Cliffwater caps private credit redemptions at 5% after 17% request in Q2

Blackstone's Private Credit Fund Joins Peers In Gating Investors After Surge In Redemptions The private credit gates are shutting all over again. After virtually every marquee private credit fund limited withdrawals after being flooded with redemptions requests in Q1, we are seeing more of the same as the second quarter rolls out. And two days after Cliffwater LLC capped redemptions at 5% after investors requested 17% to be returned, a jump from the 14.0% in Q1 (which was also gated at the 5%) limit, this morning Bloomberg reports that Blackstone has also limited redemptions from its flagship private credit fund for the first time after investors sought to pull 10% of the shares, the latest such fund to cap withdrawals amid a continued investor exodus. The $79 billion Blackstone Private Credit Fund told shareholders that it would return 5% of its shareholders’ money, according to a filing Thursday. During the previous quarter, the fund allowed investors to redeem a record 7.9% after tapping senior executives to help finance the withdrawals with hundreds of millions of their own cash. This time - realizing that the avalanche of redemptions requests will not ease for a long time - the company did not bother with coming up with a creative solution to avoid gating... and gated investors, joining all of its other peers in doing so.  Of course, Blackstone told shareholders that repurchases began to decelerate during the back end of its tender offer period, although as the chart below shows, we will have to wait until Q3 to see if that is true.  Across the $1.8 trillion private credit market, redemption requests are expected to increase this quarter as investors redouble efforts to claw back money after being restricted. What is concerning, is that despite the recent surge in software stocks - driven entirely by positioning and not fundamentals - private credit continues to feel the pain of investor revulsion to BDC's overreliance on sottware cash flows, suggesting that the recently meltup in software stocks is due to a major pullback as soon as the marketwide gamma squeeze fizzles.  Tyler Durden Thu, 06/04/2026 - 09:45

Shares of the biggest alternative asset managers tumbled Wednesday after Cliffwater LLC’s flagship private credit fund reported even larger redemption requests than in the first quarter, setting off a new wave of fears about the industry.

Cliffwater Private Credit Fund Gates Investors For Second Straight Quarter After Redemption Requests Soar To 17% The market may be in full-blown face-ripping bubble mode, and software stocks are now gripped in by a category 5 gamma squeeze hurricane, but not even that is helping the ongoing debacle that is private credit. The flagship private credit fund of Cliffwater, a fund which has was slammed by redemption requests in the past quarter as the private credit crisis came to a fore, has again gated investors by capping redemptions at 5% in the second quarter after investors looked to pull more than three times that amount, or 17% of shares, Bloomberg reported, in a sign of relentless pressure on the $1.8 trillion market. The $31 billion Cliffwater Corporate Lending Fund informed shareholders Tuesday that they’d get about one-third of their requested money back, according to a letter seen by Bloomberg. The prior quarter, investors got back around half of the roughly 14% they asked for, with the vehicle choosing to cap withdrawals at 7%. Shortly after Cliffwater’s decision in March, S&P Global Ratings lowered its outlook on the interval fund to negative from stable, warning that the 5% redemption threshold is “an important guardrail.” “Our repurchase program is intentionally designed to provide shareholders with periodic liquidity that aligns with the fund’s long-term investment strategy and its underlying assets,” Cliffwater CEI Stephen Nesbitt said in the letter to investors. And by periodic liquidity he meant far less liquidity than investors hoped to recovery.  The firm previously said that the fund, which has delivered a roughly 9.4% annualized net return since it was formed in 2019, has enough liquidity to meet 5% redemptions for more than a year without selling a position or an asset. After a second straight quarter of gating that may be tested very soon. Cliffwater has become something of an unlikely giant in the private credit market by raising money at a rapid clip and deploying it across both direct loans and funds that do such lending themselves. Other non-traded business development companies are set to report the results of their second-quarter tender offers in the coming weeks. In the previous period, some like Blackstone’s BCRED went to extraordinary lengths to let investors cash out (all for nothing as the looming redemption flood will overrun even the giant fund), while other funds at Apollo Global, BlackRock and Blue Owl enforced their 5% caps. Tyler Durden Tue, 06/02/2026 - 22:44

Fund with net assets of $31bn aimed at retail investors limits withdrawals in latest sign of exodus from sector

Cliffwater LLC’s flagship private credit fund capped redemptions at 5% in the second quarter after investors looked to pull about 17% of shares, in a sign of enduring pressure on the $1.8 trillion market.