Marc Zahr is co-president of Blue Owl Capital and global head of the firm’s real assets platform. He joined the company in 2021 when it acquired Oak Street, the net lease platform Zahr founded.
9fin caught up with Zahr to discuss the firm’s approach to Asia, the opportunities it sees here and the potential pitfalls to avoid.
1. Blue Owl's real assets business has grown from $12 billion when you joined in 2021 to almost $90 billion today. What have been the primary drivers of that growth?
We're not trying to be everything to everybody. We believe that growth has been supported by our focus on income-oriented investments, downside risk mitigation, and large addressable markets.
Oak Street became part of Blue Owl in 2021 with a differentiated net lease franchise and a long track record. Blue Owl added reach, with a broader investor base, permanent capital, and the ability to solve bigger capital needs. The $89 billion is the result of that discipline, not the goal.
2. How do you think about building a business that can perform across different market cycles?
We don't build the business around one rate path or one economic outcome. Instead, we aim to build each investment to withstand a range of them.
It comes down to tenant quality, lease structure, and the scale to be a real solutions provider. We buy at a disciplined entry point with 15 to 20 years of contractual cash flow growth, so short-term noise doesn't change the underwriting. One proof point: Blue Owl collected 100% of rents across all funds throughout Covid.
3. Blue Owl's net lease strategy has performed well in the US — can you talk us through it and offer views on whether this could be attractive in APAC?
Our approach is grounded in high-quality counterparties, mission-critical real estate, long-term contracted cash flows, and disciplined underwriting. Higher rates and volatility make long-duration, contractual income more valuable, not less. Today, we're focused on sectors like cold storage, healthcare, and data centers, each generally backed by investment-grade tenants on long leases.
Asia represents an important market for us. Investors across the APAC region have supported our real assets strategies for years, and we've seen strong interest in income-oriented investments backed by contractual cash flows and downside risk mitigation. As we evaluate investment opportunities across the APAC region, we're taking a selective approach, and are assessing which local markets may support opportunities that fit our investment criteria.
4. AI infrastructure has dominated conversations here in APAC, where even banks are eying ways to lend against GPUs. What part of the value chain does Blue Owl prefer to invest in, and do you see any pitfalls to avoid?
For Blue Owl’s real assets business, our focus is on the physical infrastructure underpinning AI growth. I'm not trying to predict the exact shape of the AI curve, and no one else can with certainty either. We prefer exposure through scarce physical infrastructure, backed by an investment grade tenant and a contract signed before we build.
If AI adoption keeps accelerating, that infrastructure may become more valuable. If it doesn't, we still own a hard asset generating rent from an investment-grade company for 15 to 20 years. The pitfall for investors is speculative development — buying land and hoping a hyperscaler shows up. Our discipline to avoid that strategy applies in Asia the same way it does anywhere else.
5. Real estate credit has emerged as one of the fastest-growing sectors in private markets. What is driving institutional appetite right now, and how durable do you think that demand is?
More than $3trn of commercial real estate debt will mature by 2030, all while banks are pulling back from lending. That gap is forcing a wave of refinancing into a market with less capital to meet it.
Borrowers, in turn, are turning to private lenders that can move with speed and certainty, and that's where we've built real scale. Those are the conditions that can potentially produce attractive risk-adjusted returns, and I don't see that changing soon.
6. The Fed has raised rates for the first time in a long while. What does the current rate environment mean for your business and the broader industry?
Rates are one factor among several, including credit spreads and capital availability. When financing conditions tighten, transaction volumes may decline but selective opportunities can also emerge for those investors with available capital and disciplined underwriting.
Long-term contractual cash flows may provide income visibility, although they remain subject to tenant credit, financing and valuation risks. We didn't build this platform to time rate cycles, and the current environment is proving why.
7. If you could change one thing about how the market currently thinks about real assets as an asset class, what would it be?
The market treats real assets as one homogeneous bucket, or a simple inflation hedge, and that's the wrong way to think about it. A real asset isn't defensive just because it's tangible. The contract, the counterparty, and the entry price determine the risk, not the label.
For instance, two data centers may look identical on paper: one backed by a AAA hyperscaler on a 20-year lease, the other speculative with no tenant in hand. Investors should be underwriting the contract, not the category.
8. Blue Owl has been growing its presence in Asia. How do you view the opportunity here relative to the US and Europe, and how does your approach differ?
Blue Owl has been expanding its firm-wide capital formation and distribution presence in Asia. From an investment perspective, we're always evaluating opportunities where our investment approach may be applicable, and Asia is one region we're continuing to assess select markets over time, rather than pursuing a footprint for its own sake.
The market opportunity is real. Asia is home to some of the world's fastest growing economies, with expanding corporate balance sheets and increasing appetite for private capital solutions. We’ve seen a similar development pattern in a number of private market strategies, with activity often becoming established first in the US, followed by Europe and other regions.
Finally, there’s a real catalyst building in that public market investors in much of the world are pushing companies to unlock the value sitting on their balance sheets — and that's exactly the kind of conversation we have with corporates everywhere. We're disciplined about it, but the opportunity set here keeps getting more interesting.
9. You’ve spent a good amount of time in Chicago. Many investors or tourists would shoot for New York, San Francisco or LA as their first US cities to visit. If you had to make the case for Chicago coming first, how would you do it?
I'll admit my bias — Chicago is where I grew up, built my career, and where we built Oak Street from scratch. But the case is real: the architecture, the food, the lakefront and a genuinely global city, with a directness you don't get in New York or LA.
This is also the city that gave the world Michael Jordan, the greatest of all time. But come in the summer, not February.
