Key Takeaways
- • NEPC's Q3 2026 private markets report finds liquidity improving in buyouts, with U.S. buyout exit value reaching $398.8 billion through the third quarter, already exceeding full-year exit value in 2022, 2023 and 2024, though mega-exits account for 73.3% of that total.
- • Capital concentration is intensifying: buyout funds of $1 billion or more account for approximately 83% of capital raised through the third quarter, and 26 venture funds of $1 billion or more raised about 68% of North American venture capital raised.
- • AI dominates venture deal value, representing $426.7 billion, or 82.7%, of U.S. venture deal value through the third quarter, while AI represents roughly 45% of deal count, per PitchBook data cited by NEPC.
- • Private credit redemption pressure persists, with BCRED redemption requests at 10%, HPS HLEND at 11.5% and Cliffwater CCLFX at 16% in the third quarter, all above the 5% quarterly gates on most funds.
- • Real estate valuations are at risk of further write-downs, as appraisers have signaled possible markdowns following recent increases in 10-year Treasury yields, while the ODCE posted a preliminary 1.71% gross return in Q3.
Summary
NEPC's quarterly private markets report for Q3 2026 characterizes the asset class as one in which liquidity, concentration and AI exposure are the defining themes. Citing PitchBook, NEPC notes that private equity exit value rose about 50% in the third quarter from the prior quarter, though roughly a third of sponsor-owned companies have been held for more than five years. Continuation vehicles, secondary sales and other structured transactions have served as key liquidity levers for general partners.
In buyouts, U.S. buyout deal activity totaled $357.5 billion across 1,151 transactions through the first three quarters, with 299 platform buyouts completed in the third quarter, down from 406 in the second quarter. Median U.S. buyout entry valuations rose to 12.0x EV/EBITDA from 11.5x in 2025, still below the 13.0x five-year average and the 14.3x peak in 2021. Strategic buyers drove liquidity, with corporate acquisitions generating $86.6 billion in the third quarter while public listings contributed $19.0 billion. Fundraising remains subdued, with U.S. buyout managers raising $222.0 billion across 275 funds, and average fund close timelines extending to 16.2 months.
Venture capital shows renewed momentum but remains concentrated. North American venture deal value reached $515.8 billion through the third quarter, above the $319.7 billion invested in all of 2025, though third-quarter activity moderated to $98.4 billion. NEPC highlights the AI concentration, and cites the announced acquisitions of Hugging Face by NVIDIA for approximately $12.9 billion and World Labs by AMD for approximately $8.2 billion, along with SpaceX's agreement to acquire Cursor for $60 billion in stock.
In private credit, NEPC reports that redemption requests continue to exceed the 5% quarterly gates on most BDCs, while secondary volume reached $20 billion in the first half of 2026. Direct lending spreads have compressed, and the software sector's share of direct lending deals fell to 12% from 16% a year earlier. Sponsor-backed direct lending volume rose 31% quarter over quarter to $27.4 billion, though year-to-date activity remains 23% below 2025.
Real estate valuations have stabilized, with apartment and industrial transactions near 5% cap rates, though NEPC warns of possible further write-downs. Industrial leasing reached 202.6 million square feet in the third quarter. In infrastructure, KKR, Partners Group and ECP accounted for nearly 65% of capital raised across 17 final closes, and Macquarie's sale of Aligned Data Centers to a consortium of AIP, MGX and BlackRock's GIP was reported at an enterprise value of roughly $40 billion.
In buyouts, U.S. buyout deal activity totaled $357.5 billion across 1,151 transactions through the first three quarters, with 299 platform buyouts completed in the third quarter, down from 406 in the second quarter. Median U.S. buyout entry valuations rose to 12.0x EV/EBITDA from 11.5x in 2025, still below the 13.0x five-year average and the 14.3x peak in 2021. Strategic buyers drove liquidity, with corporate acquisitions generating $86.6 billion in the third quarter while public listings contributed $19.0 billion. Fundraising remains subdued, with U.S. buyout managers raising $222.0 billion across 275 funds, and average fund close timelines extending to 16.2 months.
Venture capital shows renewed momentum but remains concentrated. North American venture deal value reached $515.8 billion through the third quarter, above the $319.7 billion invested in all of 2025, though third-quarter activity moderated to $98.4 billion. NEPC highlights the AI concentration, and cites the announced acquisitions of Hugging Face by NVIDIA for approximately $12.9 billion and World Labs by AMD for approximately $8.2 billion, along with SpaceX's agreement to acquire Cursor for $60 billion in stock.
In private credit, NEPC reports that redemption requests continue to exceed the 5% quarterly gates on most BDCs, while secondary volume reached $20 billion in the first half of 2026. Direct lending spreads have compressed, and the software sector's share of direct lending deals fell to 12% from 16% a year earlier. Sponsor-backed direct lending volume rose 31% quarter over quarter to $27.4 billion, though year-to-date activity remains 23% below 2025.
Real estate valuations have stabilized, with apartment and industrial transactions near 5% cap rates, though NEPC warns of possible further write-downs. Industrial leasing reached 202.6 million square feet in the third quarter. In infrastructure, KKR, Partners Group and ECP accounted for nearly 65% of capital raised across 17 final closes, and Macquarie's sale of Aligned Data Centers to a consortium of AIP, MGX and BlackRock's GIP was reported at an enterprise value of roughly $40 billion.
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