Australian Private Capital Market Overview 2024 (Australian Investment Council)

Summary

• Australia-focused private capital assets under management reached a record high of $139.0bn as of June 2023.p.7
• Real estate AUM grew by 28% in six months to June 2023 to become the largest asset class at $55.7bn.p.7
• Combined private equity and venture capital AUM stood at $65.5bn as of June 2023, comprising $45.5bn in private equity and $20.0bn in venture capital.p.7
• In 2023, 37 Australia-focused private capital funds raised $10.0bn, with the average fund size reaching a record high of $271mn.p.7
• Private equity-backed buyout deal value reached $13.2bn across 116 deals in 2023, with $7.9bn coming from secondary buyouts.p.8
• Venture capital deal flow totaled $3.8bn across 260 deals in 2023, falling 36.7% from 2022 but remaining more than double the 2015–2019 average of $1.5bn.p.8

Key insights

1. Australia-focused private capital funds with vintages 2013 to 2020 achieved a median net IRR of 14.5%, outperforming North America, Asia, and Europe.p.7
2. Consolidation among fund managers accelerated in 2023, with the five largest funds securing 61.2% of all capital raised compared to 38.6% in 2019.p.11
3. AUM of closed-end private credit funds reached $1.8bn as of June 2023, representing a 2.5x increase compared to 2020.p.5
4. Energy funds accounted for 62% of aggregate capital raised by Australia-focused unlisted infrastructure funds closed between 2017 and 2024.p.11
5. Secondary buyouts represented almost 60% of total private equity buyout aggregate deal value in 2023.p.19
6. Family offices expanded their share among active domestic private capital investors from 7% in 2019 to 36% in 2024.p.29
7. The Australian Government allocated almost $25bn to ESG initiatives and net-zero programs, including $20bn for Rewiring the Nation.p.33