Preqin, a part of BlackRock, predicts that private markets will expand to more than $34rtn in AUM by 2031, with the potential for further growth as the private credit asset class expands into broader asset-backed strategies.
Private markets fundraising is positioned for renewed growth through 2031, with expected improving liquidity, evolving investor allocations and expanding investment opportunities supporting long-term demand for private market investments, according to the specialist firm’s “Private Markets in 2031”, its flagship annual forecast of the trends shaping private markets over the next five years.
The report examines fundraising, performance, and assets under management (AUM) across private equity, private credit, venture capital, and infrastructure.
Key themes include that private equity markets are expanding “beyond the reset”. It forecast that global private equity AUM will reach $11.6trn by 2031, supported by improving investment performance and capital return. Growth equity and secondaries are forecast to expand faster than traditional buyout strategies, while manager selection and disciplined underwriting remain critical amid ongoing dispersion in outcomes.
Second, Preqin believes that private credit is entering a “more disciplined phase”. Private credit AUM is forecast to surpass $5trn by 2031, with a broader opportunity emerging as private credit expands beyond traditional corporate lending into asset-based finance and other strategies not fully captured by conventional fund-based estimates.
Evergreen structures are expected to be the fastest-growing segment of the asset class. As returns dispersion widens, credit quality, downside protection and risk management are expected to become more important.
Third, AI is reshaping venture capital. AI is expected to remain a significant tailwind for venture capital by lowering barriers to company formation and creating opportunities across the application layer. Preqin’s base case forecasts venture capital AUM of $3.79trn by 2031, supported by productivity gains, while alternative scenarios assess how faster or slower AI adoption could affect valuations, fundraising and exits.
Finally, “structural demand is supporting infrastructure growth”. Preqin expects $2.74trn of investment by 2031, representing annualized growth of 9.8%. Growth is expected to be driven by the growing focus on power and energy security, digital connectivity, and supply-chain resilience, creating opportunities across infrastructure sectors, investment strategies and regions.
Meanwhile, regional growth opportunities are evolving across private markets, it said. Preqin expects that by 2031, North America will remain the largest market with more than $23trn in AUM, Europe will exceed $7trn and Apac will approach $3trn.
Cameron Joyce, global head of Preqin private markets research, said: “As private markets enter a new phase of growth, returns are likely to be driven less by broad market tailwinds and more by effective manager selection, underwriting discipline, and operational value creation.”
“At the same time, transformative themes such as AI are blurring traditional asset class boundaries, prompting investors to take a more holistic view of portfolio construction across public and private markets. Investors that leverage better data, deeper insights and a whole-portfolio view will be better equipped to identify opportunities and achieve superior investment outcomes.”