PERE’s 2025 Secondaries & Recapitalizations report reveals how continuation funds are reshaping the market.
As debt maturities mount and fundraising slows, the real estate secondaries market is stepping up to provide critical liquidity. Manager-led transactions surged last year, fueled by the growing adoption of continuation funds – now a go-to strategy for extending asset hold periods and unlocking capital. Meanwhile, recapitalizations are proving essential for preserving value in a volatile market and secondaries investors are capitalizing on market dislocation, targeting high-demand sectors like logistics and data centers.
INSIDE THE REPORT
Secondaries surge as private real estate investors seek solutions
Three major themes emerge in real estate secondaries as private equity investors and fund managers look for liquidity.
Secondaries provides inroads to in-demand sectors
As high interest rates, depressed values and fluctuating markets continue to squeeze investors, real estate secondaries is flourishing.
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As investors seek liquidity and managers look to increase value, continuation funds and recapitalizations are gaining popularity. And while 2023 saw a dip in deal activity, this appears to be a blip. Real estate secondaries should see continued growth, driven by increased demand for capital and attractive discounts, among other trends outlined in this report.
The last year has seen a sea change, with investor-led secondaries coming back into vogue as economic conditions have shifted. 2022 set a record for real estate secondaries transaction volume at $12.4 billion, but lost in that number is a slowdown for GP-leds which has continued into this year. While 2023 is shaping up to be a very different year to the one that went before, the LP-led revival suggests it will still be an active one.
No longer the exclusive domain of private equity specialists, real estate secondaries are a hive of activity right now. With Blackstone’s €21 billion recapitalization of Mileway billed as the largest private real estate deal of all time, and total secondaries transaction volumes surging, it is increasingly clear that secondaries and GP-led recaps – with their myriad benefits for both managers and investors – have become a strategic play in the private real estate market.
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