Cohen & Steers Inc
NYSE:CNS
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Cohen & Steers Inc
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Ladies and gentlemen, thank you for standing by. Welcome to the Cohen & Steers, First Quarter 2022 Earnings Conference Call. During the presentation all participants will be in a listen-only mode. Afterwards we will conduct a question-and-answer session. [Operator Instructions]. As a reminder, this conference is being recorded on Thursday, April 21, 2022.
I would now like to turn the conference over to Mr. Brian Heller, Senior Vice President and Corporate Counsel of Cohen & Steers. Please go ahead.
Thank you, and welcome to the Cohen & Steers, First Quarter 2022 Earnings Conference Call. Joining me are our Chief Executive Officer, Joe Harvey; our Chief Financial Officer, Matt Stadler; and our Chief Investment Officer, John Shay.
I want to remind you that some of our comments and answers to your questions may include forward-looking statements. We believe these statements are reasonable based on information currently available to us, but actual outcomes could differ materially due to a number of factors, including those described in our accompanying first quarter earnings release and presentation, our most recent Annual Report on Form 10-K and our other SEC filings. We assume no duty to update any forward-looking statement. Further, none of our statements constitute an offer to sell or the solicitation of an offer to buy the securities of any fund.
Our presentation also contains non-GAAP financial measures referred to as adjusted financial measures that we believe are meaningful in evaluating our performance. These non-GAAP financial measures should be read in conjunction with our GAAP results. A reconciliation of these non-GAAP financial measures is included in the earnings release and presentation to the extent reasonably available. The earnings release and presentation, as well as links to our SEC filings are available in the Investor Relations section of our website at www.cohenandsteers.com.
With that, I'll turn the call over to Matt.
Thank you, Brian. Good morning everyone! As usual my remarks this morning will focus on our as adjusted results, which in addition to the customary items exclude cost of $15.2 million associated with the initial public offering of Cohen & Steers real estate opportunities and income fund.
A reconciliation of GAAP to as adjusted results can be found on pages 13 and 14 of the earnings release and on slides 16 through 19 of the earnings presentation. Yesterday we reported earnings of $1.04 per share compared with $0.79 in the prior year's quarter and $1.24 sequentially. The fourth quarter of 2021 included cumulative adjustments to compensation and benefits and income taxes that lowered our compensation to revenue ratio and effective tax rate respectively.
Revenue was $154.3 million for the quarter compared with $125.8 million in the prior year's quarter and $159.7 million sequentially. The decrease in revenue from the fourth quarter was primarily due to two fewer days and performance fees earned in the fourth quarter on certain institutional accounts. No performance fees were recorded in the first quarter.
Our effective fee rate was 57.6 basis points in the first quarter, compared with 58.1 basis points in the fourth quarter. Excluding performance fees, our fourth quarter effective fee rate would have been 57 basis points. Operating income was $68.9 million in the quarter compared with $53.2 million in the prior year's quarter and $82.6 million sequentially.
Our operating margin decreased to 44.7% from 51.7% last quarter. The fourth quarter included an adjustment to reduce the full year 2021 incentive compensation accrual to reflect actual amounts paid. Expenses increased 10.7% when compared with the fourth quarter as higher compensation and benefits were partially offset by lower G&A and distribution and service fees.
Compensation to revenue ratio for the first quarter was 33.75%, consistent with the guidance provided on our last call. The decrease in G&A was primarily due to lower recruitment fees, a decrease in travel and entertainment and a reduction in hosted conferences. And a decrease in distribution and service fee expense, which as mentioned earlier excludes the costs of our new closed-end fund, which primarily due to two fewer days in the quarter and lower commission expenses resulting from a decrease in load share class activity.
Our effective tax rate was 25.5% for the quarter, lower than the guidance provided on our last call. The reduction in the effective tax rate was primarily due to lower state and local income taxes.
Page 15 of the earnings presentation, sets forth our cash and cash equivalents, corporate investments, and U.S. Treasury Securities and liquid seed investments for the current and trailing four quarters. Our firm liquidity totaled $180.7 million at quarter end compared with $248.2 million last quarter. Firm liquidity as of March 31 reflected the payment of bonuses, as well as the firm's customary repurchase of common stock to satisfy employee withholding tax obligations arising from the vesting and delivery of restricted stock units on behalf of participating employees. In addition, during the first quarter we paid $15.2 million of costs associate with the IPO of our new closed-end fund, and we continue to be debt free.
