Private equity fundraising in Q1 2014 has registered the best Q1 total since 2008, with 208 funds collecting $102bn in aggregate capital commitments. This continues the trend of a thriving private equity industry seen by the strong performance in 2013, where capital garnered increased to a post-crisis record of $499bn, including $165bn raised in the final quarter of the year.
The 10 largest funds to reach final close in Q1 2014 accounted for $37bn (37%) of the total capital raised by funds closed in the quarter. A total of 27 funds closed in the quarter having raised at least $1bn in commitments, combined these funds raised $61bn in investor commitments. The 10 largest funds closed in Q1 2013 garnered $31bn and 21 funds closed having raised at least $1bn, combined these funds received $47bn in investor commitments.
Preqin’s Funds in Market online service shows that of the funds that raised at least $1bn in Q1 2014, buyout funds are the most common with eight such funds. It was also the fund type to secure the largest proportion of commitments ($19bn). This was closely followed by five real estate funds having secured almost $17bn. Four growth funds secured slightly over $8bn.
The largest fund to close in the first quarter of 2014 was Blackstone Real Estate Partners Europe IV; the opportunistic real estate fund secured its hard cap of €5.1bn in commitments for investments across Europe. The private equity infrastructure fund Energy Capital Partners III was the third largest fund to close in Q1 2014, surpassing its $3.5bn target, securing almost $5.1bn in commitments for investment in North America-based energy infrastructure, including power generation, renewables, electric transmission and midstream gas sectors. GTCR Golder Rauner raised the largest buyout fund closed in Q1, securing $3.85bn towards the final closing of Golder Thoma Cressey Rauner XI.
Fifty funds have reached a final close so far in Q2 2014 having raised $42bn, indicating that Q2 may surpass the capital raised in Q1. It is also likely that H1 2014 will see a greater level of private equity capital raised in comparison to the $234bn H1 fundraising level of 2013.