Asian limited partners (LPs) are moving in the opposite direction to their global counterparts on GP relationships, with more than half expecting to add to their rosters over the next three years even as investors elsewhere look to consolidate, according to the 44th edition of the Coller Capital Global Private Capital Barometer.
The barometer surveyed 108 LPs who collectively oversee over $2 trillion in assets. Nearly 55% of these LPs from across the world manage more than $10 billion in assets.
According to the survey, 53% of Asian LP respondents expect their GP relationships to increase, contrasting sharply with the global picture. Almost a quarter (23%) of LPs expect to reduce GP relationships over the next three years, up from 16% when Coller Capital last asked the question in 2020.
The divergence reflects a broader pattern of Asian investors navigating a distinct set of considerations. Geopolitics is weighing more heavily on allocation decisions in Asia-Pacific than in North America, with 47% of APAC investors citing the geopolitical environment as a factor influencing their private markets allocation decisions more than in the past, compared with 37% globally.
The pressures shaping the environment are also visible in fund portfolios. More than half (54%) of LPs expect the number of zombie funds in their private equity portfolios to increase over the next two years, with a further 31% expecting the number to remain stable.
But Asian LPs are the most optimistic, with 31% expecting a reduction. Where zombie funds do emerge, LPs favour pragmatic solutions such as a management fee step-down (cited by 54% of respondents) and manager incentive resets (18%).
Asian LPs remain broadly constructive as the region shows strong appetite for secondaries as a portfolio management tool. Nearly 57% of Asian LPs expect continuation vehicles to be used more widely while 38% of North American respondents expect use of such structures to decline.
That appetite has a regional context. At DealStreetAsia’s Asia GP-led Secondaries Leadership Roundtable, Roy Kim of TPG NewQuest, Michael Weng of CPP Investments, Piyush Gupta of Kenro Capital and Ben Hart of Evercore made the case that continuation vehicles have matured into a legitimate fourth exit route. Asia’s capital formation gap remains real — but that, the panel suggested, is a scale problem, not a credibility one.
Asian LPs also display the strongest home bias in private credit manager selection. Nearly 64% view home-grown emerging private credit managers as more attractive than international counterparts, contrasting with 70% of LPs outside Asia who prefer international expertise.
LPs expect artificial intelligence to reshape private markets operations primarily as a cost-efficiency tool — 70% said as much — rather than a direct source of alpha. Around two-thirds (67%) believe AI adoption will widen return dispersion between leading and lagging managers.
Asia is again an outlier with 36% of regional investors attributing less importance to gut instinct in fund and co-investment decision-making, compared with 61% globally who say its importance has not changed. This indicates that Asian LPs may be faster to embed data-driven approaches into their decision-making processes.
According to Peter Kim, Partner and Head of APAC at Coller Capital, the LP base is not monolithic — and that regional perspectives are becoming an increasingly important part of how private markets evolve.
