Fortress Investment Group posted a bigger third-quarter loss as revenue and assets under management dropped.

The alternative investments giant lost $58.6 million during the quarter, up from $57.4 million. Pretax distributable earnings were $57 million, better than analysts’ expectation.

The firm’s assets under management fell by 6.7% to $32 billion from the year-earlier period. Investors pulled $766 million from Fortress in the quarter, most of that from its hedge funds.

With fewer assets come lower management fees, which fell 31% to $106.9 million. Revenue fell 22% to $143.7 million, but incentive income from affiliates soared by more than 1,000% to $7.6 million.

The firm’s expenses were $397.6 million, down 3% from the third quarter of 2008.