Preqin – Saudi Mirror http://www.saudimirror.com News On-line Wed, 13 Dec 2023 08:00:00 +0000 en-US hourly 1 https://wordpress.org/?v=5.3.2 Global alternative assets remain resilient in 2023 amid economic uncertainty — Preqin Global Reports 2024 http://www.saudimirror.com/global-alternative-assets-remain-resilient-in-2023-amid-economic-uncertainty-preqin-global-reports-2024/ Wed, 13 Dec 2023 08:00:00 +0000 http://www.saudimirror.com/?p=217816 LONDON, Dec. 13, 2023 (GLOBE NEWSWIRE) — Today Preqin, the global leader in alternative assets data, tools, and insights, published its Alternatives in 2024 report, part of the Preqin Global Reports 2024. The report provides analysis on trends on key factors and trends driving the alternative assets industry.

While 2023 is a year so far characterized by market headwinds and a challenging fundraising environment for investors and fund managers alike, Preqin analysts remain optimistic about the outlook for global alternative assets. For instance, private debt fundraising fared relatively well in comparison to other private capital asset classes, while secondaries deal flow should start to pick up going into 2024 as the market comes back into balance.

Cameron Joyce, Head of Private Equity, Research Insights at Preqin, says, "Amid the formidable headwinds marked by swiftly tightening monetary policy and economic uncertainty, alternative assets have remained comparatively resilient. The industry continues to evolve rapidly, and promising opportunities are presenting themselves in areas such as private debt and secondaries. We continue to forecast solid growth for the industry despite softening expectations around fundraising and performance."

Key highlights from each asset class:

Private equity faces a stern test:

The private equity market has been hampered by rising interest rates "" which have weighed on deal activity "" and a constrained exit environment. Dealmakers are hoping for an increase in activity during 2024 and long–term investor appetite remains strong.

Venture capital investor sentiment on performance improves:

Venture capital returns have been challenged by factors such as the poor exit environment, elevated asset valuations, and climbing interest rates. Noting this, our latest investor survey shows that investors' outlook is shifting, and they are comparatively more positive on the performance of the asset class over the next 12 months.

Private debt fundraising holds up:

Private debt's floating–rate structure and seniority in the capital stack are especially attractive for investors seeking more defensive assets in challenging conditions, with strategies such as mezzanine debt growing in popularity.

Hedge funds' AUM rises despite net outflows:

Hedge funds' AUM growth has been driven primarily by asset returns and not inflows and outflows. In fact, hedge fund returns during months of market volatility proved that they can be effective in providing investors with downside protection. Niche strategies such as cryptocurrencies and insurance–linked securities (ILS) gained prominence due to their low public market correlation.

Real estate under pressure:

Rising interest rates have weighed on investment sentiment, resulting in weaker fundraising and deal activity. As investors flock toward larger funds in search of a sense of security, fundraising has been even more challenging for first–time and smaller funds.

Infrastructure may be turning a corner:

Fundraising fell sharply in 2023, a significant reversal after fund managers amassed record sums in 2022. But third–quarter deal activity proved robust and tailwinds from energy transition will continue to underpin the long–term growth of unlisted infrastructure.

For more information, contact Mimi Celeste Taylor at mimiceleste.taylor@preqin.com.

Notes to the editors

Alternatives in 2024 is a freely available version to accompany the Preqin Global Reports 2024. This complimentary report explores the impact of macroeconomic headwinds and market volatility on alternative assets this year and beyond.

If you are a full–time member of the press and would like to receive a full copy of any of the following reports, please get in touch: Private equity, venture capital, private debt, hedge funds, real estate and infrastructure. For non–press, the 2024 Preqin Global Reports are available for Preqin Insights+ subscribers.

About Preqin

Preqin, the Home of Alternatives, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for over 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.


