Key Insights from Preqin & Australian Investment Council Yearbook 2024

According to Preqin & Australian Investment Council’s 2024 yearbook Australia's private markets continue to exhibit resilience, thriving amidst evolving global economic landscapes. The following points offer insights for wholesale investors seeking to understand and leverage private market investment opportunities.

Outperformance of Australia-focused funds

In the past decade, Australia-focused private capital funds have displayed a highly commendable performance. Vintage funds (2013 to 2020) showcased a median net IRR of 14.5%, a clear hallmark of their successful investment strategies. This level of return was ahead of North America (14.0%), Asia (14.0%), Europe (13.8%), and Rest of the World (8.8%). At iPartners, our alternative asset offerings carefully scrutinise such aspects, ensuring our clients have access to robust, high-performing funds.

Accumulation of dry powder driving AUM growth

Australian private capital has seen a significant surge in assets under management (AUM). As of June 2023, it was $139.0bn, more than doubled just within a span of slightly over four years. This growth is primarily driven by an accumulation of dry powder, signifying untapped potential for capital deployment.

Emergence of significant opportunities across alternative sectors

Alternative sectors such as Australian housing (including student and seniors), logistics catalysed by larger e-commerce growth, and critical data infrastructure, are offering enticing possibilities for capital allocation. Furthermore, Australia's net-zero goals and government support have the potency of attracting significant capital.

Resilience amidst slower global growth

While Preqin forecasts a slowdown in the global growth of alternatives AUM (from 12.3% between end-2022 to 2028 to 8.4%). However, as a relatively mature private capital market within APAC, Australia has historically offered more stable returns compared to the wider APAC market. For our investors, this stability translates into more predictable and dependable investment outcomes.

Stay tuned to iPartners for clear, concise, and expert insights into navigating the Australian private capital marketplace. We aim to equip our investors with the requisite knowledge and opportunities to make informed alternative investment decisions.

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