Brookfield sees record US$34 billion in inflows

Strong demand for real estate, credit offerings

Brookfield Asset Management Inc. posted record inflows of US$34 billion in the third quarter as investors sought higher yields in a low interest-rate environment.

The company cited strong demand for its real estate and credit offerings, bringing in a total of US$24.8 billion for funds focused on those areas. That helped fee-related capital surge to US$341 billion, Brookfield said in an earnings statement Thursday.

Brookfield is further accelerating fundraising with the expectation that rates are “poised to remain lowish for longer,” chief executive Bruce Flatt said in a letter to investors Thursday. The company also stands to benefit from an economic rebound that’s driving markets higher.

“Gross domestic product growth has been strong, labour markets have continued to improve, and capital markets remain very constructive,” Flatt said. “As owners of real assets and businesses, most of which can raise prices contractually or with inflation, we are well positioned in this environment.”

Alternative asset managers are seeing strong demand from investors. Private equity giants including Apollo Global Management

Inc. and Carlyle Group Inc.

WE REMAIN FOCUSED ON EXECUTING OUR GROWTH PLAN.

are raising record sums. Toronto-based Brookfield plans to raise US$125 billion for the next round of its flagship funds after it brings in US$100 billion in the current round, Flatt said in September.

The alternative asset manager said it earned a profit attributable to shareholders of US$797 million or 47 cents per diluted share for the quarter ended Sept. 30.

The result compared with a profit of US$172 million or 10 cents per diluted share in the same quarter last year.

Revenue totalled US$19.25 billion, up from US$16.25 billion a year ago.

Funds from operations totalled US$1.41 billion or 85 cents per share in the quarter, up from US$1.04 billion or 65 cents per share in the same quarter last year.

Distributable earnings rose to US$1.24 billion compared with US$890 million a year ago. Brookfield shares rose 1.8 per cent in early trading in New York, but slipped back, closing down 2.4 per cent at US$58.94. The stock has returned 48 per cent this year through Wednesday.

“We remain focused on executing our growth plan of doubling the size of the business over the next five years,” Nick Goodman, chief financial officer of Brookfield, said in a statement.