Global private debt fundraising totalled $50.4bn in the second quarter of 2024, marking a significant rebound from a below-average first quarter, according to the latest data from alternative assets data provider Preqin.
The quarter’s performance places it fourth among the last eight second quarters, marking a return to more typical fundraising levels after a subdued Q1.
While Q2 showed improvement, Preqin noted that there is still some way to go to match the performance of previous years. The data provider’s latest report also highlighted that the average size of closed private debt funds reached $1.5bn, the highest in more than five years.
This increase is partly attributed to a decrease in the number of funds closed, with only 33 funds closing in Q2, the lowest number in at least five years.
RJ Joshua, Preqin’s head of private debt and fees, research insights, commented: “Although we expect some quarter-on-quarter volatility, this points to a continuation of the increased fundraising concentration we have seen, as highlighted in our Global Private Debt Report 2024.
“As such, fundraising in the second quarter is less broad-based than in previous quarters that achieved similar levels, and so, more fragile.”
Direct lending was the dominant strategy in Q2, accounting for 88% of the total fundraising with $44.5bn raised. This aligns with Preqin’s recent investor survey, which indicated that direct lending continues to be the preferred strategy among investors, with interest growing steadily over the past five years.
North America led the way in private debt fundraising, attracting nearly $40bn, which represents 79% of the global total. This trend is consistent with Preqin’s forthcoming Investor Outlook report, which shows the US as the most favoured developed market, with 89% of surveyed investors identifying it as offering the best investment opportunities.
In contrast, Europe saw significantly smaller average fund sizes. Among the nine funds raising capital in Europe, the average fundraising was $1.1bn per fund, compared to $2.7bn per fund across 15 funds in North America.
The Asia-Pacific region’s share of fundraising meanwhile, remained modest but showed growth, increasing from $0.4bn in Q1 to $1bn in Q2.