Assets under management totaled $102.1 billion at March 31, a decrease of $4.5 billion or 4% from December 31. The decrease was due to market depreciation of $4.6 billion and distributions of $697 million, partially offset by inflows of $756 million. This marks the 11th consecutive quarter we have recorded net inflows.
Advisory accounts had net outflows of $420 million during the quarter, compared with net outflows of $456 million during the fourth quarter. We recorded $1.6 billion of inflows, $492 million of which were from new mandates and $1.1 billion of which were from existing accounts. Offsetting these inflows were $1.6 billion of outflows. One U.S. client who still maintains assets with us, terminated an opportunistic U.S. Real Estate portfolio that was funded at the outset of the pandemic drawdown in April 2020, and a few others rebalanced their accounts. Joe Harvey will provide an update on our flows and institutional pipeline of awarded unfunded mandates.
Japan sub-advisory had net inflows of $116 million during the quarter compared with net outflows of $242 million during the fourth quarter. The last time we recorded net inflows from Japan sub-advisory was the fourth quarter of 2020. Distributions from these portfolios totaled $271 million compared with $276 million last quarter. Sub-advisory excluding Japan had net outflows of $80 million, primarily due to a few clients rebalancing their portfolios.
Open end funds had net inflows of $208 million during the quarter with outflows from preferred securities portfolios being more than offset by inflows into U.S. Real-Estate, global Real-Estate and multi-strategy real assets portfolios. And closed-end funds recorded $554 million of inflows, primarily due to the IPO of Cohen & Steers’s Real-Estate opportunities and income fund.
Now I'd like to briefly discuss a few items to consider for the second quarter and the remainder of the year. With respect to compensation and benefits we expect that our compensation to revenue ratio will remain at 33.75%. We still expect G&A to increase 10% to 15% from the $47.2 million we recorded in 2021, as we continue to make incremental investments in technology, including the implementation of new systems, cloud migration and upgrades to our infrastructure and cyber security framework.
We also expect that both travel and entertainment and sponsored conference costs will increase as global conditions continue to return to pre-pandemic levels. And finally, we expect that our effective tax rate will remain at 25.5%.
Now I'd like to turn it over to our Chief Investment Officer, John Shay, who will discuss our investment performance.
Thank you, Matt and good morning. Today I'd like to briefly cover three areas: First, our performance scorecard; second, the current investment environment; last, global listed infrastructure, one of the key solutions we believe investors will need in this new investment regime.
Turning to performance, in the first quarter seven of nine core strategies outperformed their benchmarks. For the last 12 months, once again all nine of nine core strategies outperformed. Measured by AUM, 98% of our portfolios outperformed their benchmark on a one year basis; a very slight decline from 99% last quarter. On a three and five year basis, 100% of our AUM is outperforming, consistent with last quarter.
From a competitive perspective, 91% of our open-end fund AUM is rated four or five star by Morningstar, compared with 86% last quarter with a big and important upgrade for our multi-strategy real assets fund from two to four stars.
By all measures, our investment performance is strong and with good breadth. I want to thank each and every person on our investment team, from risk, trading, business management, macro, PMA's, associates, analysts and PM's; really incredible drop job. We're especially proud that we've been able to deliver alpha for our clients in various market cycles and managed around trade wars, the pandemic, inflation, war and now a new rate hiking cycle. To us, great investment performance isn't about putting up one or two flashy quarters, instead it is a marathon which we can win with strong teams, with good cultures, executing on a consistent process and with the healthy desire to keep improving. We believe in consistency. If we are consistently top quartile in the long run, we know we will be top decile.
Now in order to stay ahead, we also continue to invest resources in ESG integration, multi asset solutions, quantitative analysis and thematic and secular research. Shifting from our performance to the investment environment, Q1 2022 will go down at the tipping point, where the consensus shifted from a 20/10s low rates low inflation regime to a 20/20s higher rates, higher inflation regime. This new regime which we've been discussing with our investors for the last 18 months is being driven by three major factors. Number one, highly supportive fiscal policy; number two, de-globalization and reshoring trends; and number three, the energy transition and the under investment in traditional resources.
In this context, both equities and bonds saw losses in Q1 of 4.6% in the case of the S&P 500 and the loss of 6.2% in the case of the Bloomberg Global Aggregate. The traditional 60/40 portfolio had a historically poor quarter. In contrast, listed real assets generally outperforms led by commodities, MLP's, natural resource equities and global listed infrastructure, which all posted positive returns year-to-date. Our flagship diversified real asset strategy was up 10.1% in the quarter, demonstrating its ability to provide equity like returns, inflation sensitivity, and diversification versus a core stock bond portfolio.
