Key Takeaways
- • Private credit AUM grew approximately one-third from 2020 to 2024, reaching $1.87 trillion, with projections to reach $2.46 trillion by 2028, creating structural demand for secondaries solutions.
- • Liquidity mismatches between investor expectations and actual loan repayment timelines are the primary driver accelerating growth in the private credit secondaries market as a portfolio management tool.
- • Continuation vehicles have emerged as mainstream mechanisms within the credit secondaries market, according to Jefferies Boardroom Intelligence research from July 2025, reflecting institutional acceptance of this strategy.
- • Private credit secondaries address three core investor needs: liquidity optimization, valuation transparency, and enhanced portfolio management sophistication across increasingly mature credit cycles.
- • The secondaries market provides strategic flexibility for general partners navigating expanding AUM and maturing credit portfolios while enabling limited partners to achieve exits without traditional liquidity constraints.
Summary
The private credit secondaries market is experiencing rapid expansion driven by structural growth in the broader private credit asset class and mounting liquidity pressures across investor portfolios. Private credit assets under management increased approximately one-third between 2020 and 2024, reaching $1.87 trillion, with forecasts projecting growth to $2.46 trillion by 2028. This substantial expansion has created corresponding demand for secondary market solutions as investors grapple with portfolio maturation and diverging liquidity expectations versus actual loan repayment timelines.
Liquidity constraints represent the primary catalyst fueling secondaries market activity. As private credit portfolios mature and AUM scales, limited partners increasingly seek mechanisms to access liquidity without awaiting traditional exit events. The secondaries market enables early stakeholders to achieve liquidity while providing general partners operational flexibility in navigating maturing credit cycles. This structural demand driver has proven durable over more than two decades of secondary market development and continues to accelerate as the asset class expands into new sub-strategies.
Continuation vehicles have evolved into mainstream portfolio management instruments within credit secondaries, reflecting increased institutional comfort with these structures. Investor motivation extends beyond liquidity alone, encompassing valuation optimization and enhanced portfolio sophistication. The market addresses three core investor requirements: providing liquidity for existing investments, enabling portfolio reoptimization, and offering strategic flexibility as the credit cycle matures.
Although private credit secondaries remain smaller in absolute value compared to established asset classes, the convergence of rapid primary market growth, escalating liquidity pressures, and institutional acceptance of secondaries mechanisms positions the market for sustained expansion. As the private credit industry continues its trajectory toward $2.46 trillion in AUM by 2028, secondary market solutions are expected to play an increasingly critical role in capital allocation and portfolio management strategies across institutional investors, family offices, and alternative asset managers.
Liquidity constraints represent the primary catalyst fueling secondaries market activity. As private credit portfolios mature and AUM scales, limited partners increasingly seek mechanisms to access liquidity without awaiting traditional exit events. The secondaries market enables early stakeholders to achieve liquidity while providing general partners operational flexibility in navigating maturing credit cycles. This structural demand driver has proven durable over more than two decades of secondary market development and continues to accelerate as the asset class expands into new sub-strategies.
Continuation vehicles have evolved into mainstream portfolio management instruments within credit secondaries, reflecting increased institutional comfort with these structures. Investor motivation extends beyond liquidity alone, encompassing valuation optimization and enhanced portfolio sophistication. The market addresses three core investor requirements: providing liquidity for existing investments, enabling portfolio reoptimization, and offering strategic flexibility as the credit cycle matures.
Although private credit secondaries remain smaller in absolute value compared to established asset classes, the convergence of rapid primary market growth, escalating liquidity pressures, and institutional acceptance of secondaries mechanisms positions the market for sustained expansion. As the private credit industry continues its trajectory toward $2.46 trillion in AUM by 2028, secondary market solutions are expected to play an increasingly critical role in capital allocation and portfolio management strategies across institutional investors, family offices, and alternative asset managers.
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