The latest data reveals a dip in new Luxembourg alternative investment funds (AIFs) registrations since the first quarter of this year, though reserved alternative investment funds (Raifs) show resilience, driven by recent legislative updates and steady demand.
According to registration statistics reported by supervisor CSSF, the coming of new Luxembourg AIFs appears to have gone into a dip since the first quarter of this year. The count of the subset of AIFs registered as Raifs has been less affected and, as Raif experts have suggested, continues to be steady when considering both Raifs and sub-funds.
“The Raif structure is increasingly favoured, now surpassing specialised investment funds (SIFs)in popularity, with a 31% share compared to SIFs’ 30%,” said Renaud Oury, Apex Group’s chief growth officer. “This shift is partly due to recent legislative updates having modernised the Raif framework, aligning it more closely with other European fund structures.”
The CSSF dataset is slow to stabilise, with new funds being added over a roughly three-month period. The number of registered AIFs in March, April and May were 83, 88 and 72. This is notably lower than the numbers for the 4th quarter of 2023, with counts of 138, 122, and 140. It’s possible to see a reduction in registrations amid the reporting delay.
Raif vehicles underpin Luxembourg alternatives
Source: Investment Officer, based on the CSSF AIF identifiers dataset.
31 May data
This emerges from Investment Officer’s analysis of the CSSF ‹s AIF identifiers dataset as of 31 May. The CSSF data is one of two public datasets making it possible to see registration levels. The CSSF dataset, however, requires significant additional analysis due to the structure of the data.
Looking at all registered AIFs over the past year, Ireland-based Carne Global emerges as the clear “big gorilla” with 105 funds registered. That’s twice the number for the next biggest fund issuer, Fundrock LIS, part of the Bermuda-based Apex Group, with 52.
“In the last couple of years, we have also noticed increasing demand for the SCSp (special limited partnership) structure, said Des Fullam, chief regulatory and solutions officer at Carne. “This isn’t always a regulated fund vehicle; in fact, in 2023, growth for demand of non-Raif SCSps outstripped that of Raifs.”
Top 5
The top 5 of all Aifs continue with 47 for Blackstone Europe Fund Management, 44 for Alter Domus Management Company, and 40 for CVC Europe Fund Management in the past year.
Ireland’s Waystone Management Company registered 38 funds in the past year.
Looking at the past month, the leader table is topped by Janus Henderson Investors Europe, with 19 funds registered. They are followed by A&G Luxembourg AM, with 10, Fundrock LIS, with 6, Abrdn Investments (Luxembourg) with 6 and EQT Fund Management, with 4. The CSSF data for the last month is not yet finalised, however, as some funds usually are added retroactively.
Last month
Most of the big players for the past year don’t figure in the top 5 of the past month’s statistics, with Carne Global, in sixth place, with only 4 funds and Waystone Management with only 3.
Turning to Reserved alternative investment funds, a particular interest for our readers and filtering the dataset to look at sub-funds with “Raif” in their name, the data points to the usual suspects of frequent AIF/Raif registrations. Over the past year, the clear “big gorilla looking at the CSSF data is Carne Global Fund Managers (Luxembourg), which is head and shoulders above the other competitors looking over the last year, with 55 ‘Raif registrations.
“At a macro level, the main driver of the Raif market has been the wider growth in allocations to private markets,” said Fullam at Carne, who describes his firm as the “largest alternative investment fund manager (AIFM) for Raifs”. “In the lower interest rate environment that we experienced up until last year, investors were seeking higher-yielding products and were prepared to give up liquidity to achieve that higher yield via private markets funds.”
Raifs not sluggish
In second place, Blackstone Europe Fund Management registered 23 Raifs. The top three are rounded out by Fundrock LIS, part of the Apex Group. In fourth place and tied with Fundrock, Waystone Management Company also registered 22. Pictet Asset Management Company has registered 20 Raifs.
Commenting on the state of the Raif market, Markus Bannwart, department head of departmental capital markets fund structuring, took issue with any suggestion that the Raif market is sluggish. “Our business is mainly driven by asset owners and their demand is stable,” he said. “The current situation might be more challenging for asset managers/fund initiators.»
“Should there actually be problems distributing Raif funds, it is because of market developments, not because of the Raif product itself.”
Looking only at the last month, Carne Global FM leads with 4, followed by Fundrock LIS and M&G Luxembourg ties with 3, then Hauck & Aufhäuser Fund Services, tied with 2. The number of funds per AIFM drops quickly thereafter. The same proviso that recent CSSF data is still being finalised, applies.