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Most investors think the Middle East has the highest growth potential for private capital in 2025, according to a survey of investors and allocators managing over USD 4 tn in assets conducted by Apex Group at the Apex Invest Abu Dhabi forum, according to a press release (pdf). Some 39% of attendees identified the region as the most promising for private capital deployment, followed by Asia-Pacific (30%) and North America (22%). Europe, Africa, and South America were rated lower due to socioeconomic and geopolitical reasons.
Private equity and venture capital are seen as the asset classes with the greatest potential for generating alpha — returns exceeding benchmarked market returns — in the near term. A significant 88% of participants indicated plans for increased engagement among private equity firms and VCs with portfolio companies to enhance returns and safeguard impact.
Impact investing is projected to play a more substantial role in asset management strategies over the next decade, with 71% of attendees forecasting a shift towards balancing risk-adjusted returns with impact considerations.
Also expected to remain hot for the foreseeable future: private credit.
Investors still see some barriers to portfolio diversification: Respondents signalled challenges like access to quality assets (54%), market volatility (21%), and regulatory constraints (13%) as potentially hampering portfolio diversification efforts.
