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To a lesser extent, management fees are based upon the net asset value of vehicles in our Liquid Strategies, measured at fair value.
−Removed: At March 31, 2023, our Liquid Strategies make up 4% of our $28 billion FEEUM.
+Added: At June 30, 2023, our Liquid Strategies make up 4% of our $29 billion FEEUM.
Accordingly, most of our management fee income will not be directly affected by changes in investment fair values.
−Removed: Incentive Fees and Carried Interest —Incentive fees and carried interest, net of management allocations, are earned based upon the financial performance of a vehicle above a specified return threshold, which is largely driven by appreciation in value of underlying investments.
+Added: Incentive Fees and Carried Interest —Incentive fees and carried interest, net of management allocations, are earned based upon the financial performance of a vehicle above a specified return threshold, which is largely driven by
+Added: appreciation in value of underlying investments.
Carried interest is subject to reversal until such time it is realized, which generally occurs upon disposition of all underlying investments of an investment vehicle, or in part with each disposition.
3 unchanged sentences
Foreign Currency Risk
−Removed: As of March 31, 2023, we have limited direct foreign currency exposure from our foreign operations and foreign currency denominated investments warehoused on the balance sheet for future sponsored vehicles.
+Added: As of June 30, 2023, we have limited direct foreign currency exposure from our foreign operations and foreign currency denominated investments warehoused on the balance sheet for future sponsored vehicles.
Changes in foreign currency rates can adversely affect earnings and the value of our foreign currency denominated investments, including investments in our foreign subsidiaries.
4 unchanged sentences
subsidiaries.
−Removed: At March 31, 2023 , our foreign currency exposure is limited to only one AUD equity investment (A$35 million).
+Added: Our foreign currency exposure is limited to only one AUD equity investment (cost of investment at AUD 35 million).
Operating segment —For the substantial majority of subsidiaries in Canada that operate hyperscale data centers, the U.S.
dollar is largely used as the transactional currency, in which case, there is generally very limited foreign currency exposure.
−Removed: Foreign subsidiaries that operate six colocation data centers in the U.K.
−Removed: and France do not transact in U.S.
−Removed: dollars but make up only a small percentage of the overall Operating segment, which in turn is substantially owned by third party investors.
−Removed: Accordingly, our exposure to foreign currency risk from the operations of foreign subsidiaries in the Operating segment is limited as of March 31, 2023.
+Added: Foreign subsidiaries that operate one colocation data center in the U.K.
+Added: and five in France do not transact in U.S.
+Added: dollars, but they make up only a small percentage of the overall Operating segment, which in turn is substantially owned by third party investors.
+Added: Additionally, the French portfolio is currently held for disposition.
+Added: Overall, our exposure to foreign currency risk from the operations of foreign subsidiaries in the Operating segment is limited.
Interest Rate Risk
Instruments bearing variable interest rates include debt obligations, which are subject to interest rate fluctuations that will affect future cash flows, specifically interest expense.
−Removed: Corporate debt —Our corporate debt exposure to variable interest rates is limited to our VFN revolver, which had no outstanding amounts as of March 31, 2023.
−Removed: Investment-level debt —Investment level financing, which totals $4.9 billion, consists primarily of fixed rate securitized notes issued by subsidiaries in the Operating segment, Vantage SDC and DataBank.
−Removed: Of this amount, $0.4 billion or 7% is composed of variable rate debt at March 31, 2023.
−Removed: Investment level variable rate debt is indexed to either 1-month LIBOR or Term SOFR.
−Removed: As subsidiaries in the Operating segment are substantially owned by third party investors, the resulting
−Removed: increase in interest expense from higher interest rates will be attributed predominantly to noncontrolling interests, with a minimal share of that effect attributed to DBRG.
−Removed: Based upon the outstanding principal on investment level variable rate debt at March 31, 2023, a hypothetical 100 basis point increase in interest rates would increase annualized interest expense by $3.6 million on a consolidated basis or $0.4 million after attribution to noncontrolling interests.
+Added: Corporate debt —Our corporate debt exposure to variable interest rates is limited to our VFN revolver, which had no outstanding amounts as of June 30, 2023.
+Added: Investment-level debt —Investment level financing, which totals $5.1 billion, consists primarily of fixed rate securitized notes and loans issued by subsidiaries in the Operating segment, Vantage SDC and DataBank.
+Added: Of this amount, $0.5 billion or 10% is composed of variable rate debt at June 30, 2023.
+Added: Investment level variable rate debt is indexed primarily to Term SOFR.
+Added: As subsidiaries in the Operating segment are substantially owned by third party investors, the resulting increase in interest expense from higher interest rates will be attributed predominantly to noncontrolling interests, with a minimal share of that effect attributed to DBRG.
+Added: Based upon the outstanding principal on investment level variable rate debt at June 30, 2023, a hypothetical 100 basis point increase in interest rates would increase annualized interest expense by $5.2 million on a consolidated basis or $0.6 million after attribution to noncontrolling interests.
Equity Price Risk
−Removed: At March 31, 2023, we had $166 million of long positions and $46 million of short positions in marketable equity securities, held predominantly by our consolidated sponsored liquid funds.
+Added: At June 30, 2023, we had $97 million of long positions and $46 million of short positions in marketable equity securities, held predominantly by our consolidated sponsored liquid funds.
Realized and unrealized gains and losses from marketable equity securities are recorded in other gain (loss) on the consolidated statement of operations.
10 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.