So we have seen the success in our business, and importantly, we have experienced this success through what has been a fairly difficult time in the real estate market, and that's because we entered 2022 with resilient portfolios, heavily invested in multifamily and industrial, and we've invested in our people and our business infrastructure with over 270 people on the ground in 17 offices. We are a real estate group within a large global firm that has so much information coming in from the thousands of companies that are the tenants that reside in our buildings or driving the markets where we invest. All of that presence, all of those experiences of our people, has led to the construction of very strong portfolios. Today, roughly 84% of our portfolio is invested in industrial, multifamily, and adjacent sectors that exhibit very strong health dynamics, like student housing, like triple net lease, like single family. So importantly, we've concentrated in the right sectors today, but we have experience in all sectors. I want to pause on this page because this is what we have been building for: to have direct operating capabilities in our highest conviction sectors, but also to be able to reach into our long-standing network of JV partner relationships that are generating really strong sources of deal flow as well. Having the operating capability and our JV partner relationships and the additional investments we've made in companies that can provide us with that deal flow, it's given us better opportunities to select from. We have larger sets of data within our captive portfolios that allows us to underwrite better, and then we are able to deliver improved economics onto our clients. So you take the combination of sector expertise, the relationships that sit and extend beyond those 270 professionals, you marry that with structuring expertise that our team has developed for decades and decades in the industry. And what that allows us to do is to make investments that protect our downside during times of uncertainty, but also participate in upside as the market recovers. And that has really been the key to our success. And you can see here, I won't go through each strategy that we manage, but consistently have demonstrated strong performance against the comparable market equivalents across all of our strategies in the U.S. and in Europe, in our diversified sector funds and our industrial-only funds. And this is the result of having large, local teams on the ground, picking the right sectors, the right assets in those sectors, and in the right structure. That performance has led to growth in each of the strategies we manage. Our core, core plus funds, our value add, our opportunistic, and in debt, where we've seen a 29% CAGR since 2018. This all ensures that we are properly capitalized and to take advantage of the market opportunity that's ahead of us. It is a large market opportunity ahead of us. Real estate has a $20 trillion global investable market. $13 trillion is professionally managed. Even with our 30% CAGR, which has been very impressive, we still represent just a fraction of a large and fragmented market, and there is a lot of room to grow, and we have the capabilities to do it. As far as the market today and what is our view, there is still uncertainty in the market, but we believe there are signs of a recovery. We see it in our own pipeline, we see it in the assets we're bringing to market. There's more liquidity coming in amongst the traditional lenders, although on a very selective basis. There are buyers that are holding assets or funds that are facing loan maturities, hedge maturities, or fund maturities, and we're starting to see pricing bottom as buyers and sellers are converging. So what's in focus for us against this backdrop? It's very clear there are four areas of key focus for us. The first is to buy high-quality assets in supply-constrained markets that have repriced. No sector was immune to the past two years and the dramatic rise in interest rates, but not all suffered the same. Second, as you heard in the last panel, direct lending to real estate assets is a continued area of focus for us, and we believe we can lend on better quality assets and deliver better yields to our clients. Third, we are going to leverage our structuring expertise that has been bread and butter to the Ares real estate business for decades, and we will continue to fill the gap in capital structures for owners and sponsors who aren't able to access the same level of debt they could in the past because of the rise in pricing. And fourth is what we call generational assets. This is that once-in-a-lifetime opportunity where we can either buy or lend to assets that, because of the current market dynamics, we wouldn't be able to access elsewhere. Great example of that is a GBP 300 million senior loan we recently made to refinance two prime assets in London. One, Burberry's headquarters in the heart of Mayfair, and the second, the Hilton Kensington in central London. We were able to take advantage of the retrenchment of the banks and step in on a very large loan that in other market environments we would not have been able to compete on. So this is just a glimpse of what we're doing across the platform, yet we are always focused on growth. And for us, what will drive that growth is, first, maintaining our performance. We will continue to drive those results to our clients. Second, we will scale our current strategies. We have room to go. We have built the capabilities to deliver, and we believe we will. We will pursue new strategies that are complementary to what we have right now. We're excited about Asia. We're excited to continue to expand into segments of the market where we haven't fully built out yet. And if we do all this, if we maintain our performance, if we scale our funds, and when we pursue new complementary strategies, we will be able to deepen the relationships with the clients that we have, and we'll be able to expand into new channels to continue on this growth trajectory. So in summary, we feel Ares Real Estate is so well positioned in this current market backdrop, and we will continue to thrive as the market recovers. So I want to thank you for listening to us talk about the real estate group, and now I will hand it over to my friend and colleague, Keith Derman. I'll get that one. Great job. Okay. Good morning. I'm Keith Derman, Co-head of the Ares Infrastructure Opportunities team, and I have been with the firm for almost 10 years now, since we started a dedicated infrastructure platform back in 2015. The business is now up to $15 billion of assets and feels like we're just getting started. Should be a real big growth area for the firm. Now, I, I come to work every day incredibly proud of the more than 50 dedicated infrastructure investment professionals who eat, sleep, breathe, structure, finance, develop, construct, own, operate, and manage infrastructure assets all around the world. Today we have two dedicated infrastructure strategies: a go anywhere, do everything, or almost, maybe almost everything, global diversified infrastructure credit solutions business, which is run by Patrick, who you just heard from, as well as our equity strategy, which I oversee with my longtime partner, Andy Pike. That business is leveraged to the energy transition, with particular emphasis around what we refer to as climate infrastructure and green digital. Those businesses are quite a bit different as far as their strategies, but they provide the same exposure and benefits of infrastructure, which are real assets, long-term contracts, essential services, uncorrelated return, as well as a hedge against inflation. Now, within the AIO business, we've perfected what we call a value-add, flexible capital style of investing. We're focused on... We're focused particularly around the energy transition and the drivers of what we think of as the modern infrastructure of today and tomorrow. We're deeply tenured sector specialists. We love to develop and construct physical projects, but we also invest in what we think of as infrastructure growth equity into platforms, into companies that are looking to scale their own infrastructure portfolios. We also flex up and down the capital stack, looking to create portfolios that have capital appreciation, yield, and the all-important downside protection. The flexibility around how we invest, what we invest in, and where we invest really creates a large funnel for origination and makes us a solutions provider. Now, you heard from Patrick, but just a quick snapshot on the infrastructure credit business, also highly accomplished. It's a great platform, fantastic team. They provide credit solutions to all of the leading infrastructure sponsors in the market today, based in U.S., Europe, and Asia, and they do cover it all: