Investors set to increase allocations to private debt

Investors are set to increase their allocations to private debt over the next 12 months, according to a survey from fund services provider Elian.

The data indicates that 60 per cent of investors believe the private debt market will grow over the coming year, and 41 per cent are likely to increase their allocation to the asset class in that time.

A total of 15 per cent said that they would increase their allocation significantly, while 29 per cent said that it would remain the same. 

“Complex strategies seen from traditional institutional lenders following the financial crisis have continued to weigh heavily on business growth,” said Charles Le Cornu, head of private equity at Elian. “As a result, there has been a significant increase in demand for forms of alternative lending, specifically as institutional investors come up against continuing low yields from mainstream fixed interest vehicles.”

The research also reveals that 73 per cent of investors said their private debt investments had met or exceeded expectations, while just 13 per cent reported their investments falling short.