Credit secondaries carve out “niche” as GP-led deals rise

Credit secondaries are “carving out a distinct niche in the market”, with general partner (GP)-led deals now outpacing activity in venture, growth and infrastructure.

The rapid expansion of the $3tn (£2.3tn) private credit market has fuelled a “fast-growing” secondaries segment, according to law firm Dechert.

While credit secondaries remain smaller than other asset classes by transaction volume, they are expanding quickly. Despite lagging venture and growth in limited partner (LP)-led deals, they have already moved ahead of venture, growth and infrastructure on the GP-led side.

Alongside this, with market volatility set to persist through 2025, appetite for private credit secondaries is expected to remain strong as investors look to manage portfolio risk.

“This momentum suggests that credit secondaries are carving out a distinct niche in the market,” Dechert noted.

This comes as secondaries firm Coller Capital recently raised $6.8bn for its second private credit secondaries vehicle. Meanwhile, Ares Management is currently in market with its debut private credit secondaries fund.

Read more: Private credit secondaries on the rise

Pricing in the segment averaged 92 per cent of net asset value in the first half of 2025, up from 91 per cent at the end of 2024.

Dechert added that credit secondaries allow investors to rebalance portfolios through full or partial sales of fund interests instead of waiting for distributions. The strategy can also broaden a fund’s LP base, as the most uncertain stage of the loan lifecycle has typically passed.

“Although private credit secondaries remain small in value compared with more established asset classes, they are expected to continue growing and to support the shift towards increasingly active portfolio management,” the firm said.