energy, renewables, transportation, and digital. They provide junior capital, senior acquisition, bridge, unitranche, you name it, they, they can do it. And they have invested more than $12 billion historically, usually as a lead arranger or sole lender in a transaction. Now, Pat showed you this slide already. I wanted to show it to you again because I want to reiterate how just absolutely massive the capital needs in infrastructure are. It's staggering. It's actually almost funny money sometimes when you start to use the word trillions. But I wanna emphasize that the megatrends that are supporting this capital need, they're really both overlapping and self-reinforcing, and from our perspective, that creates a chain reaction of investment opportunity, and our expertise in these areas really position us for success and for growth well into the future. Now, I just wanna dial in for a moment around the equity business at Ares. About five, six years ago, we redirected our focus around climate infrastructure and green digital. We did that because we found that they were the most attractive, most compelling segments of the asset class, and there's really four principal attributes that I think make them the envy of other segments of infrastructure. Number one is the capital intensity of this sector. I pointed out those numbers for you already. The second is the high growth nature of these asset classes. Year over year, there's more dollars and more dollars, more demand for these projects, for these companies coming into service. The third is the durability of these megatrends. It feels almost permanent. It's hard to imagine that in the future, digitization and decarbonization are less important than they already are today. And then finally, resilience. These assets have long-term contracts. They have credit-worthy counterparties. They have fantastic, uncorrelated return. Now, I just wanna give you a quick flyover on the two most recent infrastructure funds. We have Ares Climate Infrastructure Partners I, and we have IDF V, which was the largest in the credit fund series. Both are fully committed today. Both are targeting at the high end or above their target return expectations. I know that Andy, Patrick, and I, and all the other partners are very, very proud of this performance, but we're really just pleased with the underlying asset quality that we've been able to compile into these funds, and I think that's a function of the asset class, the strength of the asset class, but also the experience and the capabilities of our team. So where are we gonna go from here? We're $15 billion today. We are primed for growth. We're gonna do it a number of ways. We're looking to expand the business geographically. For AIO, that means Europe in the near term and Asia as well. For IDF, that means increased focus on Asia, as well as the developed areas of LatAm. From a sector perspective, it means that we're gonna follow the energy transition into other segments of infrastructure, and we're gonna lean in around climate and digital, as I think you heard from Mike and others communicate earlier. And then finally, as far as products, on the equity side, we will be looking to expand into the core and to the core plus markets, which, combined with the infrastructure credit business and AIO, gives us over 1,000 basis points of return opportunities within infrastructure. So, thank you very much for letting me give you a quick snapshot into the infrastructure business at Ares, and with that, I'm going to invite a gaggle of secondaries professionals up on the stage to talk about their expanding business. Thank you. Good morning. My name is Michelle Creed, and I'm excited to be with each of you today. I'm also delighted to be joined by three of my friends and partners, Eddie Keith, Nate Walton, and Dave Schwartz. This morning, we'll walk you through an overview of our platform and our market, and we'll also share with you some of the exciting growth opportunities that we're seeing today. First, I'll start by saying who we are. Our team consists of 80+ professionals dedicated to the secondary space. Our team has been investing in secondaries now for more than 30 years, and in the last 3 years since acquisition, we've grown our assets under management by more than 30%. Our private equity team, seen as a pioneer in the space, should also be noted as an innovator, an innovator of creative liquidity solutions. And our real estate and our credit secondaries teams, they're the standalone leaders within their markets. This is measured both in terms of assets under management as well as dedicated investment professionals. In our infrastructure secondaries team, this team is one of the top players in the space and continues to be seen as the player for structured solutions today. Now that I've talked about the who, let me talk about the how. How do we execute on secondaries on a daily basis? It really comes down to access. It's access to sourcing, it's access to data, and it's access to capital. As we think about the sourcing side, our ability to have conversations with groups in the market on the brokerage side that we've been speaking to for years is really important. It's what provides us with the ability to get that first and that last look in a portfolio transaction. And now, our ability to have conversations with the more than 2,000 Ares LPs and our internal colleagues of more than 1,000 investment professionals, that's what enables us to have not only differentiated deal flow, but directly negotiated transactions. And it's access to data. We can leverage the more than 3,000 portfolio companies that Ares invested in, as well as the nearly 290 million sq ft of property globally. That data enables us to not only efficiently underwrite portfolios, but also to intelligently construct a bottom-up analysis. As we think about access to capital, with four discrete pools of capital and the ability to stretch across the platform, we can really be that one-stop shop and that one-stop solution provider in the secondary market today. So I've talked about the who, I've talked about the how. Let me talk about the what. What have we been able to achieve over the last 30 years? You've heard today that performance is really key to future success. And so take a look at the numbers on the screen. These are our since inception returns, and we couldn't be more proud of them. Our ability to buy seasoned assets and to buy these assets at discounts to their intrinsic value, that's what enables our team to be able to produce this level of returns for our investors historically. And as we look ahead, recognizing that we've generated gross IRRs north of 20% across each of our established businesses, I can't be more excited to see what the future holds. So with that, I'll turn it to Eddie, who will talk about the markets. Thank you, Michelle. So I've been investing in secondaries for about 18 years. Our industry has been notoriously bad about underestimating its own growth. And I think the reason for that is you usually get the definition of secondaries wrong. For a long time, people thought, thought secondaries was a specific deal type. Secondaries is actually, it's a suite of solutions. Secondaries is the market-based solve for the constraints and challenges associated with investing in private markets. You keep that definition in mind, you'll know where secondaries is going, and you'll know where the growth is coming from. So let's start with the first constraint, the 10-year fund life. There are plenty of reasons an LP needs to get out of a fund before that 10-year period. And secondary solution for that was the LP trade, and very well understood at this point. Private equity, I'd argue that that market is mature, but just because it's mature does not mean it's not gonna grow. If you look at the amount of capital that's locked in the NAV and unfunded and private markets, it's about $3.8 trillion. Secondaries, about 2% of that volume is gonna turn over annually. So as that $3.8 trillion grows to $4.5 trillion-$5 trillion, secondaries is gonna grow with that, even in the most mature market. But what gets really exciting is when you look at the right side of this, this page. Real estate, infrastructure, credit, not only would that secondary market grow as more capital goes into those markets, but these markets are not mature, nor close to mature. You haven't hit that 2% turnover rate like you've got in private equity. So not only are they gonna grow as the asset base grows, they're gonna have a turnover rate that moves closer to that 2%, so you can have a doubling just from that, coupled with the growth in the asset class. It's, it's not a coincidence that Ares has invested heavily in these high-growth markets. As Michelle mentioned, we are the market leader, the largest in terms of AUM and team, in credit and real