Global alternative assets are projected to increase 9.7% annually from 2023 to 2029 to hit US$29.2 trillion, while global private equity market will grow more than double driven by demands from private wealth investors, according to UK data provider Preqin.
Preqin’s September 18 report says that global alternative industry reached $16.8 trillion at the end of 2023. It estimates the market will exceed $30 trillion by 2030.
The forecasted 9.7% growth represents a slowdown from 10.5% between 2017 and 2023 due to softer private equity and venture capital market expectations, according to the report.
According to Cameron Joyce, global head of research insights at Preqin, global alternatives markets continue to evolve rapidly, especially as access to individual investors opens up and growth in private wealth channels continue to gather pace.
“While policy rates are expected to decline, macroeconomic conditions are likely to remain more challenging than during the pre-pandemic era, and our forecast of slower industry growth reflects that. Investors are navigating evolving geopolitical risks as we move towards a multipolar world order – which presents a new set of investment opportunities and risks,” she says in the report.
Preqin forecasts that private equity market will grow from $5.8 trillion in 2023 to $12 trillion in 2029, representing an annualised growth rate of 12.8%.
Private equities will account for approximately 6% of all global public and private equity assets by the end of 2024. The share will increase over time due to a combination of factors including private companies staying private for longer, and lackluster initial public offering markets, Preqin predicts.
It expects private equity fundraising will remain challenging, but that growth will pick up from 2027, driven by increasing interest from private wealth investors who currently have a relatively low exposure to private equity.