After a very strong 2021 where U.S. and global real-estate both outperformed equities, quarter-to-date U.S. and global real-estate were down 5.3% and 4.0% respectively. Three things to keep in mind about real-estate: First, fundamentals in U.S. real-estate are very strong and are about as strong as they've been in the 25-plus years of my career.
Second, real-estate tends to do better in inflationary environments, given their higher margin businesses that are not labor commodity intensive, plus they benefit over time with rental pricing power as construction costs rise, which prevents new supply from coming on. This cycle, the supplier response in some sectors has been more immediate rather than with a lag.
Third, contrary to investor misconceptions about the relationship between REITs and rates, during the last two rate hiking cycles which began in 2004 and 2015, during the six month period after such rate hikes commenced, U.S. REITs on average increased 16%, outperforming U.S. equities by 11%. Consistent with that, since the Fed raised rates last month, REIT’s are up about 8% versus the S&P now up about 5%.
Moving to preferred securities, core and limited duration preferred securities were down 5.7% and 3.2% respectively, but in both cases outperformed the global aggregate from both an income and total return perspective.
Going forward we expect core preferreds to continue to be corporate bonds as they offer both lower duration, 4.5 years versus 8 years and 150 to 200 basis points of greater income. Our limited duration preferreds offering with design for this environment, with duration of just 2.2 years and we think this fund is positioned as an inflation fighter.
Markets right now are saying inflation will average around 3.5% for a few years, and this fund offers tax advantage income above that, along with the potential for income bumps due to resets and bond rollovers. The higher the inflation, the higher the income bump is likely to be. In 2018 the top of the last hiking cycle, we raised the dividend twice.
So overall within preferreds, we positioned our funds defensively. We do expect inflation to calm down some over time and for investors to continue to value the high income, modest or low duration, tax advantages and high quality of preferreds.
Turning the focus to listed infrastructure, while we expect inflation will moderate some, and the pace of rate rises may slow, we do believe the general shift is durable and has important implications. Investors have begun and will continue to look for alternatives, listed and private, to deliver on income, total return, diversification and inflation sensitivity. We believe our global list of infrastructure strategy will be one of the most effective solutions for investors for the regime ahead.
Preqin recently reported that as of December 31 there was $331 billion of dry powder raised for private infrastructure. Investors clearly value the attributes of infrastructure, which include its tangible nature, income, defensive growth and positive inflation sensitivity. In other words, exactly what they need and want for the foreseeable future. But these long and growing investment cues imply great difficulty in accessing these attributes.
We strongly believe listed infrastructure, a $5 trillion market offers many of the same long term investment attributes, but can be accessed immediately, more affordably and without locking oneself up for years. We're suffering through the J curve of PE investments.
Over the last 10 years, our infrastructure strategy has delivered 10.4% annually. More recently listed infrastructure, up 3.7% this year materially outperformed global equities, a 5.2% decline in the first quarter, highlighting the downside protection in inflation beta characteristics of the asset class.
Several dynamics are providing tailwinds for the asset class today, notably infrastructure has historically outperformed during periods characterized by slowing economic growth and persistent inflation. In addition, that same private infrastructure capital continues to find its way into the listed markets as these long term investors see value in listed core infrastructure businesses. These transactions are coming at significant premiums compared to where the listed companies are trading, supporting our view that the public infrastructure markets are attractively priced relative to both, broader equities and private market valuations.
Overall, we see global listed infrastructure as an all-weather, full cycle solution for investors to access the attractive attributes of infrastructure immediately, cost effectively and at a cheaper valuation than private markets.
With that, I'll turn the call over to Joe Harvey.
Thank you, John and good morning. I appreciate the opportunity to report to you for the first time as CEO on the state of our business. Macroeconomic, geopolitical and market conditions in the first quarter couldn't have shifted faster, nor been more different from the fourth quarter. Fortunately, our business fundamentals have had strong momentum. That said, some trends have shifted and I will outline them for you.
The macro shifts are fairly evident, starting with inflation at 40 year highs and headline CPI at 8.5%. As a result, the fed has been forced to raise rates and withdraw liquidity; we've been expecting that for some time. However, increased geopolitical tensions resulting from the unexpected Russian invasion of Ukraine, as well as escalating concerns about de-globalization and supply chain constraints could conspire to sustain inflation pressures.
