A new analysis from Robert A. Stanger & Company suggests the non-listed business development company (BDC) market may be entering the early stages of a liquidity cycle similar to the one experienced by non-listed REITs beginning in 2022. 

The research highlights a familiar sequence that has shaped other alternative investment markets: a period of strong fundraising followed by slowing inflows and rising redemption requests. That pattern ultimately reshaped the non-listed REIT market over the past several years, and early indicators suggest comparable dynamics may now be emerging within non-listed BDCs. 

For now, the sector remains stable. According to the report, no non-listed BDC currently has unmet redemption requests, even though several funds have exceeded their standard quarterly repurchase limits of 5%. Still, the combination of declining capital formation and increasing redemption activity has begun to resemble the early phases of the REIT liquidity cycle. 

The non-listed BDC market expanded rapidly alongside the growth of private credit. Strong demand for income-oriented strategies and rising interest rates fueled capital formation, which climbed from $3.5 billion in 2020 to $63.1 billion in 2025, making the sector one of the fastest-growing areas within alternative investments. 

Momentum, however, appears to be moderating. Stanger data shows fundraising has fallen nearly 50% from its early-2025 peak. When indexed against its high-water mark and compared with the historical trajectory of the non-listed REIT market, the fundraising slowdown and redemption patterns are beginning to look increasingly similar. 

Gross fundraising indexed to peak year = 100. Non-listed REITs (including DSTs) peaked in 2022; non-listed BDCs peaked in 2025. Source: Robert A. Stanger & Company, Inc. and Mountain Dell Consulting 

A slowdown in fundraising is not uncommon in cyclical markets, but what tends to follow can be more revealing, Stanger reported. In the non-listed REIT sector, redemption pressure continued for several quarters after capital inflows began to decline. Although withdrawals started to moderate around mid-2024, fundraising volumes have yet to return to the elevated levels reached in 2021 and 2022. 

Recent disclosures suggest the non-listed BDC market may now be entering a similar phase. Blackstone Private Credit Fund (BCRED) reported redemption requests equal to roughly 7.9% of NAV in the first quarter of 2026. To satisfy the requests, the fund raised its quarterly repurchase limit from 5% to 7% and received an additional $400 million investment from Blackstone and its employees. Other large BDCs have also met redemption requests ranging from 4% to 6%, while Blue Owl Technology Income Corp. repurchased more than 15% after increasing its tender offer. 

BREIT quarterly redemption requests (Q1 2022 – Q1 2025) vs. BCRED (Q2 2025–Q1 2026), overlaid quarter-for-quarter. 

Redemption requests at Blackstone Real Estate Income Trust (BREIT) first rose meaningfully in a quarter when withdrawals reached roughly 12% of NAV, before climbing to nearly 20% in the following quarter. Elevated redemption levels continued for another six quarters before eventually declining below the fund’s repurchase thresholds. By comparison, Blackstone Private Credit Fund (BCRED) reported redemption requests equal to 7.9% of NAV in the first quarter of 2026. 

“We have been tracking capital flows in non-listed alternatives for nearly five decades, and the sequence that typically drives these cycles is very consistent,” said Kevin T. Gannon, Chairman & CEO of Stanger. “Fundraising slows first. Redemption requests begin to rise over the following quarters. Eventually leadership must begin managing liquidity more proactively.” We call this the Stanger Liquidity Cycle, and what we are seeing today in the BDC market resembles the early stages of that process.”

The non-listed BDC market differs from the non-listed REIT sector in several key ways. Private credit portfolios typically consist of shorter-duration assets and benefit from more active secondary markets for loans, which can provide managers with greater flexibility to manage liquidity during periods of elevated redemption activity. 

Even so, the broader structural dynamics are similar. Both markets rely on continuous offerings funded largely by retail investors and employ share repurchase programs with quarterly limits. These structures function smoothly during periods of strong inflows but can face pressure when capital flows reverse. The experience in the non-listed REIT and DST markets illustrated how quickly investor sentiment can shift once redemption requests begin to rise. 

“Whether the BDC sector ultimately follows the same trajectory as non-listed REITs should become clearer over the coming months, as only four NAV BDCs have reported Q1 2026 tender offer results,” said Michael Covello, Executive Managing Director at Stanger.