Key Takeaways
- • Eighty-one percent of alternative fund managers expect higher fundraising levels over the next 18 months compared to the prior period, signaling broad industry optimism despite challenging macroeconomic conditions and geopolitical headwinds.
- • Private equity, infrastructure, and real estate funds are positioned to capture the most capital inflows, reflecting investor appetite for tangible and yield-generating assets.
- • Nearly all respondents (98%) express confidence in launching new funds within 18 months, with 52% extremely confident and 46% moderately confident, indicating strong institutional conviction about market recovery.
- • Ninety-one percent of alternative fund managers forecast higher alternative asset fund offerings in 2023 versus 2022, with 28% anticipating substantial increases and 63% expecting modest growth, reversing 2022's historically weak fundraising environment.
- • The recovery in fund launches and capital deployment reflects a turning point after 2022 marked the lowest levels of fund formation and capital raised in many years, according to Ocorian, a leading provider of entity administration and fiduciary services for alternative asset managers.
Summary
Alternative fund managers are entering a markedly optimistic phase following 2022's historically weak fundraising environment. According to Ocorian, a specialist in entity administration and fiduciary services for alternative asset funds, 81% of fund managers expect higher fundraising levels over the next 18 months compared to the prior 18-month period. This represents a significant shift in manager sentiment, with 69% anticipating slightly elevated fundraising and 12% forecasting substantially higher capital inflows. Only 1% expect lower fundraising activity.
Paul Spendiff, Head of Business Development at Ocorian Fund Services, characterized the outlook as encouraging despite persistent economic challenges. "2022 was a tough year for the fund management industry, with the number of funds launched and amount of capital raised hitting the lowest levels we've seen for many years," Spendiff noted, emphasizing that the current recovery reflects manager resilience even amid geopolitical uncertainties affecting certain markets.
Confidence in fund launches underscores this optimism. Nearly all respondents (98%) believe they will successfully launch new funds within the next 18 months, with 52% expressing extreme confidence and 46% moderate confidence. This widespread conviction suggests managers are positioned to capitalize on anticipated capital availability and investor appetite for alternative assets. Ninety-one percent of alternative fund managers expect higher alternative asset fund offerings throughout 2023 relative to 2022, with 28% forecasting substantial increases and 63% projecting modest growth.
Private equity, infrastructure, and real estate strategies are expected to capture the largest share of capital inflows, reflecting institutional investor demand for income-generating and tangible assets in a higher interest rate environment. The sector recovery represents a notable inflection point from 2022's depressed fundraising activity, positioning alternative asset managers to meet what appears to be a sustained period of capital deployment and fund formation.
Paul Spendiff, Head of Business Development at Ocorian Fund Services, characterized the outlook as encouraging despite persistent economic challenges. "2022 was a tough year for the fund management industry, with the number of funds launched and amount of capital raised hitting the lowest levels we've seen for many years," Spendiff noted, emphasizing that the current recovery reflects manager resilience even amid geopolitical uncertainties affecting certain markets.
Confidence in fund launches underscores this optimism. Nearly all respondents (98%) believe they will successfully launch new funds within the next 18 months, with 52% expressing extreme confidence and 46% moderate confidence. This widespread conviction suggests managers are positioned to capitalize on anticipated capital availability and investor appetite for alternative assets. Ninety-one percent of alternative fund managers expect higher alternative asset fund offerings throughout 2023 relative to 2022, with 28% forecasting substantial increases and 63% projecting modest growth.
Private equity, infrastructure, and real estate strategies are expected to capture the largest share of capital inflows, reflecting institutional investor demand for income-generating and tangible assets in a higher interest rate environment. The sector recovery represents a notable inflection point from 2022's depressed fundraising activity, positioning alternative asset managers to meet what appears to be a sustained period of capital deployment and fund formation.
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