Blue Owl Capital has recorded a steep slowdown in new subscriptions to its flagship retail-focused private credit vehicle, highlighting growing investor caution toward the direct lending market, according to a report by Reuters.
The reports a recent regulatory filing as showing that the firm’s Blue Owl Credit Income fund (OCIC) received just $26.4m in subscription payments on 1 May, marking a 95% decline from the roughly $480m reported during the same period a year earlier. The fund’s portfolio is currently valued at approximately $34bn.
The slowdown comes as private credit managers face heightened scrutiny over underwriting standards and portfolio exposure, particularly within the software sector. Investors have become increasingly cautious amid concerns that advances in artificial intelligence could disrupt parts of the technology industry that feature prominently in many direct lending portfolios.
In recent months, affluent investors have also sought to pull capital from certain private credit vehicles as concerns mount around credit quality and liquidity conditions in the broader market.
OCIC is structured as a business development company (BDC), a vehicle that combines investor equity with leverage to originate loans primarily to middle-market businesses.
