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COMMITMENTS AND CONTINGENCIES | 9 Months Ended
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Sep. 30, 2025
Commitments and Contingencies Disclosure [Abstract] |
COMMITMENTS AND CONTINGENCIES | 8. COMMITMENTS AND CONTINGENCIES Indemnification Arrangements Consistent with standard business practices in the normal course of business, the Company enters into contracts that contain indemnities for affiliates of the Company, persons acting on behalf of the Company or such affiliates and third parties. The terms of the indemnities vary from contract to contract and the Company’s maximum exposure under these arrangements cannot be determined and has not been recorded within the Condensed Consolidated Statements of Financial Condition. As of September 30, 2025, the Company has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote. Commitments As of September 30, 2025 and December 31, 2024, the Company had aggregate unfunded commitments to invest in funds it manages or to support certain strategic initiatives of $1,513.6 million and $1,451.4 million, respectively. Guarantees As of September 30, 2025 and December 31, 2024, the Company’s maximum exposure to losses from guarantees was $183.5 million and $1.1 million, respectively. The guarantee agreements that the Company enters into with financial institutions are primarily to guarantee credit facilities held by certain funds. In the ordinary course of business, the guarantee of credit facilities held by funds may indicate control and result in consolidation of the fund. Contingent Liabilities GCP International In connection with the GCP Acquisition during the first quarter of 2025, the Company established two arrangements with the sellers and with certain of its professionals that became employees of the Company, including (i) an earnout arrangement related to the data center business (“DC Earnout”) based on the achievement of revenue targets of certain digital infrastructure funds; and (ii) an earnout arrangement related to the Japan business (“Japan Earnout”) based on the achievement of fundraising targets of certain Japanese real estate funds. The DC Earnout and Japan Earnout represent contingent liabilities not to exceed $1.0 billion and $0.5 billion, respectively. The portion of the DC Earnout and Japan Earnout attributable to the sellers represents a component of purchase consideration that will be accounted for as contingent consideration. As of March 1, 2025, the fair value of these contingent liabilities was $465.1 million and was recorded within accounts payable, accrued expenses and other liabilities within the Condensed Consolidated Statements of Financial Condition. The contingent liabilities are subject to change over the measurement periods, which will end no later than June 30, 2028. Changes in fair value from the acquisition date will be recorded within other income (expense), net within the Condensed Consolidated Statements of Operations. The Company expects to settle the contingent liabilities at the Company's discretion with no less than 15.0% cash and the remaining balance in equity. As of September 30, 2025, the fair value of the contingent liabilities was $507.6 million and recorded within accounts payable, accrued expenses and other liabilities within the Condensed Consolidated Statements of Financial Condition. For the three and nine months ended September 30, 2025, the change in fair value of $17.0 million and $42.5 million, respectively, is presented within other income (expense), net within the Condensed Consolidated Statements of Operations. The portion of the DC Earnout and Japan Earnout attributable to the professionals that became employees of the Company requires continued service through the measurement periods. The Company expects to settle the contingent liabilities at the Company's discretion with no less than 15.0% cash and the remaining balance in equity awards. The DC Earnout and Japan Earnout are remeasured each period with incremental changes in fair value for the cash and equity components of these liabilities recognized within compensation and benefits expense within the Condensed Consolidated Statements of Operations. Following the measurement period end dates, the cash components will be paid and the equity awards will be granted at fair value for the balance of the liability. As of September 30, 2025, the fair value of the contingent liabilities was $217.5 million. Compensation expense of $14.7 million and $32.7 million for the three and nine months ended September 30, 2025, respectively, is presented within compensation and benefits within the Condensed Consolidated Statements of Operations with an equal offset presented within accrued compensation within the Condensed Consolidated Statements of Financial Condition. The unpaid liabilities at the respective measurement period end dates will be reclassified from liability to additional paid-in- capital. Any compensation expense associated with the DC Earnout and Japan Earnout that was not previously recorded through the final measurement period end date will be recognized as equity-based compensation expense over the remaining service periods ranging from three to six years, measured from the GCP Acquisition close date. Other Arrangements The Company also entered into various other contingent arrangements in connection with acquisitions. The maximum exposure for these contingent arrangements was $215.0 million and $155.0 million as of September 30, 2025 and December 31, 2024, respectively. Certain portions of these contingent arrangements require continued service through the measurement periods. As of September 30, 2025 and December 31, 2024, the fair value of these contingent liabilities was $124.1 million and $99.6 million, respectively, and the Company has recorded $58.7 million and $29.9 million, respectively, within