As we move through 2025, Brookfield Asset Management (NYSE: BAM, TSX: BAM) continues to solidify its position as a leading pure-play global alternative asset manager, focusing on real assets and essential service businesses that form the backbone of the global economy. For investors seeking stable, long-term growth and a commitment to sustainability, BAM presents a compelling case.

A Focus on Foundational Investment Philosophy

Brookfield’s investment philosophy is deeply rooted in its 100-plus-year heritage as an owner and operator. The firm focuses on high-quality assets and essential service businesses that generate stable, inflation-linked, and growing revenue streams with high cash margins. Their approach is disciplined and value-based, aiming to identify attractive investment opportunities and enhance value through operational improvements. BAM seeks to deliver strong risk-adjusted returns to clients and shareholders by proactively managing and conservatively financing these assets.

Riding the Wave of Global Megatrends

Brookfield Asset Management is strategically positioned to capitalize on significant long-term macro tailwinds reshaping the global economy. These include:

• Decarbonization and Energy Transition: BAM believes decarbonization presents one of the greatest commercial opportunities of our time. They are committed to achieving net-zero greenhouse gas (GHG) emissions by 2050 or sooner across their Operationally Managed investments, which represent assets where they can broadly influence decarbonization outcomes (63% of AUM as of December 31, 2024). Key initiatives include providing a Net Zero Playbook to portfolio companies and developing specific decarbonization plans for assets. In 2024, BAM launched the Catalytic Transition Fund (CTF) in partnership with ALTÉRRA, a multi-billion-dollar fund dedicated to decarbonization initiatives in emerging and developing markets. The firm is expanding its Transition Strategy franchise, with three funds expected to raise $40 billion of equity capital targeting quantifiable decarbonization impacts.

• Digitalization and AI Infrastructure: The rapid growth of artificial intelligence is driving an unprecedented demand for data centers, fiber, telecom towers, and additional energy resources. In February 2025, BAM announced a €20 billion infrastructure investment program in France to support AI infrastructure, with significant portions allocated to data centers (Data4) and associated infrastructure like data transfer, chip storage, and energy generation, projected for delivery by 2030.

• Deglobalization: This megatrend, along with decarbonization and digitalization, provides significant growth opportunities for Brookfield’s asset classes.

Strong Financial Performance and Ambitious Growth Targets

Brookfield Asset Management demonstrates robust financial health and has set ambitious targets for future growth.

• Assets Under Management (AUM) & Fee-Bearing Capital (FBC): As of March 31, 2025, BAM managed over $1 trillion in AUM and had $549 billion in Fee-Bearing Capital. This FBC grew to $563 billion by Q2 2025. The company aims to double its Fee-Bearing Capital to $1 trillion over the next five years.

• Earnings Growth: In Q1 2025, fee-related earnings (FRE) reached $698 million, and distributable earnings (DE) hit $654 million. The company achieved 26% Q1-25 FRE growth year-over-year. BAM is targeting to more than double its Distributable Earnings to $5 billion by 2028.

• Carried Interest: A significant upside for BAM comes from its carried interest, which is the company’s share of profits on successful funds. While Brookfield Corporation (BN) retains all carried interest from mature funds and 33.3% from new sponsored funds, BAM expects its own carried interest realizations to begin impacting earnings in 2029, with projected ~$2 billion in realizations that year, accelerating to ~$7 billion by 2034.

• Dividend Policy: BAM aims to pay out approximately 90% of its Distributable Earnings to shareholders quarterly and reinvest the balance back into the business. The company just increased its quarterly dividend by 15% to $1.75 per share annually and expects to maintain a 15%+ annual dividend growth rate through 2030.

Diversified Investment Strategies

BAM offers a highly diversified suite of alternative investment strategies across five principal categories:

• Renewable Power and Transition: With $58 billion in Fee-Bearing Capital as of March 31, 2025, BAM is a leading investor in this space. They leverage extensive experience and operating capabilities in major clean energy technologies. The firm is actively fundraising for the second vintage of its global transition fund.

• Infrastructure: Managing $96 billion in Fee-Bearing Capital as of March 31, 2025, Brookfield’s infrastructure strategy is well-positioned for significant investment requirements globally. They expect to launch their next flagship infrastructure fund in late 2025 or early 2026.

