Coller Capital’s Private Equity Barometer: Winter 2008-2009

Leading secondaries player, Coller Capital, has just published the latest installment in their Private Equity barometer series. Much of the information within can be taken in a “glass half-empty, glass half-full” context depending upon whether or not your an eternal optimist. The vast majority of LPs (a whopping 97%) plan on maintaining or increasing their allocations to private equity. Breaking it down even further shows that 40% of LPs plan an increased allocation (a proportion unchanged since the boom years) while 57% are looking to maintain. Investors’ return expectations for the medium term haven’t changed either with 43% of LPs still expect net annual returns of more than 16% over the next 3-5 years. The problem for investors is not appetite, but stretched allocations and a shortage of cash (these last two factors could also make upcoming capital calls fairly interesting).

The report shows that two out of three private equity investors (LPs) will have little or no ‘headroom’ for new fund commitments by this time next year, with North American LPs being particularly stretched — 28% of them expect to be over their allocations by December 2009. Another interesting little point is that over 75% believe that ready availability of capital is making it too easy for weak GPs to raise funds in Asia.

Here’s the report:

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