The fund management industry is on the brink of a major international expansion, Carne Group said in a survey released on Friday 1 March. There is a near-consensus among fund managers, with 96% of those managing alternative assets, equity and fixed income planning to significantly ramp up their efforts to secure capital in overseas markets by 2024.
This trend is particularly pronounced among US fund managers, with 18% indicating their intentions to tap into continental Europe for capital raising purposes for the first time this year. Moreover, a significant 30% of UK fund managers have echoed this sentiment, while 34% of their US counterparts are eyeing the UK market as a new avenue for fund-raising efforts.
European fund managers, with the UK excluded, are also looking towards Britain, with 33% planning to raise capital there for the first time in the next 12 months. This move has been facilitated by a recent announcement from the UK government, which deemed EU states equivalent under its overseas funds regime, thereby allowing EU Ucits funds to be marketed to UK retail investors.
The optimism among fund managers regarding fundraising activities extends across various fund types. Specifically, 83% anticipate that fundraising by real estate fund managers will surpass the levels seen in 2023. Similarly, expectations for increased capital raising are high among private equity funds (78%), private debt (66%) and hedge funds (56%).
John Donohoe, CEO of Carne Group, remarked on the findings, stating that 2024 is poised to be a bustling year for fund managers aiming to raise capital. He highlighted the strategic shift towards exploring new markets to achieve this goal, leveraging a variety of channels to facilitate capital raising.
Furthermore, Donohoe pointed out the expected benefits for all major fund domiciles from this trend, with Luxembourg and Ireland, in particular, predicted to experience strong growth. These jurisdictions are renowned as established hubs for Ucits and alternative investment fund structures, which are instrumental in attracting capital from investors in the UK, Asia-Pacific and the Middle East, noted Donohoe.
Spanning ten countries, the collected data from over 200 senior executives who collectively oversee assets worth $1.6trn. It was conducted between December 2023 and January 2024.