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Number of active GPs in Gulf Cooperation Council doubles as domestic opportunities emerge — Preqin reports http://www.saudimirror.com/number-of-active-gps-in-gulf-cooperation-council-doubles-as-domestic-opportunities-emerge-preqin-reports/ Mon, 06 Nov 2023 09:34:21 +0000 http://www.saudimirror.com/?p=217473 LONDON, Nov. 06, 2023 (GLOBE NEWSWIRE) — Preqin, the global leader in alternative assets data, tools, and insights, published its Private Capital in the Gulf Cooperation Council 2023: Preqin Territory Guide report. The report explores how the alternatives market in the Gulf Cooperation Council (GCC)* is increasingly looking to domestic investment opportunities, beyond oil.

Years of growth paint a picture of optimism

The GCC's assets under management (AUM) in private capital hit $1bn in December 2008, reaching $5.8bn as of December 2021, before more than doubling to $12.3bn in 2022, according to Preqin data. Saudi Arabia holds the lion's share of this AUM in Dec 2022 at $10.0bn, followed by the United Arab Emirates (UAE) AUM with $2.1bn.

Preqin data and insights in the report point to how the GCC is emerging as a potential destination for capital deployment. This trend is demonstrated by the growing number of active fund managers and headline deals being completed by investors such as Blackstone, CVC Capital Partners, Silver Lake, and Apollo. Furthermore, the 529 active GPs in GCC member countries as of 2023 has nearly doubled from 268 in 2018.

An important factor driving change across alternative assets in the GCC is the role of the countries' sovereign wealth funds (SWFs). Middle East–based SWFs, with combined AUM of more than $3.7tn as of March 2023, are among the biggest investors in alternative assets. Average allocations in 2022 surged to an unprecedented 44% of AUM in December 2022, representing an increase from 22% from December 2021.

David Dawkins, report author, at Preqin says, "As GCC leaders focus on domestic employment opportunities for their young population, the region's SWFs are becoming more focused on domestic investments. Even a small uptick of the domestic fund alternatives allocations would have a transformative impact on the GCC's private capital GPs."

Key findings from the Private Capital in the Gulf Cooperation Council 2023 report include:

  • Venture capital: AUM for venture capital in the GCC reached $2.9bn as of December 2022, up from $1.5bn in December 2021. A change in investor sentiment towards the region has attracted capital into venture capital funds, with dry powder quadrupling from $400mn in December 2021 to $1.63bn at the end of 2022.
  • Fundraising: In 2022, 23 venture capital funds closed with aggregate capital raised of around $2.5bn. In real estate, between September 2021 and September 2023 year–to–date (YTD), 81 funds have closed with an aggregate capital raised of $2.3bn. And in private equity, between 2018 and 2020, 38 funds closed at an aggregate raise of $1.7bn. In other words, 142 funds in the GCC, between 2018 and 2023, raised a total $6.5bn.
  • Private equity: AUM for private equity in the GCC reached $2.2bn in December 2022, up from $1.25bn in December 2021.
  • Private debt: Half of the GCC's LPs (50%) surveyed by Preqin earlier this year stated they plan to increase allocations to private debt, compared with just 25% looking to decrease. Not only is this more than any other alternative asset class, it is a full six percentage points higher than our poll of investors globally.

For more information, and to receive a full copy of the report contact, Mimi Celeste Taylor at mimiceleste.taylor@preqin.com

Notes to the editors

* The Gulf Cooperation Counci (GCC) consists of the intergovernmental, political, and economic union of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

About Preqin

Preqin, the Home of Alternatives, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for over 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.


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Asia and Middle East sovereign wealth funds drive AUM growth — Preqin reports http://www.saudimirror.com/asia-and-middle-east-sovereign-wealth-funds-drive-aum-growth-preqin-reports/ Wed, 14 Jun 2023 08:00:00 +0000 http://www.saudimirror.com/?p=216332 LONDON, June 14, 2023 (GLOBE NEWSWIRE) — Today Preqin, the global leader empowering the alternatives community with essential data and insight, published its Sovereign Wealth Funds 2023 report. The report provides data and analysis on key trends in the sovereign wealth funds landscape*, as these investors look towards making enhanced allocations to alternative assets, as well as narrowing the gap between actual and target allocations.

The report demonstrates that alternative assets will continue to have a place in the portfolios of sovereign wealth funds if they provide diversification benefits and good risk–adjusted returns. With their abundant financial resources and increasingly sophisticated investment teams, sovereign wealth funds have the kind of capital that can give them access to top–performing funds.