estate, and one of the larger players in infrastructure. But I wanna go back to that definition 'cause it's not. The story doesn't really end there. As I mentioned, secondaries is, is a solution for the constraints in the market. So what about the inverse to that constraint I talked about a minute ago? An LP that needs to get out of a fund before the end of that 10-year period. The inverse of that is LPs and GPs who wanna hold assets longer than that 10-year fund life would afford. There's nothing natural, inevitable, about a 7-year, 8-year hold period. The finance guys do not come from on high and say that you can't get more juice out of an asset after you've held it for 7 years. It just doesn't work that way. The mere existence of a big sponsor-to-sponsor market tells you a lot of these assets have additional upside beyond the 10-year fund life. So the second solution, the second challenge for secondaries to solve, was allowing GPs and LPs to hold their best assets, the ones they wanna hold longer than the 10-year fund life would afford. That solution was the GP-led deal, unlike LP deals. This market is nowhere close to being mature. You'll know it's mature when LPs can hold core holdings in private markets, just like they have their core holding, core holdings in public markets. You might hold your Amazons, your Apples for 20 years. Eventually, LPs will be able to do that in private markets, and no one will tell you they can do that today. It's sporadic. These opportunities come every once and again, but that market's nowhere close to mature. So I think this GP-led opportunity is probably in the second or third inning with a lot of runway left. You're seeing that growth already. If you look at the last 3 years, GP-led opportunity has grown more than 2 times compared to the prior 3 years. And again, to Michelle's point, this is a market we have a big competitive advantage in, given the breadth and the scale of our platform and the perspective we have on these private companies, given the direct lending platform. Now, in a way, I'm still only scratching the surface. There are a lot of other constraints in private equity. Think about risk clustering. You ever noticed that most private equity funds have the same return target profile, 20% and 2? There are a lot of investors who want to reduce that risk. That's where pref comes into play in context of secondaries. You take that raw material that's in private markets, you take risk out of it, and you lower the beta. So when you think about the different ways it's gonna grow, more assets in private markets, maturation of some of the newer asset classes, the growth in GP-leds, and then what I'd call innovations, that we don't even know what they're gonna be yet, where secondaries are solving problems for investors. We think there's a path to exponential growth in the overall secondary market. And again, our goal at Ares is to make sure we're positioned for the areas that are gonna have that highest growth as we build what we believe to be the secondary firm of the future. So with that, I'm gonna hand it over to my colleague, Nate Walton. He'll talk a bit more about what we're doing. Thanks, Eddie. As Eddie mentioned, we're always looking for where the secondary markets are growing or trying to match our product offerings to that growth. So three years ago, when we bought Landmark, they had three core businesses in private equity secondaries, real estate secondaries, and infrastructure secondaries. All solid businesses that will continue to grow at what we believe to be above average market rates. We also looked at where could we expand our product offerings and our asset classes. In the last three years, we've launched three new vehicles. Two of those are in the private equity segment, which I'll talk about here shortly, and one is in the emerging asset class of credit secondaries, which my partner, David Schwartz, will talk about here shortly. You have the core businesses, and you have the expanding new offerings. So we'll, we'll do a little bit of a deep dive today on some of these new offerings. In private equity, as, as Eddie mentioned, this is what we would refer to as the most mature secondaries market. It's been around 30 years. In fact, Landmark is largely credited with being one of the first, so an innovator in that space. However, this market has continued to grow and evolve and solve solutions and presents new opportunities. One of the reasons we think this makes a lot of sense is for the wealth channel to get their exposure to private markets. So as Raj was speaking earlier, he was talking about why private equity secondaries, over time, we believe, will be the preferred w-way for the wealth channel to access private equity. It makes intuitive sense. How many individual investors can have 10, 20, 30 GPs that they invest in? Many institutional investors struggle with that kind of deployment and that kind of monitoring. And so you can invest through a secondaries fund and get the vast majority of that exposure through one investment. And so we knew we, that secondaries would be the right asset class to get exposure to private equity, but what we have evolved and innovated on is really the way in which they can do that. And that comes with the launch of our Ares Private Markets Fund just over 2 years ago. As Raj mentioned, it's only just begun to scratch the surface to date. We recently went over $1 billion in AUM on this vehicle. The reason we think this vehicle makes so much sense is because it allows an individual investor to get fully invested on a monthly basis. You don't have to wait years to have your capital draw down. You don't have to manage capital calls. You simply can invest in this vehicle, and if you want liquidity at some point down the road, you can ask for liquidity. We think that is how the individual investor will ramp their exposure into private markets and private equity, in particular, over the coming years. We're, we're really excited about this Ares Private Markets Fund. We think it's got a lot of momentum in front of it. On our, on our more traditional secondaries offerings, we recently launched a new product around Ares Global Structured Solutions, and, and that's a term you may not have heard before in secondaries, but I think it shows the innovation of the asset class. What does that mean? It means that you have thousands of general partners in the world who have billions of dollars of assets on their balance sheet, largely in the form of GP commitments, and you have thousands of limited partners in the world who have billions of dollars of LP commitments. So you have all of these assets that are out there, and historically, your two choices are to hold your asset or to sell your asset. Well, there's a third option, which is to raise capital against your assets, and that's what structured solutions effectively do. We provide capital, either liquidity or growth capital, to both GPs and LPs, and in exchange, we get a preferred rate of return. Sounds a lot like what we do in a lot of our credit parts of our business, that predictable rate of return. Providing capital against existing assets is a secondary skill set that we have. We've been a market leader in this space in our own private equity business over the last 10 years. We've done $6 billion of these transactions. It's represented over 30% of our last few secondary funds, and because the market opportunity continues to grow, recently reaching somewhere in the $8 billion-$10 billion range, we decided to have a separate, dedicated pool of capital just to go after this opportunity. It currently represents about 10% of the secondary market today, and we think over the next five years, that market share will grow. So we're excited about the innovations, even in a market like private equity secondaries, which has been around for 30 years. And so with that, I'm gonna turn it over to a newer asset class and let Dave talk about credit secondaries. Great. Thanks, Nate, and good morning, everyone. Credit secondaries is, as Nate mentioned, is our newest vertical within our broader secondaries franchise. And we're extraordinarily excited with the opportunity to leverage our 30-year history in secondaries and our 20-plus year history in direct lending. Our enthusiasm and conviction about the opportunity is predicated upon the observation that you now have the key ingredient for any secondaries market to emerge, and that's namely a large and vibrant primary market. You certainly have that today with a $1.7 trillion private credit asset class, which is expected to continue to grow to $2.8 trillion by 2028. Obviously, a meaningful amount of AUM in this asset class, but more relevant for credit secondaries, are the sheer number of investors that have approached this market. For us, what that means in credit secondaries is that represents