Bain: Private market assets will be worth $65tn by 2032

Private market assets are set to grow at more than twice the rate of public assets, to reach up to $65tn (£49.75tn) by 2032.

According to new research from Bain & Company, private assets are set to grow by a nine to 10 per cent compound annual growth rate (CAGR).

Meanwhile, private alternative credit is expected to expand at a 10 to 12 per cent CAGR. Infrastructure growth will likely maintain a 13 to 15 per cent CAGR pace over the next decade.

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Fee revenue for private market investments should double to $2bn by 2032, Bain has estimated.

“Wealth and asset managers are now favouring private markets because the business models that have dominated asset management for years have nearly run their course,” said Markus Habbel, global head of Bain’s wealth and asset management practice,

“Private assets constitute a much larger market than public assets and offer potentially higher yields, diversification, and in cases such as real estate—a hedge against inflation.”

Bain has predicted that institutional investors will increase their allocations to alternative assets by a 10 per cent CAGR from 2022 to 2032, causing AUM to reach at least $60tn.

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Retail investors are also expected to increase their contributions, causing the retail AUM share of private markets to rise from 16 per cent in 2022 to 22 per cent in 2032.

“Individuals are drawn to the alternative asset market by the prospect of diversification and higher returns and are therefore willing to tolerate lower liquidity,” said Habbel.

“In response to this demand, leading companies have launched innovative offerings such as intermittent liquidity products for retail investors.”

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