Alternative investment funds on rise in Luxembourg

The number of private equity funds in Luxembourg with more than €1 billion in assets has doubled since last year.

The size of the average PE fund has also increased by 50% since 2018, a survey by the Association of the Luxembourg Fund Industry (Alfi) and Deloitte found. The Grand Duchy now accounts for 4.3% of the global private equity industry.

Real estate Reserved Alternative Investment Fund (RAIF) launches increased by over 130% in one year, according to the study.

A separate survey by Alfi and KPMG showed a 14.5% climb in assets under management (AuM) in Luxembourg private debt funds, to a total of over €56 billion, representing an impressive 40% increase over the last two years. This is on top of the 23.5% growth in AuM seen from 2017.

Direct lending strategies almost doubled to 32% of the private loan market, up from 18%. High yield bond strategies remained stable at 22% whilst senior loans dropped from 35% in 2018 to 22% in 2019.

Corinne Lamesch, chairwoman of Alfi, said: “These reports highlight robust growth across all three asset classes for Luxembourg-domiciled funds as they become increasingly attractive outside the EU.”

©2019 funds europe

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