prospective sellers. Now, most of these investors in private credit are gonna be fundamentally content with the performance of their manager, particularly if they invest with Ares in direct lending. But a portion of them will be required to divest of their fund stakes, largely due to the same reasons they sell private equity, real estate, and infra, including the need for liquidity, first and foremost, a desire for portfolio rebalancing, as well as a new CIO and changes in their investment mandate. The good news for those sellers is you now have a credible buyer universe to absorb the supply that's now come to market. You have folks with the appropriate cost of capital, the right amount of capital, and at least in the case of Ares, real domain expertise. So you've now seen the credit secondaries market, which was largely anecdotal for the last couple of years, $1 billion-$2 billion max, has quickly grown to $20 billion of annual volume being brought to market, with all expectations that this market will continue to follow the primary market and grow to approximately $50 billion here in relatively short order. That gets us extraordinarily excited here at Ares about that opportunity. As Jarrod mentioned earlier, we are meaningfully investing behind this opportunity, and since launching the business a year ago, believe we've already established a leading market position. As you can see in here, that investment that we've made shows up. We believe we've already put together the industry's largest team, focused on this burgeoning growth opportunity of 12 people. Importantly, credentialed backgrounds of both lifelong secondaries practitioners, as well as folks who spent their entire careers in Ares in direct lending. So we have a real appreciation for who we're investing in, but also what's in their underlying portfolios. Our team has already activated our multi-channel sourcing networks, and we have seen over $26 billion of opportunities in credit secondaries to date over the last year. And importantly, we believe we've already put together meaningfully differentiated and scaled capital to this market to the tune of $2 billion, and we're happy to announce a recent close of $1 billion for our dedicated credit secondaries vehicle. We're extraordinarily excited about the burgeoning growth opportunity in credit secondaries and the market position we've established today. Wrapping it up for our secondaries panel, as you heard from Michelle, we are extraordinarily pleased with the business we have built here at Ares in secondaries. We believe we are scaled and market-leading businesses across private equity, real estate, infra, and now credit, with over $25 billion of AUM. As you heard from Eddie, there are meaningful tailwinds supporting our secondaries platform, including continued growth in all of our primary markets, as well as increased need for liquidity by private markets investors. And as you heard from Nate and me, we continue to innovate and develop new products for our investor base to meet market demand as well across our fastest-growing segments that include structured solutions, real estate, infrastructure, and now credit secondaries. So with that, we're now going to turn it over to our good friend, Matt Cwiertnia, to cover private equity. Thank you. Great. Thanks, Dave. My name is Matt Cwiertnia. Speaking of anniversaries earlier, it's coming up on my twentieth anniversary here at Ares. At Ares today, I think you've heard in lots and lots of different ways, there is a tremendous number of opportunities for growth and growth throughout North America, Europe, and Asia. Private equity is no different. So what I thought I'd do today for just a few minutes is speak to you about how we're going to generate that growth, how we think about generating the growth, and one of the most important things, in our opinion, to generate that growth, which is performance and differentiated performance, or as we like to say, performance. AUM growth will follow great performance. So for us, in North America, the primary strategy that we operate in is our corporate opportunities strategy. We manage about $21 billion worldwide. We have invested about $24 billion in that strategy since inception in about 85 portfolio companies. For us, there are really three key focus areas that we have and we think differentiate our private equity business against other private equity businesses, and certainly other private equity businesses of large public alternative asset managers. Those would be middle-market focus. So you've heard that probably throughout this whole presentation, is our presence in the middle market, and that presence in the middle market throughout asset classes, really starting in direct lending, but going through all asset classes, benefits our private equity business. In addition, when we invested that $24 billion, most of those dollars have been in the middle market, and our pattern recognition, our expertise, our experience, our resources, are very tailored for the middle market. Second, Mike talked about it at the beginning. A differentiated origination platform is what we think we've built here at Ares. In private equity, we try to take advantage of that differentiated origination. All of those numbers that Mitch and others spoke about in terms of the volume and deal flow that we get as a firm, and many times then, that advantages us and, and benefits us in our private equity business. The second part of differentiated sourcing is we're very proactive about what we are chasing and why. We only focus on four core industries: healthcare, services, industrials, and consumer, and we're very proactive in those industries to find the companies that we want to partner with and that want to partner with us. Finally, the last part is something that we've been doing for over 20 years in this corporate opportunity strategies. We think we have been becoming and being great business builders. In today's market, where I think alpha generation is paramount to deliver that excess return, to deliver attractive returns to investors, for us, the core skill set that a great private equity firm needs to have is to be a great business builder, and I'll talk about that just a little bit. Double-clicking, this size and scale of Ares, we believe, is a huge differentiator and competitive advantage for our private equity business. When we have talked in a number of different speakers and panels of the number of relationships, over 1,000 globally, of financial sponsors, when our private equity business walks into a sponsor to buy one of their companies, to make an investment, we are walking in typically with the long-term relationship of the Ares brand, and the Ares people, and the Ares culture that you've heard about today, and the collaboration that we work with, that typically provides us, in private equity, some form of an advantage. So as we then mine the middle market with all of our experience to find those inefficiencies, those companies we think we can grow at very attractive rates, you can see this chart on the right-hand side, 100% of our deal flow had that sourcing or process angle. A lot of our deals end with us being in that exclusive position, negotiating with someone who wants to partner with us, certainly as a private equity business, but also they want to partner with Ares and the global brand, and I think even the public stock and the currency, et cetera. People know who Ares is, and they want to partner with a global firm to help get them to the next level. When we talk about being a strategic business builder, we talk a lot and we focus a lot on the value add that we add to companies. So we have our own value creation system. We focus on driving top-line growth, and at the end of the day, something we're very, very proud of, a full 82% of our value creation has come from EBITDA growth. For those who follow the private equity industry closely, you will know that we went through a period of time here where it was more of a levered beta market, as we say. It was more about stock picking; it was more about multiple expansion in the private equity business. For us, we've always been about building businesses and driving attractive returns to our investors through EBITDA growth. So finally, when we talk about then being involved in these middle-market companies and doing a lot, and here are some stats on the top half of the page about how many talent placements we've made, how many people we've added to our businesses, M&A that we've done, tech enablement that we've done, multi-unit expansion, just lots of KPIs that says we do a lot with our companies, and we think that is a differentiator. But I'll go back to something Mike said at the very beginning, which is, "This is simple, but not easy," and simple but not easy is here on the bottom. If we need to generate