Private Equity Perspectives: Unlisted Asset Growth

As the global financial landscape continues to evolve, institutional investors are turning to unlisted assets in unprecedented ways. Private markets, now a $24 trillion asset class, offer an array of opportunities beyond traditional equities and bonds. In this article, we explore the drivers of this growth, delve into key asset classes, assess market dynamics, and offer practical insights for navigating the unlisted asset frontier.

Overview of Unlisted Asset Growth

Over the past decade, allocations to private equity, infrastructure, private debt, and real estate have surged. Investors are seeking stable, long-term performance and portfolio resilience in a world of public market volatility. According to IFM Investors, institutional allocations to private equity are projected to rise to 15.4% of total portfolios within five years, while infrastructure equity and debt allocations are expected to reach 7.34% and 50%, respectively.

Alongside higher return expectations, unlisted assets provide a valuable illiquidity premium for investors willing to commit capital over the long term. Recent data shows that private equity returns have averaged over 10%, with exit values up by more than 69% year-over-year in the first half of 2025. Meanwhile, environmental infrastructure funds alone now represent $1.8 trillion, driven by energy transition priorities around the globe.

Key Asset Classes in Unlisted Investments

Private Equity remains a cornerstone of unlisted portfolios. Defined as investments in non-listed companies via specialized funds, private equity attracts pension funds, foundations, family offices, and increasingly high-net-worth individuals. With 96% of surveyed institutional investors allocating to this asset class, deal activity continues to flourish:

- Add-on transactions accounted for 75.9% of buyout activity in Q2 2025.
- IPOs rose by 44.3% compared to 2024.
- Secondary market deal value grew by 42% in H1 2025.

A backlog of over 30,000 portfolio companies, including 12,552 in the exit pipeline, underscores the depth of opportunity and the need for selective, high-quality exits in the years ahead.

Infrastructure investments blend essential physical assets—energy, transport, social, and environmental projects—with attractive returns and risk management. Institutional investors cite the illiquidity premium and income generation as primary motivations. By 2029, 54% plan to invest in infrastructure equity and 50% in infrastructure debt. Strategies break down as follows:

• Core/Core-Plus targeting 5–12% returns
• Value-Add aiming for 13–16% returns
• Opportunistic seeking 16%+ returns

More than 80% of investors now prioritize social and environmental infrastructure, with a strong focus on renewables, green buildings, and energy transition projects.

Private Debt and Real Estate round out the unlisted spectrum. Private debt allocations are expected to hover around 6.8%, offering financing solutions for companies and infrastructure initiatives. Real estate remains a top pick for 96% of investors, delivering income stability and diversified risk across sectors.

Investor Motivations and Trends

Institutional investors cite several core drivers behind the shift to unlisted assets:

• Illiquidity premium: Enhanced returns in exchange for capital lock-up.
• Portfolio diversification: Lower correlation with public markets.
• Resilience and income generation: Steady cash flows from infrastructure and real estate.
• Democratization of private assets: Regulatory changes enable broader access.

Partnerships between private capital and governments are expected to unlock new infrastructure projects, with over 55% of investors anticipating collaborative opportunities in the coming years.

Market Dynamics and Challenges

Despite the promising outlook, several challenges persist. The growing backlog of PE-backed companies has extended holding periods, while selective exit strategies are essential to maintain performance benchmarks. Regulatory reforms such as ELTIF 2.0 in Europe aim to democratize access, but also introduce new compliance and reporting requirements.

Fundraising remains robust—PE firms raised $340 billion in H1 2025—but competition for high-quality deals is intensifying. Institutional investors must balance yield expectations with thorough due diligence and long-term partnership alignment.

Regional Perspectives and Institutional Case Studies

Different regions exhibit unique trends. In the United States, energy transition and environmental infrastructure are hotspots, with 82% of investors prioritizing clean energy projects. Europe’s regulatory push broadens retail participation through enhanced private asset frameworks.

OMERS, Canada's pension giant, exemplifies a diversified approach: 69% of its portfolio in unlisted markets, including 19% in private equity, 22% in infrastructure, 15% in real estate, and 13% in private credit. This mix underscores the value of balanced, cross-asset strategies for long-term stability and growth.

Conclusion: Embracing the Unlisted Future

As global private markets continue their remarkable expansion, investors equipped with strategic insight and practical tools will thrive. Whether tapping into private equity’s robust returns, infrastructure’s essential assets, private debt’s financing roles, or real estate’s income stability, the unlisted universe offers compelling pathways to meet modern portfolio goals.

By staying informed on trends, leveraging partnerships, and adopting a disciplined approach, both institutional and emerging investors can navigate the complexities of unlisted asset growth. In doing so, they will not only capture the illiquidity premium on offer but also contribute to the real economy through sustainable infrastructure and innovative ventures.