Alex Blostein: Good evening guys. Just maybe I’ll piggyback on Adam’s question around operating leverage. When it comes to the wealth channel, I believe there is a revenue share or kind of equity ownership share agreement within the channel. As you sort of build it out. Can you give us a sense at what level of assets or revenue base does it start to sort of break profitability and contribute more to the bottom line? Kind of, look on a net basis, sort of like net of minority interest and are we already there and kind of how do you expect that to scale and actually add to the kind of net of minority interest or non-controlling interest, FRE.
Johnny Randel: Yes, I’ll start and then others can add. The reality of it is kind of varies. I mean, I think we are getting there given the scale we’ve seen and the team we’ve got attached to it as Scott mentioned there is the investment process, which is a big part of what’s we think driving the success in terms of the returns that are being produced that’s helped driving the scale. And so when you kind of think about it from a consolidated business perspective, we haven’t given specific numbers, but we’re kind of in the range. And then from here, that’s when you start thinking about kind of that sharing, you mentioned. So the scale and, as Mike talked about doubling it in 10 months. And if that continues, then obviously we do think it can have an impact over time.
Alex Blostein: Got it. Okay. We can follow up, my other question or maybe should have been my first question. I wanted to talk a little bit about the secondaries business with you guys. And Scott, sounds like you’re seeing an increased opportunity for deployment there. You mentioned the urgency maybe on part of the sellers to come to market is great today than it’s been in the past, given that there’s not a lot of exits in the primary market. So help us maybe frame how much in dry powder you guys currently have across your secondaries business, perhaps even including the funds that are currently fundraising. How quickly do you expect to put that to work, given the opportunity set? And maybe just help us think about maybe the frequency at which you could start coming back to markets with subsequent vintages if the opportunities have to continue to improve.
Scott Hart: Yes, thanks, Alex. So, look, I don’t think we’ve put out there an exact number in terms of dry powder that we have across the secondaries business, but if I just kind of break it down and I’ll maybe stick with some of the commingled vehicles with some of the incremental closings on the private equity secondaries fund. That fund has now raised nearly $2.5 billion. It has started to invest, but still obviously much of that available in terms of dry powder and has some overage accounts that sit alongside of it. When you think about the venture business, we mentioned the first close at $1.25 billion, which will all be dry powder. But part of the reason we won’t activate that fund until next fiscal year As we mentioned, there is still some remaining dry powder in the $2.6 billion venture fund that we raise shortly after the green SPRING acquisition.
In real-estate, we’ve had closings on about $1 billion for the current fund and as we mentioned during the prepared remarks, the prior vehicle is now fully committed and so that kind of gives you a sense across some of our main dedicated commingled vehicles and obviously there’s separate account capital both within the private debt and infrastructure businesses that I hadn’t referenced as well as in private equity that as that dry powder number. And I think in terms of the pace of deployment, look one of the things, particularly in this type of market environment with some of the risks that exist that we continue to be very focused on is portfolio construction is one of the few things that is completely within our control and so we have taken approach of wanting to build diversified portfolios across a number of different metrics, including across vintage years.
And so I would generally expect that these funds are deployed over a roughly three year period in order to achieve that vintage year diversification. So I think that’s probably the right way to think about it, recognizing that certain separate accounts may have a shorter or a longer investment period. And maybe last point I would make given how much time we’ve talked about the private wealth business clearly some of what we’re doing in those vehicles is secondary focus as well which would further add to that dry powder number.
Alex Blostein: Okay, that’s great, thanks so much.
Operator: [Operator Instructions] Our next question comes from Michael Cyprys with Morgan Stanley. Your line is open.
Michael Cyprys: Good evening. Thanks for taking the question. I just want to ask about private credit. I was hoping you could talk about the opportunity set that you see in private credit today, particularly as banks are pulling back. Which of your strategies would you say are best positioned here and which strategies might be able to raise meaningful capital as you look out over the next 12 to 24 months in private credit and I think you have a retail vehicle launching in the credit space as well so maybe you can provide an update on that too? Thank you.
Scott Hart: Yes. So Mike, thanks for the question. I think in the private credit space, we continue to see and hear about quite a bit of interest amongst our existing and prospective clients even during the course of this year. I think the interest as our private debt team travels the world has continued to grow. We clearly view it as a very attractive risk reward when you can think about not only have base rates increased, but spreads have remained fairly consistent. And when you’re talking about 12% type gross asset yields investing at the highest part of the capital structure. And when you look at the performance in past downturns, it’s clearly a part of the business and a strategy that we think is quite attractive in today’s market.
The challenge has been, one like I’ve talked about across the business of deployment with M&A activity down, quite meaningfully, deployment has been slower than we otherwise would have liked, which has meant that we’ve had to continue to look for alternative deployment methods, that has in some cases meant looking beyond corporate direct lending to areas like real-estate and infrastructure where we think there’ll be an opportunity. But also similar to the other asset classes, looking to strategies like secondaries which is one where similar to private equity and venture capital. We think that our position is one of the leading limited partners and one of the leading primary capital allocators positions us very well as a replacement LP or someone to participate in secondary transactions.
So that continues to be an active area for our private debt colleagues as well.
Michael Cyprys: Okay. Thanks. And maybe just a follow-up question on realization backdrop continues to remain soft. As you mentioned, we’ve been hearing anecdotes from LPs that is starting to create liquidity challenges on their side. Are you starting to hear any sort of pressure points that LPs are pushing GPs to want to find liquidity events, maybe even selling assets at prices that GPs’ may not otherwise necessarily want to pursue an exit. Just curious how you’re seeing this all sort of play out here as you kind of look out over the next twelve months or so.
