Goldman Sachs Asset Management said on the 18th that "for next year's private markets, it is time to pay attention to alternative investments," adding, "among them, it is necessary to focus on infrastructure investments led by artificial intelligence (AI) and the energy transition."
Announcing its 2026 investment outlook, Goldman Sachs Asset Management emphasized that "general partners (GPs) need to identify high-growth industries and readjust key investment regions." In particular, it expects rapid advances in data science, AI, and automation to boost investment profitability.
It also assessed that secondary and continuation funds will become more active. Harold Hope, global head of the Vintage Platform at Goldman Sachs Asset Management, said, "Limited partners (LPs) will continue to show interest in secondary investments with short holding periods," adding, "secondary and continuation funds will become key providers of liquidity."
There was also a view that the venture capital (VC) and growth equity ecosystem will revive. Investors with abundant dry powder (unspent capital in funds) are expected to proceed with investments even at high valuations. Goldman Sachs Asset Management explained, "Demand for capital seeking to invest in growth-stage companies is expanding."
Goldman Sachs Asset Management expects demand for private credit and mezzanine investments to grow alongside a more active mergers and acquisitions (M&A) market. James Reynolds, co-head of private credit at Goldman Sachs Asset Management, said, "As M&A transaction activity expands and interest in asset-backed lending increases, private credit will establish itself as an important source of financing going forward."
It predicted a potential rebound in the real estate market as expectations for interest rate cuts grow. This year, transactions recovered as increased liquidity supply aligned with demand for distributions, and activity is expected to be stronger next year. It advised that real estate fund dry powder is at its lowest level since 2020, opening new opportunities for real estate investors.
Jim Garman, global head of real estate at Goldman Sachs Asset Management, said, "Valuations and transaction volumes are showing signs of stabilization, and we expect investor sentiment to improve next year," adding, "real estate looks attractive in an environment of lower financing costs, but selecting what to invest in is important."
It analyzed that while digital transformation is the core task for the infrastructure sector, there are investment opportunities in areas such as waste, water resources, and recycling. Tavish Cannel, global head of infrastructure within Goldman Sachs Alternatives, said, "Next year, investment opportunities will increase in AI, digitalization, power generation and transmission, the changing global trade environment, and upgrades to aging infrastructure."