performance to drive AUM, then for me, these numbers are what I focus on at the end of the day, and what the team focuses on. We are generating revenue and EBITDA growth in the portfolio in the mid-20s. That's a healthy growth rate. It is simple to understand, but not easy to do. And if we do that, that we take middle-market companies, and we grow them generally at north of 20% rates of return, and we get the law of compounding to work for us, then we're going to generate attractive rates of return for our investors, today, sitting at about a 24 gross and a 17 net. So in APAC, Edwin was in earlier talking about APAC from a credit perspective. In APAC, we made an acquisition last year of Crescent Point, and we're thrilled to have them as part of the platform. So today, managing just about $3 billion overall. We are excited to continue to scale that business as that market in private equity continues to mature, probably along a similar line and growth trajectory as what Edwin talked about on the credit side. So as I think about where Ares Private Equity is headed, you heard me talk a lot today about performance, and that's what we focus on day in, day out. Generating performance will generate attractive returns for our investors. That will generate AUM growth, especially here in North America. We think we are very differentiated in this middle market. The firm is differentiated, and as the firm continues to grow, more and more benefit to our private equity business. We have resources, we have experience, we have expertise and pattern recognition in that middle market. We think we are differentiated, and as you think about large public asset managers, alternative asset managers, we're really one of the only ones, if not the only one, whose private equity business has stayed true to the middle market. It's a huge advantage for us when we walk in the door. And finally, I think as in other asset classes you've heard today, we have plenty of opportunity to grow in North America. We have plenty of opportunity to grow and scale in Europe, and we will continue to scale the recent acquisition that we've done in Crescent Point in Asia. So I think we have the opportunity to grow, both organically and inorganically, and contribute to the 2028 targets that we've set out today for you. So with that, I will turn over to our last segment before we get to Q&A for David Reilly to talk insurance. Good afternoon. I'm David Reilly. I'm Co-head of Ares Insurance Solutions, and I'm joined today with Lou Hensley, CEO and President of Aspida, Ares' indirect insurance subsidiary. Ares has had a long, fantastic history working with insurance companies. Today, over 250 insurers are partnering across our platform, investing circa $60 billion of assets across all of our strategies. We set out a number of years ago to look for strategic opportunities in the insurance space for Ares. We entered into a number of joint ventures, strategic partnerships, even made minority investments. All that culminated circa four years ago with our sponsorship and launch of Aspida. We've also invested significantly in people, technology and infrastructure at Ares for the success of Aspida, but also for our other insurance clients. We've assembled a phenomenal team from the insurance world, asset management, investment banking, and we're providing significant strategic services for Aspida, including asset optimization, risk and capital optimization, as well as corporate development. This has really been guided by putting key guiding principles together for the success of building a truly world-class insurance platform. From the Ares perspective, it's really centered upon providing a material, significant investment in Aspida, and our minority investment is providing tremendous alignment with the growing and large number of co-investors being attracted to the platform. You've heard a lot about power of the platform at Ares, and that is truly on exhibit with the build-out of Aspida. We're leveraging all the resources of the firm for the full success and intention of building a truly world-class insurance platform. From the Aspida perspective, it's really focused on providing simple, spread-based products sold through multiple distribution channels and really leveraging off of a truly game-changing technological advantage. All of these principles are in action today and giving Aspida incredibly strong operational momentum. You've heard a lot about the retirement market today. Well, Aspida is leveraging into many of the same topics that Raj and others had hit on earlier. And that's really those secular tailwinds of increased life expectancy, rising healthcare costs, and increasing expenses. And Mom and Dad America are really being forced to save for themselves to provide for income later in life, no longer able to rely on defined benefit plans. And that's where annuities have come in and have really been able to offer an incredibly enhanced return on an after-tax basis relative to traditional investments Mom and Dad America are being offered. And that's propelled this market to grow exponentially over the years. Last year, over $385 billion of annuities were sold. And interestingly, it's a really fractured market. 35 insurers last year sold over $1 billion of annuities. This market is ripe for change, for innovation, and Ares and Aspida are incredibly well-positioned to take advantage of that. With that, passing on to Lou in Aspida. Thanks, Dave. Great job. Good morning, everyone. As Dave mentioned, I'm the CEO of Aspida, and I gotta say, I have probably the best job in the world. And you'd say, "Well, why is that?" We got to build an insurance business from scratch. We've got to leverage all the capabilities, as Dave mentioned, of Ares to build out our insurance business. We got to implement best practices day one across the entire insurance enterprise when we launched Aspida. It's been fabulous, and we've made the most of it. And you can tell by some of the numbers here, the success that we've had in building the platform. So we launched Aspida three and a half years ago. Today, our balance sheet is $14 billion in invested assets, all from organic growth. In 2023, last year, we wrote $6 billion in new premium. T hrough our retail and reinsurance businesses, surpassing our goal of $4.25 billion-$6 billion. So it's been a successful, very successful launch. Other parties that have got into this space have traditionally bought existing platforms, and there's some, definitely some pros to doing that, and some cons. Advantage of buying an existing platform, you can get to market quicker. However, the disadvantage, in my mind, is you can get saddled with a lot of legacy liabilities. You know, insurance products that have been put on the books over decades, in some cases, even maybe a century. And then you combine that with the technology debt that comes associated with putting all those policies and administering those policies on the books. At Aspida, we don't have anything, anything like that. We're 100% focused on the go-forward business model. Which kind of transitions into our key differentiations. David hit on some of these items. I'm really just gonna focus on the third row here on technology. At Aspida, we really do have a differentiation on the technology side from a speed, service, and scalability standpoint. And to put the speed and service aspect in perspective, you have to understand our industry. Most annuity writers in the U.S., when they think of issuing business, they think of issuing business in days, weeks, if not months. In the case of Aspida, we're really focused more on seconds, minutes, and hours. And how have we been able to do that? Well, once again, we didn't have any legacy platforms, and so we started with a clean piece of paper. We took a contemporary look at the market and said, "We want to build something that's digital." Since we've launched, we haven't taken one paper application. Everything we have done has been in a digital format. Also, you can see the stat up there of 91%. That's the percentage of policies that we've been able to issue with new money in less than 24 hours. In addition to that, we're able to pay our distribution partners also within that 24-hour mark. It's created a tremendous amount of buzz in the industry and has been part of our success and growth. The other thing I mentioned on technology, scalability. Today, we have 150 employees at Aspida. We do everything in-house, with the exception of investment management, which we outsource to Ares. But with that said, because of the technology platform we built, it's highly scalable. We have a lot of capacity with the 150 people we have to continue to grow the platform. Team slide, I obviously don't have a lot of time to talk about this. I just want to give you one takeaway on the team. We obviously have a fabulous