Accordingly, there have been major reversals in asset class, in sector performance trends such as from tech equities to natural resource equities and factor reversals such as from growth to value, not surprisingly concerns about recession arising. It's hard to see a recession through the lens of the labor market and consumer, which are very strong. The economy has underlying strength, but will be tested with broadside hits of monetary tightening and inflation and uncertainties about war and the tragedy in Ukraine.
This is an unprecedented period in history for the economy. We are now factoring in an economic slowdown without a recession, persistent inflation and higher interest rates with less than expected hikes, because inflation combined with higher rates will doubly pump the brakes on the economy.
Turning to our business, our investment performance has remained strong as John outlined. With our recent percent of AUM outperforming for three – one, three and five years, now at almost perfect levels, some perspective is in order. Evercore ISI's data show that just 20% of active U.S. equity strategies outperformed in 2021.
Looking at the longer term record, aggregating all of our strategies, our alpha has been 275 basis points per year over the past 10 years. So kudos to our investment teams for performing at such a high level. Our performance combined with rising demand for our strategies has enabled us to produce consistent organic growth.
In the first quarter we recorded $756 million of inflows, which extends our positive organic growth record to 25 out of the past 29 quarters. All strategies except preferred securities had inflows, illustrating the diversity of our line up. Flow patterns have been rational. Inflation catalyzed continued flows into U.S. real estate, global real estate, listed infrastructure and multi strategy real asset portfolios, while the shift in fed policy prompted some investors to sell preferreds with our core and low duration strategies.
Open-end net inflows were $208 million, the 13th quarter in a row of net inflows, but the lowest quarter since the first quarter of 2020. While U.S. open-end funds were slightly negative at $65 million, our strengthening offshore SICAV funds had $97 million in inflows, and our UMA, SMA platforms showed continued strength with $177 million in inflows. We continue to be optimistic about our SICAV line up after we changed leadership for our sales effort over a year ago and implemented a new distribution strategy.
For U.S. open-end funds gross sales in the first quarter were consistent with levels over the past year, so increased redemptions account for the net outflows. Our flagship preferred fund CPX had the weakest results ever with $943 million in net outflows, which was punctuated by a total of $500 million from two allocators.
Bright spots in our open-end fund activity are connected to the inflation theme, including U.S. and global real estate strategies, listed infrastructure and our real assets, multi strategy portfolios, which include resource equities and commodities, some of the best performing markets in the first quarter. We also saw our 15th straight quarter in defined contribution investment only or DCIO inflows.
Closed-end funds had $554 million in inflows, driven primarily by the IPO of our Cohen & Steers Real Estate Opportunities Income Fund, which raised $482 million including leverage. While the raise was less than we would have hoped for when we started the process, we are pleased with the result considering that we priced the night of the Ukraine invasion and we are proud of the effort across our company and thankful for our distribution partners’ execution.
We had conviction in the entry point for investors and are pleased with the short term results with NAV growth thus far at roughly 8% and our dividend rate declared at 6.25%. Institutional advisory had net outflows of $42 million, which was disappointing, but belies the strength in that segment. Our momentum in institutional advisory was offset by take backs of certain accounts that have been added opportunistically during the pandemic drawdown.
For example, one real estate client funded an opportunistic account in April 2020 that enjoyed a 34% return. They've declared the victory and redeemed that sidecar. Notwithstanding the third quarter of outflows, we are pleased with our leadership and advisory and execution of our business plan, and we see strength in several areas, including increases in consultant ratings, mandates via outsourced CIO's, in demand in EMEA, especially the Middle East.
In terms of Japan sub-advisory, we saw improvement with $116 million of net inflows excluding distributions. The uptick in Japan is due to strong absolute and relative performance in real estate strategies over the past year, plus U.S. dollar strength. Our one, but unfunded pipeline continues to be above trend line and stands at $1.5 billion compared with $2.1 billion last quarter.
Within the quarter there was $137 million that was both one unfunded and therefore never appeared in the pipeline. The pipeline is comprised roughly of one-third in listed infrastructure mandates and two-thirds in global real estate mandates, with over half coming from top ups into existing accounts.
We continue to see strength in our business due to the strong investment performance and demand for our strategies. Allocations to listed real assets continue to rise and the trends are migrating to other parts of the world. In the Middle East where investors historically invested in private real estate, we began seeing demand for listed real estate and infrastructure about two years ago. And in Asia we're seeing momentum for inflation solutions and listed real asset allocations.