accrued compensation within the Condensed Consolidated Statements of Financial Condition. Compensation expense of $10.1 million and $5.4 million for three months ended September 30, 2025 and 2024, respectively, and $28.8 million and $16.4 million for the nine months ended September 30, 2025 and 2024, respectively, is presented within compensation and benefits within the Condensed Consolidated Statements of Operations. The remaining portions of these contingent arrangements did not require continued service through the measurement periods and were classified as contingent consideration. As of September 30, 2025 and December 31, 2024, the fair value of these contingent liabilities was $20.4 million and $17.6 million, respectively, and has been recorded within accounts payable, accrued expenses and other liabilities within the Condensed Consolidated Statements of Financial Condition. Other expense of $0.4 million and $2.8 million for the three and nine months ended September 30, 2025, respectively, is presented within other income (expense), net within the Condensed Consolidated Statements of Operations. Carried Interest Carried interest is affected by changes in the fair values of the underlying investments in the funds that are advised by the Company. Valuations, on an unrealized basis, can be significantly affected by a variety of external factors including, but not limited to, public equity market volatility, industry trading multiples and interest rates. Generally, if at the termination of a fund (and increasingly at interim points in the life of a fund), the fund has not achieved investment returns that exceed the preferred return threshold or the general partner has received net profits over the life of the fund in excess of its allocable share under the applicable partnership agreement, the Company will be obligated to repay carried interest that was received by the Company in excess of the amounts to which the Company is entitled. This contingent obligation is normally reduced by income taxes paid by the Company related to its carried interest. Senior professionals of the Company who have received carried interest distributions are responsible for funding their proportionate share of any contingent repayment obligations. However, the governing agreements of certain of the Company’s funds provide that if a current or former professional does not fund his or her respective share for such fund, then the Company may have to fund additional amounts beyond what was received in carried interest, although the Company will generally retain the right to pursue any remedies under such governing agreements against those carried interest recipients who fail to fund their obligations. Additionally, at the end of the life of the funds there could be a payment due to a fund by the Company if the Company has recognized more carried interest than was ultimately earned. The general partner obligation amount, if any, will depend on final realized values of investments at the end of the life of the fund. As of September 30, 2025 and December 31, 2024, if the Company assumed all existing investments were worthless, the amount of carried interest subject to potential repayment, net of tax distributions, which may differ from the recognition of revenue, would have been approximately $125.5 million and $59.6 million, respectively, of which approximately $99.7 million and $39.5 million, respectively, is reimbursable to the Company by certain professionals who are the recipients of such carried interest. Management believes the possibility of all of the investments becoming worthless is remote. As of September 30, 2025 and December 31, 2024, if the funds were liquidated at their fair values, there would be no material contingent repayment obligation or liability. Litigation From time to time, the Company is named as a defendant in legal actions relating to transactions and other matters conducted in the ordinary course of business. Although there can be no assurance of the outcome of such legal actions, in the opinion of management, the Company does not have a potential liability related to any current legal proceeding or claim that would individually or in the aggregate materially affect its results of operations, financial condition or cash flows. Leases The Company’s leases primarily consists of operating leases for office space and certain office equipment. The Company’s leases have remaining lease terms of one to 18 years. The tables below present certain supplemental quantitative disclosures regarding the Company’s operating leases:
Maturity of operating lease liabilities |  |  | As of September 30, 2025 |  |
2025 |  |  | $ | 22,315 |  |  |
2026 |  |  | 75,796 |  |  |
2027 |  |  | 69,136 |  |  |
2028 |  |  | 79,184 |  |  |
2029 |  |  | 73,448 |  |  |
Thereafter |  |  | 714,940 |  |  |
Total future payments |  |  | 1,034,819 |  |  |
Less: interest |  |  | 358,447 |  |  |
Total operating lease liabilities |  |  | $ | 676,372 |  |  |
|  | Three months ended September 30, |  | Nine months ended September 30,
Classification within general, administrative and other expenses |  | 2025 |  | 2024 |  | 2025 |  | 2024 |  |
Operating lease expense |  | $ | 22,549 |  |  | $ | 16,920 |  |  | $ | 66,277 |  |  | $ | 47,505 |  |  |
|  | Nine months ended September 30,
Supplemental information on the measurement of operating lease liabilities |  | 2025 |  | 2024 |  |
Operating cash flows for operating leases |  | $ | 48,346 |  |  | $ | 41,740 |  |  |
Leased assets obtained in exchange for new operating lease liabilities |  | 48,544 |  |  | 210,551 |  |  |
|  |  | As of September 30, |  | As of December 31,
Lease term and discount rate |  |  | 2025 |  | 2024
Weighted-average remaining lease terms (in years) |  |  | 13.0 |  | 14.1
Weighted-average discount rate |  |  | 5.8% |  | 5.8%

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