team to be able to accomplish what we accomplished. But at the end of the day, everyone on this page has relocated their families either to North Carolina or Bermuda to be part of this journey. Everyone's all in. The investment page, you can see we have a very high-quality investment portfolio. Obviously, this is all driven by Ares, and this is one of our key advantages in the marketplace. We're able to source very high-quality investments that match our liabilities very well and allow us to generate excess returns, which is, you know, helps us, our products, be more competitive and create better returns for Aspida. Last slide, growth. So again, today, we're at $14 billion of AUM. Our goal is to get to $50 billion by 2028. And how are we gonna accomplish that? We're already on that path. We've built the platform. We're witnessing tremendous growth, even beyond 2023's growth of $6 billion. And really, it's about just expanding our reach in the retail segments, adding additional reinsurance clients in the US and abroad, and continue to build out our product portfolio. Today, Aspida has roughly $1.3 billion of capital that's been infused into the company to support its current growth. And then when we complete our fundraise, we feel that we'll have sufficient capital to support the growth to $50 billion through organic sales. And then, in summary, just closing this out, you know, the platform's built. We're executing. We've been exceeding all our previous plans and targets. The market demand for the products we offer, both in the retail and the reinsurance side, are in high demand at this point, as Dave pointed out. We have a true technology edge that is able to scale our platform and has made a differentiation in our cost basis. And the last, and of course, not least, is the Ares edge and Ares' ability to generate high-quality investments that support our liabilities, that generate excess returns, which help make our products more competitive and also benefit Aspida. With that said, thank you very much for your time, and I think we have up next Mike, Jarrod, and Greg for closing remarks and Q&A. Thank you, guys, and thank you for sticking it out with us. I'm gonna say, Lou, I think I actually have the best job. No offense, because yours is pretty good, too. But I get to do what I love with people I love, and I've been doing it for a really long time. And you sit through a day like we just went through, and hopefully, you just get a, you know, a sense for the competitive advantages that we've built, starting with the special culture and the relationships that we have. Obviously, we have been growing at a very significant pace for a very long time. Tony said in his opening remarks that the next 10 years should be easier than the last 10 years, and I would agree. We have more scale, we have more capability, we have more capital, we have more people, we have more competitive advantage than we've ever had, and the growth in our markets is accelerating as well. So I think if we just keep following the playbook that we've laid out, that has served us well over the last 30 years, if we keep being guided by our core principles and values, I think the future will be bright, and hopefully, we'll continue to enjoy all of the same success in the future that we've had in the past. So we look forward to sharing that journey with all of you as well. And with that, I'm gonna invite Jarrod and Greg up, and we have some time for some Q&A if folks, folks are interested. Thanks again for joining us today, and we'll open it up to questions. Thanks. Good morning, everybody, Alex Goldman Sachs. Thanks—thanks for putting a great day together. It's great, great insight. So I wanted to start with a question on investments. You guys have a history of making substantial investment in the business that drove, obviously, the growth that you outlined on the slides today. As you look forward to sort of achieve the growth you've talked about, what are the key areas where you expect to incrementally spend more? Clearly, you have ability to expand margins faster, but as we talked about before, you, you're sort of choosing to reinvest that. Without going business line by business line, I would think that we're gonna over-index to investments on the investment side of the house. The combination of continuing to outsource, upgrade, and centralize our non-investment functions in places like Mumbai, I think give us an opportunity to scale without adding significant cost. Some of my commentary earlier around technology, innovation, AI, and the efficiencies we'll get there, too, I think will help reduce spend on the non-investment side. If you remind yourself of my earlier comment, the binding constraint to growth and winning in these markets is going to be origination, investment, and portfolio management at the end of the day, and that's not to disparage all of the other, you know, critically important functions to get that flywheel moving. But I think where you'll be seeing a disproportionate amount of investment is on the investment side of the house. Mike? Hi, Mike Cyprys, Morgan Stanley. Again, thanks so much for the time and insights today. Just... I was hoping you could elaborate on your comments on AI. Just maybe to talk a little bit about how you're experimenting with that. How many use cases have you identified? How many do you have in production? How many do you think you'll have in production a year from now? How meaningful could that be for the margin, for the overall company, and how do you think about that at the portfolio company level as well? Thank you. Sure. So for those of you who have known us a long time, we are not prone to hyperbole, and I think we have to be careful that with regard to AI, the same as with everything else, you have to have a measured view about what the opportunity and what the risk, the technology imposes on us. The acquisition of Bootstrap, the aggregation of that capability and the movement of that capability into our strategy group is an important first step. Because what it does is it elevates that capability to a place in the organization where we can deploy it across everything that we do. And I think others, and we've learned this with things like ESG as well, when you bury those deep into the organization and it's too distributed, you can't actually drive the type of change that you need to. The first thing that we did, which I think is key to good implementation, is you have to set up the right governance framework around use cases, prioritization of use cases, data governance, governance around use of confidential information. So we spent the first, you know, number of months on this journey, even before the acquisition of the capability, getting our governance structure right. And again, that sounds so simple, but ultimately, in order to get good outcomes, you need to have good inputs and a good structure. So we formed an AI steering committee that has representation from investment, non-investment functions, technology, and the C-suite, and we set out to codify what risks we were willing to take and how we saw the opportunity set. As I mentioned in the presentation, the three places for the innovation to play is within the investment portfolio, where I actually think is where we will see the biggest bang for the buck. And again, as exciting as the technology is, we view it as a supplementation of more traditional businesses. So if we can bring good structured technology solutions to our portfolio, improve margins and profitability, that obviously shows up in performance, with which then, is a benefit to us. So investment portfolio is one. Two is within the existing business, there's a huge opportunity, as I mentioned, to leverage technology, in Jarrod's world, on some pretty basic, investment operations functions that have been largely manual intensive over the, you know, the decades that this business has been in place. To name one, for example, KYC and subscription documentation. That's a highly manual process that with very little technology investment, could, you know, reap great benefit. And then the third is in the investor experience. And that's how do we mine data, better risk analytics, better portfolio construction, et cetera, to help serve our LPs better. The holy grail of all of this for us will be to then unleash the technology on the underwriting of new investments, right? So when we take all of the private data that we have. How can we apply this technology to actually inform the decisions that we're making? And I say holy grail, because back to governance, that is not an easy thing to do, given the current regulatory guidance that exists around the application of the technology. So we are building the infrastructure to do it, but I think we're still a ways away from, you know, putting the technology into effect. We are