In real estate, allocation trends are rational in terms of investment decision making and make us bullish on our opportunity set. We see investors shifting from passive to active, because active works in REITS, and we seek reallocations from core private real estate to REITS, because listed has outperformed private on a standalone basis. And as we've discussed on prior calls, investors are more agile in moving between the listed and private markets. All of this supports the thesis behind our private real estate initiative and the integration of listed and private allocations in investor portfolios.
Our capital raising and vehicle development in private real estate are well underway. As mentioned on the last call, we continue to add to our private team and supporting infrastructure and commenced making acquisitions. We also see acceleration in demand for listed infrastructure, consistent with the investment case that John laid out. Adoption in the work channel is accelerating, meantime the backlog institutionally, both current search activity and in shadow pipelines is broad.
In terms of business strategy, we are actively focused on a number of fronts, including continued organic growth, innovating and broadening our investment capabilities, developing inflation solutions, capitalizing on the closed end fund 2.0 market, launching our private listed real estate strategies, and importantly, adding to and developing our talent.
I'll close with some thoughts on our multi-strategy, real asset capabilities. This has been a vision of Bob Steers and has been an ongoing strategic initiative. We believe it's a great way to engage with clients and discuss how to build better portfolios through a real asset line up. Looking backward over a period of disinflation, this initiative hadn't achieved its full potential. However, with the massive inflation surprise that we're experiencing, it could be that our time has come for this vision.
Looking ahead, inflation will certainly decline at some point. What's changed though is the mindset. Investors have been reminded of inflation risk, and why allocations to inflation solutions are so important. When I think about our clients who have allocated to this strategy over the past three years, I'm very proud of what we have delivered in terms of inflation protection, diversification, absolute returns and alpha.
While adoption of multi strategy real assets was slow at the outset, we continue to invest in the effort. We've refined our investment strategies, created new vehicles and added asset allocation and quantitative capabilities to help investors customize and allocate it. Recently we received ratings upgrades from Morningstar to four stars for our U.S. mutual funds and five stars for our SICAV.
Now that inflation has taken hold of the headlines, we believe that these strategies will be more consistently in demand. Meantime, investors are starting to focus on the capital and time needed to transition to a green economy and how that will tax natural resources and be another potential driver of inflation. We will continue to educate investors through our real assets institute and REIT academy and will continue to work with investors to build better portfolios with our strategies individually and as a package with asset allocation overlays.
Thank you for listening. Operator, could you please open the lines for questions.
Thank you. [Operator Instructions]. Our first question comes from John Dunn with Evercore ISI. Please proceed.
Hey guys! Can you talk a little bit about what do you think the next phase of getting even deeper and broader in the wealth channel looks like, and in the U.S., but maybe a little also what's going on in Europe.
Sure, let me start with Europe, because I said – as I mentioned in my comments, things are getting better there.
We changed leadership for our sales effort about a 1.5 year ago and to say it simply, we got the right person in place, we put the right team in place and we changed our distribution strategy a little bit to get more focused.
Initially we tried to target too broad of a market, so we are very focused on the U.K. and discretionary Portfolio Manager platforms and so we've been signing up platforms, getting share classes in place, and we're starting to see flows and one of the most important gaining factors is to have gotten those SICAV vehicles to critical mass, so that larger platforms can use them, and so that they are not too large percentage of those funds.
So when you combine our investment performance, the fact that our strategies are in demand and what has been great execution on the distribution front, we are seeing acceleration inflows. A great example of that is our real assets, our multi strategy real asset SICAV, which has seen very consistent flows and it's probably not a surprise considering the inflation environment.
In the wealth channel in the U.S, as you know, because you've been following us, that's been a leader of our organic growth for several years now. So I would say, you know there is not a lot to do to make it better other than keep chugging along and we are expanding our national accounts capabilities to just broaden our reach. We've made a lot of investments in our wealth area, including in DCIO and as my comments reflected, we've been seeing consistent results out of DCIO. We’ve also had your good results in the Bank Trust channel.
We've got a short term challenge with the interest rate environment and our preferred securities strategies, but as you saw in the results, we've got a nice diversifying effect with our other strategies which have been very responsive to the inflation trend.
So our bigger challenge in the wealth channel will be to – once we've finalized our vehicles in private and combine private and listed real estate strategies to bring those strategies to the wealth market and we've got a great presence as a real estate asset manager in wealth, but private is a little bit different. So that will be what we are focused on over the next couple of years.
Our next question comes from Alex Bond with KBW. Please proceed.
Hi! This is Alex on for Rob Lee. I’m just wondering, if you might be able to share what the rest of the year may look like regarding any additional closed-end bond offerings.
