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The appeal of private assets in 2024

The macro environment in 2024 will likely spur demand for private assets from all types of investors in our view. In this higher-for-longer environment, private assets could continue to be a compelling source of risk-adjusted returns, income and diversification.


Private assets are not traded on public exchanges. They can include debt, equity, real estate, infrastructure, farmland and timberland. While covering a broad range of asset types, private assets share similar investment characteristics in many instances:

  • Stability: Private market pricing helps avoid public market noise, reducing volatility.

  • Return and income potential: Limited liquidity has often been viewed as a limitation, but that same illiquidity creates opportunities. Private markets are perhaps best known for their high return potential compared with similar public assets.

  • Resilience: Long-term cash flows are a feature of many private real assets often with contractual payments that adjust for inflation.

  • Diversification: Private real assets generally have low or negative correlations with listed equity and bonds, and bring additional sources of alpha to a portfolio.

What to expect in 2024? Find out more in the cards below:


Infrastructure should benefit from still-high inflation and looks well positioned for resiliency in the face of slowing economic growth.

Often these assets provide essential services such as power generation, water and waste management, roads, bridges, communication networks and data centres. Steady demand for their services coupled with limited competition due to their size and capital-intensive nature makes the assets less sensitive to economic cycles and changes in market conditions. They are also a stable source of income with cash flows generated from long-term contracts, which often adjust for inflation or a higher cost of capital, providing a further protection in challenging economic environments.

Private credit
Private credit

Private credit has proven its resiliency in 2023’s high-rate and high-inflation environment, and we expect this to continue in 2024. In our view, such challenging fundraising conditions can be the best time to invest.

The technical aspects of deal making have improved from a lender’s point of view. Higher base rates equate to higher yields. And higher interest costs alongside more conservative capital structures mean new deals are being structured with lower leverage multiples and covenants that are often more favourable to lenders.

Given the macro challenges for borrowers, diversification and selectivity are critical. We favour market-leading companies with stable, recurring cash flows in non-cyclical industries, making them well placed to service interest payments and pay back loans. We continue to focus on more resilient areas of the market — such as health care, software and business services — all of which, we believe, are relatively well-positioned to withstand economic downturns.

Real estate
Real estate

We see common themes across the global real estate landscape: inflation is moderating but sticky, interest rates remain elevated, value losses are subsiding, investment volumes are near 10-year lows and transactions arising from distress have remained muted despite pressures. However, we also see a lot of variation within markets and sectors, underscoring the potential benefits of a diversified global portfolio in 2024.

We expect retail will be a quiet outperformer. Years of negative sentiment have driven down values, creating a more attractive entry point for new investors. The alternatives sector, including self-storage, manufactured housing and outpatient care facilities, is positioned for future resilience and outperformance in our view. Their fundamental drivers rely less on economic growth and more on demographics, technology and health care. Affordable housing is another attractive sector, with demand outstripping supply in many parts of the world.

Natural capital
Natural capital

Natural capital’s inflation-hedging characteristics should serve investors well in 2024 with rates and inflation likely to remain elevated. Many of the outputs from farmland and timberland, such as food and building materials, are often components of inflation measures. Higher inflation reflects higher prices for these goods. In the near term, these higher prices improve performance by increasing cash yields. Over the long term, higher prices can also increase the capital appreciation component of return as they are incorporated into asset valuations.

But looking beyond current macroeconomic factors, long-term structural trends will likely transform the asset class from a niche investment to a core, resilient component of a long-term portfolio.


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