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Private Markets

2024 Private Markets Outlook

In BlackRock’s 2024 Private Markets Outlook, our investors discuss the past year for each asset class and explore where each one is going in terms of specific opportunities, the current risks, and some of the shifts that make this a unique time for private markets investors.

Embracing a changing world

Despite continuing uncertainty, we are embracing the structural changes reshaping our world. And private markets are uniquely positioned to benefit from these mega forces: digital disruption and AI, the low-carbon transition, demographic divergence, the future of finance and geopolitical fragmentation. Whether it’s infrastructure’s importance to the transition or the role of real estate in helping societies adapt to demographic change, private capital will be essential.

We believe private markets are sometimes viewed as a single investment option, but as this Outlook shows, they span different sectors, geographies, investment styles, and risk appetites. There is no one type of “private asset” and the key to a successful portfolio is recognizing the differences and choosing the right option for an investor’s needs.

Key takeaways

  • While the markets remain volatile, the ongoing shifts to the broader economy and investing landscape have poised private markets for growth.
  • The mega forces reshaping our world drive many of the opportunities we see across different private asset classes.
  • Continued volatility and persistent inflation has highlighted infrastructure’s resilient cashflows, while the essential nature of many infrastructure assets mean it is less tied to economic cycles than other asset classes.
  • While private debt continues to grow, the higher cost of capital will drive dispersion. A nuanced and defensive approach will be critical in 2024.
  • In private equity, high interest rates are driving cash-strapped companies to seek more equity financing, while low transaction volumes are creating attractive situations for buyers in the secondary market.
  • While real estate values are resetting, there are attractive opportunities in several property types, including industrial and logistics, necessity retail and some types of residential.

Mega forces

In the full report, our investment teams take a deep dive into individual mega forces. While the mega forces create opportunities across all asset classes, here are some specific examples of how investors can benefit.
Clean energy infrastructure, along with electrification, is essential to the transition to a low-carbon economy.
Private debt
Structural shifts in public financing markets have provided private debt an opportunity to expand its addressable market.
Private equity
There’s a strong opportunity set in the tech sector with companies that have recurring revenue streams, for example cloud computing and software.
Real estate
The shift across different cohorts creates opportunities across the sectors, such as student housing, multi- and single-family rentals, and medical offices.

A story of resiliency

As an asset class, infrastructure is having a moment. Stubbornly high inflation, along with the recent volatility in stock and bond markets, has revealed the inherent strengths of many infrastructure investments.

Long-term structural trends support infrastructure investment in the years and decades ahead. The world is in transition, requiring a reconfigured energy system and investment across all sectors to decarbonize. Digital infrastructure is expanding around the globe, increasing demand for fiber broadband, cell towers and data centers.

Supply chains are also being decoupled and rewired as geopolitical fragmentation accelerates ongoing trends toward onshoring, nearshoring and friend-shoring. This is driving fresh investment in key logistics infrastructure such as railways and ports.

Steady across market cycles

Infrastructure assets have shown resilient income and capital appreciation

Infrastructure assets have shown resilient income and capital appreciation

Source: BlackRock, 19 September 2023 with data from Bloomberg and EDHEC. Notes: The yellow stacked area shows the breakdown of the EDHEC Infra300 index into income return and capital appreciation. Direct infra is represented by the EDHEC infra 300 index; Global Equities is the MSCI ACWI Global Equities and Fixed Income is BBG Barclays Global Aggregate Index. Infrastructure figures in the graph have been calculated using averages through the year to account for lagging data and valuation figures. Past performance is not indicative of future results. All investing is subject to risk, including possible loss of money invested. Performance results will vary. Accordingly, performance may be higher or lower than results cited. Index returns are for illustrative purposes only.

Private debt

Dispersion, not disruption

Private debt continues to grow and cement its status as a sizable and scalable asset class for a wide range of long-term investors. Totaling more than US$1.6 trillion globally, as of March 20231, it represents roughly 12% of the US$13 trillion alternative investment universe.

The addressable market in private debt has expanded significantly over the past decade, as banks and public lenders have moved away from the middle market. As a result, direct lenders have funded larger deals, and investors now increasingly turn to private debt to access the income opportunities presented by middle-market companies.

In 2024, the higher cost of capital is likely to impact sectors and firms differently, due to their varying degrees of pricing power, business strength, and capital-structure management. This backdrop will be an important driver of dispersion, not disruption, across asset classes, sectors and issuers.

An increasingly essential asset

Private debt now represents 12% of alternative assets under management (unrealized value and dry powder)

Chart of private debt now represents 12% of alternative assets under management

Source: 1. Preqin 2. BlackRock, Preqin. As of each calendar year-end. 2023 is as of March 2023 (most recent available). To avoid double counting of available capital and unrealized value, fund of funds and secondaries are excluded.

Private equity

Adjusting to a new era

Private equity is in a period of adjustment amid the new era of higher rates and market uncertainty. We remain positive, however, on the asset class given its historical outperformance during times of market volatility, and signs that near-term opportunities could be attractive for buyers with access to capital. This new era is characterized by some key themes.

Chart of Steady valuations

Source: 1. Bank of America, S&P LCD Leveraged Buyout Quarterly Review & Pitchbook as of September 2023; figures based on United States leveraged buyouts.

Deal activity

Rising rates, inflationary pressure, economic and geopolitical uncertainty and a correction in the broader public equity markets have driven slower deal activity.


The correction in the public markets is beginning to translate to moderately lower private equity valuations.

Types of transactions

Firms are turning their attention to add-on acquisitions and taking advantage of depressed public equity valuations to execute take-private transactions.

Equitization of transactions

Less availability and higher cost of debt has forced private equity buyers to increase equity contributions to complete transactions.

Real estate

Value in volatility

The window of opportunity is opening up for real estate investors.

Globally, valuations are still adjusting down from their 2022 peaks, as a result of higher inflation, interest rates and volatility. This dislocated environment allows investors to purchase high-quality assets at attractive prices, and often below replacement cost. And bid-ask spreads are starting to narrow as investors command higher risk premiums across the board.

Historically, the real estate asset class tends to perform well after periods of dislocation. And we believe this environment of repricing amid steady market fundamentals represents a great opportunity. There are, however, strong headwinds. Transaction volume globally is down 57% year-over-year1, largely due to the higher cost of capital. In the near term, limited financing availability will likely contribute to an environment that’s very different from the low-rate world that followed the global financial crisis.

Dispersion has defined the asset class since mid-2022, when interest rates started to affect the private markets, and will likely be a major investment theme in 2024.

Chart of opportunities in uncertain times

Source: 1. MSCI, as of June 30, 2023 2. MSCI U.K. Quarterly Property Index, NCREIF Index, peak to trough GFC: 1Q2008-1Q2010, 1Q2010 starting for cumulative returns. MSCI, PMA, NCREIF and BlackRock, 3. U.K. data is from the MSCI U.K. Property Monthly Index as of September 2023. U.S. data is from The NCREIF Property Index as of June 30, 2023. The figures relate to past performance. Past performance is not a reliable  indicator of current of future results.

Explore the full report

Discover insights and perspectives from our private markets senior leaders. They discuss the past year and explore where the opportunities are for each asset class, and also take a close look at some of the structural shifts that are reshaping our world.
2024 Private Markets Outlook

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