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Laxman Pai, Opalesque Asia:

Global private debt fundraising hit $172bn by the end of Q3 2022 - with 137 private debt funds closed - representing 80% of the capital raised during the whole of 2021, said a study.

"Investors are continuing to deploy capital at a similar pace to 2021, which itself was a record-breaking year for private debt fundraising," said Preqin Global Report 2023: Private Debt.

According to the report, private debt has been one of the fastest-growing asset classes in recent years. Preqin data shows total assets under management (AUM) reached $1.2tn in 2021 and that AUM within the asset class grew at a compound annual growth rate CAGR of 15.7% from 2015 to 2021. This was the third-highest AUM growth rate among alternative asset classes, after venture capital and infrastructure.

"AUM across the asset class is expected to increase by a CAGR of 10.8% between December 2021 and December 2027, and is forecasted to reach an all-time high of $2.3tn in 2027," the report highlighted.

Looking at performance by region, smaller Asian funds are shown to be hidden gems, emerging as the top-performing size quartile across the regions, with a lifetime net internal rate of return (IRR) of 11.7%. Meanwhile, North America-focused funds outperformed their Europe-focused peers across all size quartiles, with smaller fund groups outperforming the larger ones.

The smallest North America-focused funds posted a median net IRR of 10.8%, with ......................

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