currently using the available tools that are coming through places like Microsoft, for example, within their suite of products. We're already beginning to see that that can generate significant efficiency. But at the end of the day, the goal is to have our own models that we can apply to our own business that would get us the results that we want. Craig? Craig Siegenthaler, Bank of America. Guys, thanks for hosting a great event here. If you look at the liquid fixed income markets, you had this oligopoly form, like, 20 years ago, BlackRock, PIMCO. You're seeing the same thing form in the private credit markets, with the leaders having depth, breadth, infrastructure, credit, ABF. Do you think the gap widens between the top three or four and kind of five to 10 over the next 10 years? I do. I don't know if, if I would use the term oligopoly, but as I showed earlier, the markets are clearly consolidating, and you can see that, to remind people, on the fundraising side. So if you look at the published fundraising data, the last five years, the top 25 managers took 56% of the capital. The five years prior, it was, you know, 32%, something like that. So you're already seeing that consolidation. When you see the deployment come through, to Mitch's slide earlier, just showing the deployment, both in terms of the scale and consistency, we're taking share in that consolidating market, but we're doing it with a set of competitive advantages that are very unique. So I think other people are moving to scale, but they're doing it in a single segment of the market and a single geography. I don't see any one of our competitors that has accumulated scale, capability, and the ability to play in each of those segments for the market around the globe. This is why I think you're hearing such conviction that our leadership position, even in a world where people are perceiving more capital coming into the market, you know, that we're not actually experienced that, you know, as compromising our opportunity set. How many players ultimately, you know, exist at the end of the day? Time will tell, but I do think the big will get bigger. Let's go with Bill. Thank you very much. Bill Katz, TD Cowen. Terrific presentation. Thank you. Maybe a two-part question, somewhat disparate in scope. You spent a lot of time talking about your success in terms of acquisitions, Black Creek and Landmark. It seems like that's moving up the pecking order a little bit from today's presentation. I was wondering if you could talk a little bit about product gaps, where you might see the opportunity set and the economics associated with that. Full stop. Second question: If everything's getting easier for the next 10 years, and you did a 30-some odd% FRE CAGR in the last 5 years, why only 15%-20%, given so much margin improvement as well? Thank you. Sure. I'll answer the first one, then you can answer the second one, 'cause I'd probably answer it in a snarky way, which you won't. So, we only talked about two examples 'cause they were recent, but obviously, we have been acquisitive. And if you were to go back in the history of the acquisitions, you would see a very similar synopsis, that we were focused on good culture, we were focused on large, transformational, market dynamics, we were focused on financial accretion and the opportunity to take good businesses and make them great. And so you would see similar types of numbers if we talked about infrastructure debt or Asia credit or even going back to the acquisition of AREA Property Partners, you know, over a decade ago. And what you'll see is that because of the value that we bring, we're able to buy these companies you saw at 5-10x EBITDA in a market that is trading at a premium to that, and with a currency that obviously trades significantly in excess of that. So we will continue to lean on that experience and that playbook. As I highlighted, the places where we perceive gaps, they're fewer and far between at this point, just because we've also demonstrated that we're getting better at building businesses. And so a lot of times, we're gonna be attacking these product gaps with an organic build. But places where we see transformational change happening and a desire to get scale quickly, right? So if you think about Landmark, transformational changes the team described in secondaries, we needed to get big quicker than we could have otherwise done if we did it organically. So the two places I mentioned in our prepared remarks were infrastructure, generally speaking, with an emphasis globally on digital infra, and then continued expansion in Asia. Because, again, when you go back and hear what Edwin talked about, that's where the growth is. So I don't wanna oversimplify a complex, you know, thought process, but if 60% of the global growth is gonna be there, and you understand how these markets mature and evolve, we need to be there, too, with a much broader set of capabilities over time. Thanks. Yeah. Mike had it in his slides, and, and then it was the first slide for me, that we shared with you where we have been the last five years, and it was that 35% growth. When we talked about our five-year plan, we had laid out a, a 20% CAGR. You saw that, that we grew greater than what we thought, and that's certainly in the realm of possibility. But Mike, you also heard him say that we're not prone to hyperbole. So we wanna put out guidance that we believe is right in line with... We will meet that guidance, and we always have the chance to exceed that guidance. We're gonna continue to grow, and I do hope it gets easier over the next 10 years, but we'll, you know, look in and certainly always beat that. And, and essentially, looking at RI and the strength of RI and the conviction around RI, I don't think that there's many other people who can look at their performance fees and say, with conviction, "These are the performance fees that, that we're targeting over this period." We think that that is a meaningful growth driver of the business as well. Yeah, it's an interesting thing. I don't know many industries, A, that are growing at 20%+ per year with a, you know, 3%+, you know, contractual payout, and have been doing it for 25 years. I also don't know many industries with all of the variability in global markets, that have the confidence to put out five-year guidance to begin with, let alone, you know, five-year guidance at this magnitude. So for all of the excitement and enthusiasm, I also want to just take a step back, because we're professional investors as well. You know, find me an industry that could give you that kind of guidance with that, you know, level of tolerance, and there's just not that many places where you can see it. Obviously, when you're going five years out, there's a lot of optionality up and down, and you got to put something out that, you know, that's appropriate. Let's go to Brennan. Thanks. Brennan Hawken, UBS. DPI was referenced a few times today, and it certainly is important to feed the flywheel that you spoke to, Michael. So can you speak to what you're doing or what you can do in order to maximize DPI within your own business in the current environment? And also, what trends you're seeing in the industry that could maybe inform how that's progressing, because we know how much LPs are looking for it. Sure. So DPI is critically important. I think folks should appreciate it's more important on the private equity side of the house and the business than it is on the credit side, because when you're delivering 10%-12% current yield, that is DPI. So to Jarrod's context around European waterfall, one of the reasons people are attracted to private credit increasingly is just the value of that current distribution, both as a risk mitigant, but also as a provider of liquidity. So when you look at our fundraising success on the private credit side, it would tell you that if there is a DPI issue, we're not feeling it. Obviously, on the private equity side of the house, we have to be mindful of that. As Matt mentioned, we are very focused on delivering performance first, because that's ultimately what brings the capital back into the house. And not surprisingly, like all other private equity, private equity managers on the planet, we're gonna look at tools available to us, sales of companies, minority sales, secondaries, continuation funds, et cetera. I would say we are a net beneficiary of the lack of DPI right now. So when you think about opportunistic credit, structured solutions, direct lending, all of these capital pools, alternative credit, are going in to solve for that equity gap, because you have owners of assets and companies that don't want to return capital in this valuation environment. That said, I think given the economic backdrop and the stabilization in rates, you heard it from Julie, you heard it from the direct lending