The above graph shows the extent to which the focus of private debt funds are moving away from the acquisition of existing debt and towards the origination of debt. As banks – particularly in Europe – have taken a step away from corporate lending, private debt fund managers have filled the gap by allocating a growing amount of their committed capital to debt origination.
In 2011, capital raised for debt origination comprised 3.6 percent of the total amount raised for closed ended private debt funds. In 2013, it surged to 25.6 percent. In the first six months of the year, the portion rose to 30 percent.
The Hayfin Direct Lending Fund, the ICG Senior Debt Partners, and Rotschild Five Arrows Credit Solutions (FACS) fund, are some of the originating private debt vehicles that have held final closes this year.