The secondaries market
Why secondaries?
Secondaries are best defined as the acquisition of pre-existing investor commitments in alternative investment funds, either directly from the seller (“LP-led”) or in the context of a restructuring the fund orchestrated by the manager (“GP-led”). Well-structured secondaries may offer higher net return and lower investment risk than primaries, driven by discounts to inherent value, swift capital deployment and visibility on underlying assets.
Differentiated access
Stafford has been a pioneer in infrastructure secondary investing. Our differentiated access has provided our investors with value-enhanced returns for core risk. Secondaries are an important tool also to mitigate J-curve and to access immediate yield.
Market growth
The infrastructure secondaries market has reached maturity over the last ten years, growing by a factor of 10 on the back of the growth of the primary market, reaching USD 7-10bn per annum in each of the GP-led and LP-led segments. LP-led secondaries shown below:
Infrastructure primaries, LP-led secondaries and dry powder
Data as of Jan-2023;
Source: Preqin, Infrastructure Investor, Stafford; (1) committed amount may include funds advised by Stafford other than SISF I-IV