Preqin's Sovereign Wealth Funds Report 2023 key facts:

  • Assets under Management (AUM): In the last decade, global sovereign wealth funds have doubled their AUM total to $10.4tn by the end of Q1 2023.
  • Asia: Asia's sovereign wealth funds led the increase in AUM, standing at $4.3tn by the end of Q1 2023. Notably, China Investment Corporation's total AUM of $1.35tn surpassed Norway's Government Pension Fund Global (GPFG) AUM of $1.2tn to become the largest sovereign wealth fund in the world.
  • Middle East: The Middle East is home to some of the largest sovereign wealth funds which hold the second most in AUM of all regions globally, behind Asia. At $3.7tn, they account for 36% of the global sovereign wealth fund AUM.
  • Allocations: Allocations of sovereign wealth funds to alternative assets as percentages of total allocations increased between 2021 and March 2023 in all asset classes, except for infrastructure. The biggest increase in the current median allocation was in real estate, from 6.5% in 2021 to 8.6%, by the end of Q1 2023.
  • ESG: Sovereign wealth funds are influential in promoting environmental, social and governance (ESG) goals. Sovereign wealth funds with an ESG policy represent 59% of total sovereign wealth fund AUM, up 5 percentage points from 54% in 2021.

Middle Eastern sovereign wealth funds show increased appetite for alternatives

As the sheer amount of fresh capital managed by Middle East–based sovereign wealth funds far exceeds the needs and capacity of their domestic capital markets, their appetite for alternative assets has risen. Preqin analysis of Middle East–based sovereign wealth fund data shows that the average allocations to alternatives have doubled year–over–year at the end of 2022, rising from 22% of total assets at the end of 2021 to 44%. While some of this is driven by the very high allocation levels of some of smaller sovereign wealth funds in the region, this trend reflects their ongoing pursuit of non–traditional assets to boost returns. Percentage allocations are also likely to be boosted by falls in the valuations of public equities and bonds in 2022, according to the latest data. The increase shows the flexibility that these Middle Eastern sovereign wealth funds have when making investment decisions, as they often have fewer short and medium–term liabilities than other types of institutional investors.

Growth in private debt

The Preqin report also found that global limited partners (LPs), including sovereign wealth funds, have developed a larger appetite for private debt in search of a steady income stream. Initially, one of the attractions of private debt was that it paid higher rates than public fixed income interest rates. However, as rates have increased, private debt has continued to attract investors. This is in part because the prevalent floating rate structures provide protection against rate rises.

According to Preqin, direct lending remains the most popular strategy, accounting for 46% of all 112 private debt fund commitments by sovereign wealth funds. As of the end of Q1 2023, the median current allocation to private debt is 2.5%, almost reaching the median target allocation of 2.6%.

Harsha Narayan, Managing Editor and lead author of the report at Preqin, says: "Sovereign wealth funds have continued to build sophisticated in–house teams and are increasingly able to act more like a fund manager when deploying capital. They leverage talent, technology, and partnerships, with fund managers and investors to invest in various alternative asset classes, and they are growing more competent to conduct direct or co–investment deals."

If you would like more information or would like to speak with the report author, contact Mimi Celeste Taylor at mimiceleste.taylor@preqin.com

To sign up to receive Preqin First Close, our newsletter, click here

Notes to the editors

It is important to note that sovereign wealth funds (SWFs) are created with different objectives. Some are set up primarily for diversification and only invest globally outside of their home countries, whereas others invest domestically with the objective of boosting homegrown markets. Some SWFs, such as Norway's GPFG, invest heavily in public markets and are relatively more conservative toward unlisted assets, while others take on more risk and pursue direct investments in more niche sectors. These factors affect how SWFs deploy capital.

* This report is based on insights and analysis of 95 sovereign wealth funds as defined and tracked by Preqin

About Preqin

Preqin, the Home of Alternatives, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.


