Blue Owl Investors Pull 15% of Assets From Tech-Focused Fund
(Bloomberg) — Investors pulled about 15.4% of net assets from one of Blue Owl Capital Inc.’s technology-focused funds following the broker’s decision earlier this month to significantly increase the amount they can withdraw.
The firm allowed investors in Blue Owl Technology Income Corp., a business development company, to withdraw shares worth about $527 million of the non-traded fund’s net assets, according to a regulatory filing. Before the change, the fund limited refunds to about 5%.
The sharp pullback is one of the clearest signs yet of growing unease about private credit, a booming asset class that is under pressure due to a combination of high-profile losses, low return expectations and increased scrutiny from regulators and policymakers. BDCs, which pool private credit loans, have been hit particularly hard.
“During the fourth quarter of 2025, the BDC industry has seen a significant increase in bidding activity, a dynamic we have long recognized as characteristic of periods of increased market volatility,” Blue Owl said in an investor letter accompanying the filing.
Some of the refunds came from withdrawal requests from wealthy individuals in Asia, who make up a significant portion of the fund’s investor base, known as OTIC, Bloomberg previously reported.
“We have honored all tender requests to date at OTIC and have chosen to increase the amount available this quarter to continue doing so, always focusing on our serving investors,” a spokesperson said in a separate statement. “OTIC’s performance remains strong.”
Repayment demands increased net leverage to 1.05 times the debt/equity ratio. According to the letter, after investors cashed out, the fund had approximately $1.4 billion in liquidity, including cash, debt and large syndicated loans.
The 17% refund request granted by Blue Owl was the largest request by percentage the asset manager has ever received. Blue Owl operates five BDCs, the largest of which has more than $33 billion in assets under management.
To operate successfully, BDCs need to take in more money than they bring back. Net inflows are jeopardized when redemptions rise above 5 percent for a high period, which could mean the fund may have to sell its assets.
Partly to manage this risk, most funds have the option to prevent investors from withdrawing cash if claims exceed 5% of net asset value.
Last year, OTIC’s Class I shares returned 9%, bringing the inception-to-date annualized return to 10.8%, the firm said. Repayments on Blue Owl’s largest direct lender, Blue Owl Credit Income Corp., were 5.2%, totaling nearly $1 billion.
(Updated with additional context, starting in the eighth paragraph.)
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