Home ListingJuly 13, 2015

Alts Giants Boast 50%+ of Global Industry AUM

Macquarie Group, Bridgewater Associates, and CBRE Global Investors topped Towers Watson's alternative manager ranking with $264 billion in cumulative assets.

Reported by Featured Author

The 100 largest alternative managers worldwide held $3.5 trillion in 2014, more than half of the $6.3 trillion total global alternative assets, according to a Towers Watson survey.

Leading real estate managers had the largest share—one-third of total assets amounting to more than $1 trillion—as investors have focused more on underlying return drivers, the firm explained.

Hedge funds and private equity followed suit, making up 23% and 22% of the top managers in 2014, respectively.

Illiquid credit saw the greatest uptick among the top managers last year, adding 28% in assets, according to the survey. In contrast, hedge funds and infrastructure funds grew just 9% and 8% each.

Real estate managers also held the largest portion (36%) of pension assets, Towers Watson found, far ahead of private equity at 15% and hedge funds at 12%.

The lag in interest for hedge funds and private equity could be due to their complexity, the report said, as well as some funds lacking the strong governance structure necessary to carry out these investments.

“There is also a growing trend of investors differentiating between alternatives and holding a more granular return-driver perspective when building the asset allocations instead of using the traditional asset class approach,” said Brad Morrow, Towers Watson’s head of investment manager research.

North America was the most popular destination for alternative investments, the survey found, with nearly 50% of capital invested in the region. However, Europe still dominated in assets invested in infrastructure and illiquid credit, the report said.

According to the research, Australia-based infrastructure manager Macquarie Group topped the overall manager ranking with more than $92 billion in assets.

Bridgewater Associates came in second, holding onto its crown as the largest hedge fund manager with almost $90 billion. Los Angeles-based CBRE Global Investors was the largest real estate manager and third on the overall ranking, managing $82 billion.

TPG Capital topped the private equity ranking—reporting $67 billion in assets—closely followed by the Carlyle Group with more than $64 billion.

Blackstone ranked number one for funds-of-hedge funds with $63 billion in investor capital.

Towers Watson Alts Managers Source: Towers Watson