Sure. Well, just to back up, the closed end fund market is a strategic initiative for us considering how the vehicles have evolved to be more favorable for the investor, just to remind everybody. Asset managers in closed-end fund market today on new issues pays the upfront load for the investors, so investors invest $1 and get $1 put to work. And so that combined with a limited duration, a lifetime of 12 years with an option to extend have addressed some of the key challenges that the closed end fund market has had historically. So that combined with the ability to put unique investment strategies in closed-end funds, i.e., those with less liquidity make us bullish and this is a strategic priority for the firm.
Over the past couple of years we've done to funds. One is a preferred stock fund, PTA, which was a very successful, we hit the market at the right time, and then I talked about our most recent real estate strategy. Just looking out, right now I’d say the market conditions aren't great to be bringing new closed-end funds to market, but that could change at any time and so we're doing all the prep work. We have one fund on file with the SEC, it's an infrastructure fund. We do have three other ideas that range from really great to good, and we're going to be in the process of refining those strategies and being ready to come to market if the conditions are right.
Our next question comes from Marla Backer with Sidoti. Please proceed.
Thank you. So I would like to follow up on your answer, the answer that you just provided. So coming to market with the new fund as you've said is very much contingent upon market performance and the overall environment. Should we think that you are already incurred most of the costs, not associated with launching a new funs but with managing that fund in advance and so we'll see some extra costs in advance, and likely no uptick after the fund has launched?
Well, with the fund that we brought to market in February, you see the upfront offering costs flow through our financials and that is completed. In terms of the cost of managing that strategy, it's done with our existing teams. So there are no incremental costs, apart from what we're doing in our business strategy, already associated with that fund.
And the funds that were thinking about, opportunistically launching would be the same.
That’s correct. Good point Matt. That for all of the strategies that I mentioned, the one we filed plus of the ones that we’re designing, that would not require any additional investment capabilities. If we are fortunate enough to get to market, there would be the associated offering costs, but no additional investment team costs with those new offerings.
[Operator Instructions] Our next question comes from John Dunn with Evercore ISI. Please proceed.
Hi! Can you maybe give us a little updated on the push in U.S. advisory and separately maybe an update on what’s going on in the OCO - OCIO space, institutions increasingly looking to outsource stuff?
Sure! Advisory, if you’ve been following us, I know you have John, over the – starting about three year ago we started to reorganize our distribution effort overall, but specifically with the respect to advisory, because we felt like we could achieve better results. We weren't seeing our fair share of the market.
We've done several things, we've reorganized coverage to go to a regional model, both in the U.S. and we've organized teams by the specific function within the sales channel, meaning sales, consultant relations, relationship management. And we brought in some new personnel and as I mentioned in my comments, we are very pleased with the execution of that strategy with – we are really pleased because we're seeing upgrades with consultant ratings; we've got a lot of activity.
Unfortunately in the quarter because we've had a lot of redemptions as investors have realized the benefits of the recovery post pandemic, it really doesn't reflect what we are doing in an advisory. We just recently completed the addition of our sales team with two more professionals towards the end of last year and that, it will take them a little bit of time to get wrapped up, but based on all the factors that I cited, I'm confident that we're going to be a very successful institutional advisory. In terms of the OCIO market, it's a really important market because that's where money is flowing.
Many institutions need to outsource their investment functions, because of staffing constrains and there are several different types of outsourced CIO organizations ranging from the traditional consultant organizations to financial institutions groups, to independent OCIOs and that's where the money is flowing and being aggregated, and we’ve been organizing ourselves to engage with them, based on the different business models that each of those three categories have.
We have been seeing success with that, and I think the numbers over the past year, we've raised about $1.5 billion through OCIO mandates, and some of it doesn't flow precisely through our reporting construct that we have, some of it flows through our open end funds as well because some of these are smaller investors. They get aggregated through consultants and they use our institutional funds. So it's – you are going to see the effects of the OCIO market and a couple of our reporting areas.
But as I said in my comments, we are very optimistic of our opportunity set, particularly since the demand for our strategy is growing you know around the world. In EMEA things are very active. In Asia, it's been very spotty, looking backwards, but I think it's in part catalyzed by the inflation dynamic, but we're starting to see more and more interest in our strategies in Asia.
Mr. Harvey, there are no further questions at this time. Please continue with your presentation or closing remarks.
Great! Well, thanks for spending some time with us, and we look forward to talking to you next quarter. Have a great day!
Ladies and gentlemen, that does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your line. Have a great day everyone!