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Preqin Publishes New Territory Guide: Real Estate in Saudi Arabia 2023 http://www.saudimirror.com/preqin-publishes-new-territory-guide-real-estate-in-saudi-arabia-2023/ Mon, 13 Feb 2023 08:00:00 +0000 http://www.saudimirror.com/?p=215297 LONDON, Feb. 13, 2023 (GLOBE NEWSWIRE) — Preqin, the global leader in alternative assets data, tools, and insights, published its Real Estate in Saudi Arabia 2023: Preqin Territory Guide. The report shows that while fundraising for closed end real estate funds in Saudi Arabia has been slowing in recent years, there may be an increase in activity this year with a number of funds currently open to investment.

The Preqin Territory Guide series gives alternatives investors data–driven insight on the opportunities in a particular market or region.

Monumental investments in real estate planned in Saudi Arabia

Real estate is at the heart of Saudi Arabia's vision of its future. The Kingdom is rich in oil revenues, but is also cultivating private finance and expertise from both domestic and international sources to deliver its Vision 2030 ambitions. Furthermore, there are developing plans for monumental investments in real estate, such as the $500bn Neom desert city project. While the asset class has long been a core component of investor portfolios in Saudi Arabia, it's not a fully institutionalized market. Investors have plenty of options to gain exposure to the region, with access routes including real estate investment trusts (REITs), separately managed accounts (SMAs), club and direct deals, and small but ambitious private fund managers.

Offering enhanced insights into the region, Preqin is now tracking 35 real estate fund managers in Saudi Arabia. Data shows assets under management (AUM) in closed–end funds at Saudi Arabia–based managers stand at $3.2bn at the end of June 2022, with dry powder of $537mn, the majority of which is in core strategies.

The pace of fundraising might be slowing, but an increase could be on the horizon

The fundraising market in the region has slowed in recent years, with the number of private real estate funds closing annually from a peak of 11 in 2017. However, there may be an increase in activity this year, with 9 Saudi Arabia–based real estate funds currently open to investment. The largest managers in the region, as measured by funds raised over the past 10 years, are Blominvest Saudi Arabia ($1.0bn), the Investor for Securities Company ($903bn), and Jadwa Investment ($747mn), followed by Alkhabeer Capital ($375mn), Al Rajhi Capital ($336mn), Tharwat For Financial Securities ($317mn), and Albilad Capital ($304mn).

Furthermore, in terms of the prospects for international investors, with its Public Investment Fund (PIF), Saudi Arabia has an entity that can pull expertise and capital into the country. The $620bn AUM sovereign wealth fund, already one of the world's largest investors in alternative assets, has a strategic goal to provide access to capital from the private sector and its other strategic partners, also with a view to gain exposure to international domain expertise associated with such capital.

However, while Preqin analysts believe a reversal in fundraising trends might be a possibility, it must be noted that this is a particularly opaque corner of the alternatives market and many funds that have closed in the past few years did not disclose the amount of capital they had raised.

David Lowery, SVP, Head of Research Insights, says, "We see strong fundamentals for real estate in Saudi Arabia. This is illustrated by the country's GDP which was estimated to have increased by 8.6% in the year to Q3 2022, with inflation running at a relatively low rate of 2.5%. While real estate deal activity across all segments is constrained by a lack of supply, the hospitality sector is enjoying a post–COVID–19 boom, underpinned by the recovery in religious tourism and continued growth in entertainment and conferences."

Key Preqin Real Estate in Saudi Arabia 2023 facts:

  • AUM: Closed–end funds' AUM at Saudi Arabia–based managers reached $3.2bn by the end of June 2022
  • Funds: 9 Saudi Arabia–based real estate funds tracked by Preqin are currently raising capital
  • Dry powder: Preqin data shows $537mn in dry powder in closed–end real estate funds in Saudi Arabia

For more information, and to receive a full copy of the report, contact Dawn Bowles, Senior Marketing Manager, Regional Marketing, Growth Markets, at dawn.bowles@preqin.com

– Preqin Pro data covers unlisted closed–end real estate funds. The charts and tables in the report are for this segment of the real estate market in Saudi Arabia only

– All reference to "$' is USD

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About Preqin

Preqin, the Home of Alternatives, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.


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