This trend has driven institutional investors to seek liquidity solutions for funding further growth opportunities and managing portfolio risk. Notably, secondaries currently account for less than five percent of the overall private equity market, suggesting significant opportunities ahead.
- Growing Opportunity in Private Credit
As banks increasingly withdraw from lending to private companies due to regulatory restrictions, private lenders may encounter substantial investment opportunities by providing the flexible capital solutions that many borrowers require for business growth.
Historically, private credit lending has offered a return premium compared to many public fixed income investments, along with strong rates of capital preservation and lower volatility.
- Significant Increase in Demand for Infrastructure Assets
Northleaf predicts ongoing investment in essential infrastructure, such as bridges, roads, power generation, and telecommunications, driven by the need to maintain and repair aging infrastructure.
The substantial capital required for these investments cannot be solely met by public funding. Private infrastructure presents an evolving investment option, including new opportunities in sustainability and technology, which are expected to become one of the fastest-growing segments in private markets.