Alts Fundraising Falls 8% in February as Stanger Flags Rotation to HALO Strategies
Alternative Investment fundraising for February 2026 totaled approximately $13.4 billion, an 8% decline from January. Interval funds narrowly surpassed business development companies in February with $2.9 billion and $2.87 billion, respectively, while tender offer funds followed at $2.1 billion.
The recent BDC fundraising slowdown has continued into 2026, with February sales down approximately 43% year-over-year and roughly 54% below the category’s all-time monthly high of $6.2 billion, set in March 2025. The data comes from investment banking firm Robert A. Stanger & Company Inc.
“Investor allocations across alternatives are beginning to realign toward HALO strategies – hard assets with low obsolescence – as market conditions evolve,” said Kevin T. Gannon, chairman and chief executive officer of Stanger.
The HALO acronym describes a strategic rotation away from “asset-light” growth stocks toward tangible, “real economy” businesses difficult to replicate or replace with artificial intelligence technology, such as those with massive physical infrastructure: logistics networks, energy assets, factories, and warehouses.
“While February monthly fundraising totals for BDCs declined 43% year-over-year and broader credit strategies declined 30%, real estate strategies, including [real estate investment trusts, Delaware statutory trusts], and closed-end funds increased 31%, with infrastructure deals also posting year-over-year growth,” added Gannon. “This coupled with the recent increase in BDC redemption activity is consistent with the early stages of a broader cycle transition.”
Fundraising in non-traded REITs and DSTs in February totaled $612 million for publicly registered non-traded REITs, $564 million for private placement REITs, and $741 million for DSTs. This is a 31% year-over-year jump from their February 2025 combined total.
“Earlier this month, we saw the BDC redemption pressure come to a head with HPS becoming the first publicly registered BDC to prorate Q1 redemption requests,” added Gannon. “After receiving requests of 9.3% of shares outstanding, HPS chose to fulfill up to the standard 5% quarterly cap. This came on the heels of Blackstone redeeming 7.9% of shares outstanding after a $400 million investment from Blackstone and its employees enabled them to fulfill 100% of Q1 redemption requests.”
The top 20 sponsors by year-to-date gross fundraising include Blackstone Inc. at 13% of market share, Kohlberg Kravis Roberts & Co. at 10%, Ares Management Corporation at 9%, Cliffwater LLC at 8%, and Blue Owl Capital Inc. at 6%.
Founded in 1978, Robert A. Stanger & Company is an investment banking firm providing advisory, valuation, and capital markets services to real estate investment trusts, partnerships, and related entities.
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