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FUNDRAISING NEWS | October 16, 2025

Real Assets, Private Credit, and AI Rebound Lead Q3 2025 Institutional Allocations

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In Q3 2025, institutional investors committed $62.3 billion across private markets, maintaining strong deployment levels while pivoting toward yield, liquidity, and infrastructure. Real Assets led with a 28% increase in allocations, while Private Credit continued its steady climb and Venture Capital rebounded on the back of AI enthusiasm.

Key Insights:

  • Real Assets Surged to $20.4B: Infrastructure and energy transition platforms dominated capital flows, including CPP Investments’ $1.33B commitment to Japan DC Partners I.

  • Private Credit Reached $15.9B: Allocators continued to favor floating-rate and structured credit strategies, with CalPERS allocating $800M to West Street Climate Credit.

  • Private Equity Moderated to $19.1B: LPs exercised pacing discipline, leaning into secondaries and re-ups with operationally strong, mid-market GPs.

  • Venture Rebounded 130% to $4.6B: Washington State committed $400M across Menlo’s AI- and infrastructure-focused funds, signaling a targeted return to innovation.

  • Hedge Fund Allocations Dropped 55%: LPs rebalanced away from liquid alternatives and into higher-yielding private strategies.

  • LP Spotlight: FSBA Commits $2.3B+: The Florida State Board of Administration deployed across private credit, equity, and real estate, showcasing a barbell approach to income and flexibility.

Download the Q3 2025 Institutional Allocations Report!

Written By: Dakota

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