• Real Estate: The real estate strategy held $100 billion in Fee-Bearing Capital as of March 31, 2025. Brookfield Real Estate achieved strong GRESB scores in 2024, reflecting its commitment to sustainability. The firm’s fifth real estate flagship fund is nearing completion of its fundraising, ideally timed for market recovery.

• Private Equity: With $43 billion in Fee-Bearing Capital as of March 31, 2025, Brookfield’s private equity strategy focuses on high-quality businesses providing essential products and services, partnering with management teams for operational improvements. They expect to launch their next flagship private equity fund in 2025.

• Credit: This is a rapidly expanding area, with $252 billion in Fee-Bearing Capital as of March 31, 2025. BAM established itself as a leader in alternative credit through its partnership with Oaktree (approximately 74% owned as of Q1 2025). Recent acquisitions include Castlelake (aviation & asset-based credit) and SVB Capital (rebranded Pinegrove Ventures). They are repositioning their liquid credit portfolio towards private credit and long-term private funds, which is expected to generate incremental fees. The firm focuses on real asset-backed finance and opportunistic credit, avoiding more commoditized areas of sponsored direct lending.

Strategic Corporate Developments in 2025

Several key strategic initiatives are underway to enhance BAM’s market position and investor appeal:

• 2025 Corporate Arrangement: On February 4, 2025, BAM completed a corporate arrangement with Brookfield Corporation (BN), resulting in BAM owning 100% of the asset management business, while BN holds approximately 73% of BAM’s Class A shares. This restructuring is designed to simplify the corporate structure and facilitate broader equity index inclusion, particularly in the U.S..

• Head Office Relocation: As of October 31, 2024, BAM changed its head office to New York, NY, aligning with its largest share of revenues, AUM, employees, and institutional shareholders being U.S.-based. This move aims to position BAM for eligibility in major U.S. equity indices.

• Enhanced Liquidity: In April 2025, BAM completed its inaugural debt offering, raising $750 million of 10-year bonds at a fixed rate of 5.795%. This adds to the firm’s robust liquidity position, which was $1.5 billion at the end of Q2 2025.

• Private Wealth Channel Expansion: Recognizing a structural reorientation in capital raising towards individual investors, BAM is significantly investing in its private wealth and retirement platform, Brookfield Wealth Solutions (BWS). BWS is on track to raise over $30 billion of capital in 2025 from private wealth and insurance annuity channels. The recent agreement for Brookfield (BN, BAM’s largest shareholder) to acquire Just Group, a UK retirement services provider, highlights the potential for BAM to manage a significant portion of its portfolio under an existing investment management agreement with BWS, adding high-quality, stable fee-bearing capital without taking on insurance liabilities.

Outlook: A Long Way to Run

Brookfield Asset Management is optimistic about its future, expecting to exceed previous fundraising efforts and launch new flagship private equity and infrastructure funds in 2025 and early 2026. The firm’s strategy is to continue scaling into areas where the megatrends intersect, particularly AI infrastructure, energy transition, and critical real assets.

Key Takeways:

• BAM is strategically focused on multi-decade global megatrends of decarbonization, deglobalization, and digitalization, anticipating trillions in required investment. This includes a net-zero ambition by 2050 or sooner across over 63% of its AUM and a €20 billion AI infrastructure investment program in France by 2030
• BAM managed over $1 trillion in AUM and $563 billion in Fee-Bearing Capital (FBC) as of Q2 2025. The company aims to double FBC to $1 trillion and Distributable Earnings (DE) to $5 billion by 2028, with an expected 15%+ annual dividend growth rate through 2030
• Carried interest is a significant, yet often “hidden,” asset for BAM, with realizations projected to begin substantially impacting earnings around 2029 (~$2 billion) and accelerating to ~$7 billion by 2034
• The 2025 Corporate Arrangement has streamlined BAM to own 100% of the asset management business, enhancing its eligibility for broader U.S. equity index inclusion (e.g., FTSE Russell 1000 in July 2025). BAM is also rapidly expanding its credit platform ($251.6 billion FBC in Q1 2025) and investing significantly in its private wealth solutions, targeting over $30 billion in capital raised in 2025

With strong momentum and clear strategic objectives, Brookfield Asset Management is well-positioned for continued growth and value creation for its investors throughout 2025 and beyond.