folks, the pipelines are picking up, and we talked about this on the earnings call as well. You're beginning to see buyers and sellers come together. In real estate, we're, you know, seeing an unfreezing of transaction volumes, and I'd say on the private equity side of the house, we're seeing a pretty significant acceleration in flow right now. Let's go with Steven. I did want to ask a question on the wealth channel. I know you guys are seeing really strong momentum there. Given some of the targets that Raj had outlined, it does suggest a meaningful uptick in fundraising. Historically, you guys have maintained a really good discipline around fundraising in relation to the deployment opportunity. That gets a little bit tougher to manage within the retail channel. We're hoping to get some perspective on how you ensure that you're going to maintain that discipline. Yeah, it's -- there's a tension that you need to create, obviously, between capital and deployment. It's -- we've talked about that a lot. I would point out in Raj's projections, he was taking us from 6 installed products on the platform today to 8 to 10, right? So some of that growth is gonna come from broadening out of the product set, and then it will come from further penetration. The easiest way to control is just the pace with which you bring on new distribution partners, right? So that is our controllable lever. So we're clearly growing and diversifying those relationships, but we control the pace of when we want to put them on the platform and start the sales cycle. That doesn't give you perfect, you know, month-to-month control, but it gives you the ability, at least from a forward, you know, forecasting perspective, to look at, you know, what the capacity in those channels are and how we want to pace ourselves. Yeah, you know, listening to your Investor Day, as well as those of your peers, you can't be struck by the growth in size, scale, and complexity of what you have built here and what it's likely to be in another 5 or 10 years. I'm just kind of thinking, what are the guiding principles, and how do you have to think about building a risk and control infrastructure? How do you manage conflicts of interest? You know, as the companies like yourself touch different parts of the capital structure of, you know, all kinds of different firms, you know, how do you manage potential conflicts of interest? You know, same as going into retail and, you know, where you're able to earn performance fees on marks as opposed to, you know, the old way of realization. How do you manage the risk structure in all that? Sure. I'd say one of the first things that we do is we look to avoid putting ourselves in a position where we would have some of those conflicts. I mentioned it during my balance sheet light portion of my presentation. I'd say that we also, we don't lend to our private equity portfolio, so we don't lend to ourselves. We're not essentially ever a self-dealer, putting ourselves into that position. We spend a lot of our money on our compliance, on our legal, on our finance and accounting, working with our internal people and our external advisors to make sure that we're aware of situations where that could occur and how we would address it. It's certainly one of the things, frankly, that I believe gives us an advantage a lot of times, because it's expensive to put those things in place. It's expensive to put those controls in place. If you don't have scale, it's a lot harder to do that. But it's also part of the culture in that people know that they need to share data in a certain manner. They know when it goes to a certain part of the portfolio, that they're also incentivized to make sure it's successful there. So it's not about building little fiefdoms across the organization, where they're competing for an asset or a return, but we're really incentivized to work together and to collaborate such that we can avoid conflicts like that, that could ultimately erode your culture and erode the trust from your investors. Yeah, put it in perspective, I mean, we're, we're a $45 billion market cap company that have been doing this for 30 years, so you should assume that we actually understand how to manage enterprise risk. Otherwise, people wouldn't give us their capital to manage because everybody who invests $1 with us, whether you're a pension fund or one of the wealth platforms, is doing extensive operational due diligence with a focus on enterprise risk framework. So we could spend hours talking about it, but, I think that's kind of table stakes, is you have to be great at that. If you look at our 3,000 employees, maybe to give you another lens, half of them are non-investment people, right? So we have 1,500 people at this company that are not investing, just to give you a sense for the scale of all of the support functions, including legal, compliance, and ERM. Mike? Mike Brown, Wells Fargo Securities. Focusing on the alt credit side of the business, so some of your peers have gone down the path to owning origination platforms. As a balance sheet light player, that's not your strategy, but maybe you can expand on some of the advantages that you've seen to your approach. And as you think about perhaps expanding with the insurance clientele, is that ever a strategy that would need to change or shift, or is it, you know, truly sticking to the balance sheet light model? Sure. So I'm gonna give you our answer, and this is not meant to disparage anybody else's approach, because there are lots of different ways to bake a cake. We believe in the balance sheet light model. We think it gives us more flexibility to navigate cycles. We think, to Jarrod's point, it delivers a higher ROE more predictably to our investors. Number three, we think it does not compete with other participants in the market, like our third-party insurance clients. And given the breadth of our product, you've heard me say this before, if someone wants to invest in Ares investment product, they have 25 ways to do it now in the liquid, illiquid, and institutional market. So we believe that as an asset manager, our responsibility is to deliver the market asset management profitability, not investment exposure. We do investment exposure in other parts of the business, so that's true across the board, not just in our insurance business. Number two, I think that insurance comes with a different regulatory framework, a different style of investing, and a generally different approach to how you think about growing those businesses. And historically, insurance companies have traded at book value. I think if you look at what we're doing in Aspida, we can do better than that through the use of technology, better investing outcomes, et cetera. But we know, and all of you in this room who cover financial markets, there's been a constraint on value in certain segments of the balance sheet, equity markets, banks and insurance companies, in my opinion, for a reason. So we don't want to inherit that complexity and that constraint. I would also argue, when you look at the body of work in financials for the last 30 years, other things that have traded at book value are origination platforms within specialty finance. And you could go across 30 years of public equity market performance, and you will see that, you know, small specialty finance platforms trade at book value. And maybe in different rate environments, you'll see a general pop. So the way we've always thought about it is, if you're building a sustainable business, I would rather have those people in-house at book value than pay a premium for a platform that I think is worth book. So it's not that we don't invest in origination. If we see a market where we think we can create sustainable origination advantages, we build a team. So we've got teams in triple net, we've got teams in autos, and then we can go out into the market agnostic and transact with other finance company platforms that we don't own. So similar to the way we're thinking about balance sheet light, if I go out and I set up an equipment leasing platform as a captive, the other 99 equipment leasing platforms in the market are not gonna wanna transact with me. So it's just a different capital framework and a different view. From time to time, we will invest in origination platforms within fund families to drive a specific outcome into that fund. But again, when you go back to our core principles of origination, we wanna own it and control it, not through the equity, but through the culture and the people. You know, not to say that one is right or one is wrong, but that's just the way that we've thought about it. We have time for one last question. Anybody? All right. Well, thank you all for joining us today. Hopefully, it was a very informative day, and you got a lot out of the content, and I think that wraps up, our day today.