Market commentary

2025 Market Outlook

While a potential resurgence in inflation could create headwinds, we expect that favorable conditions for U.S. businesses will help position our Credit, Real Estate and GP Strategic Capital platforms for continued growth.

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Credit

Against the backdrop of unpredictable market conditions, private credit portfolios remained resilient and performed well throughout 2024. As we look to 2025, the trend of shifting economic narratives appears likely to continue against a backdrop of secular trends that may lead to new and expanding opportunities in private markets. In this piece, we will provide our outlook for 2025 while examining three key themes within private credit that may help orient investors as they seek to navigate the evolving marketplace.

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GP Strategic Capital

2024 may be remembered as a year where anticipation greatly exceeded action in private markets. While that may have been true for deal and especially exit activity, beneath the surface we observed accelerating change as both GPs and LPs prepared to compete in the next era of private capital expansion. In our key themes for 2025,  we highlight the industry’s entry into a period of “survival of the fittest” – a world in which the gap will widen between top and bottom performers and the ability to balance overall fund performance with investor liquidity may well determine whether a manager can raise its next fund.

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Real Estate

Investors appear to be entering a new era of optimism for commercial real estate following a challenging few years of declining valuations, persistent inflation, and higher interest rates and credit spreads paired with lower credit availability. For the limited number of real estate managers and investors who are fortunate enough to have access to dry powder, they will be able to take advantage of what many believe to be a once-in-a-generation buying opportunity.

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Unless otherwise indicated, the information referenced herein is as of December 31, 2024.

Past performance is not a guarantee of future results. 

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