JP Morgan Asset Management Alternatives Outlook 2025: Top 4 High Conviction Alternatives are Transport, United States REITs, Private Credit Secondaries & Private Equity Secondaries, Top 3 Themes Impacting Alternatives Landscape are 1) Pro-Growth Policies & Return Enhancing Opportunities, 2) Tariffs, Trade Tensions & Inflation, 3) High-for-Longer Interest Rates, Commercial Real Estate Delinquents in 2024 are Office 10.4%, Retail 8.7%, Hotel 5.4%, Multifamily 2.8% & Industrial 0.3%
27th February 2025 | Hong Kong
JP Morgan Asset Management has released the Alternatives Outlook 2025, providing key insights in alternative investments in 2025. Top 3 Themes impacting alternatives landscape – 1) Pro-growth policies & return-enhancing opportunities, 2) Tariffs, trade tensions & inflation, 3) High-for-longer interest rates. Top 3 Views on Alternatives Investment – Global transport assets, Secondaries, United States real estate. High Conviction Alternatives – Transport, United States REITs, Private Credit Secondaries, Private Equity Secondaries. Medium Conviction Alternatives – Private Real Estate, Infrastructure, Global Listed Real Assets, United States Real Estate Mezzanine Debt. Low Conviction Alternatives –Timberland, United States CMLs. Top 6 United States Private Equity investments by sector in 2024 – Business to business (B2B) 29.4%, Technology 23%, Business to consumer (B2C) 14.8%, Financial services 11.4%, Healthcare 11.1%, Natural resources 10.4%. Top 6 United States Private Equity investments by sector in previous 10 years (2014 to 2023) – Business to business (B2B) 28.7%, Technology 21.2%, Business to consumer (B2C) 16.8%, Healthcare 13.7%, Natural resources 11.7%, Financial services 7.8%. United States Private Equity exits in 2024 Corporate Acquisition 49.1%, Secondary Buyout 41.8%, Public Listing 9.1%. United States Private Equity exits in previous 10 years (2014 to 2023) – Public Listing 28.7%, Corporate Acquisition 16.8%, Secondary Buyout 11.7%. Commercial Real Estate delinquents in 2024 – Office 10.4%, Retail 8.7%, Hotel 5.4%, Multifamily 2.8%, Industrial 0.3%. See below for key findings | View report here
” JP Morgan Asset Management Alternatives Outlook 2025: Top 4 High Conviction Alternatives are Transport, United States REITs, Private Credit Secondaries & Private Equity Secondaries, Top 3 Themes Impacting Alternatives Landscape are 1) Pro-Growth Policies & Return Enhancing Opportunities, 2) Tariffs, Trade Tensions & Inflation, 3) High-for-Longer Interest Rates, Commercial Real Estate Delinquents in 2024 are Office 10.4%, Retail 8.7%, Hotel 5.4%, Multifamily 2.8% & Industrial 0.3% “
Jed Laskowitz, Global Head of Private Markets and Customized Solutions: “Our 2025 Alternatives Outlook leverages our more than 50-year track record as a private markets investor, and this year’s outlook comes at a time when many types of investors are evaluating their allocations to alternatives. With the US economy in a mid-to-late cycle stage, private markets present potential opportunities for enhanced returns versus public markets, inflation protection, and diversification benefits.”
Anton Pil, Global Head of Alternatives Solutions: “In an environment where traditional portfolios face headwinds such as high valuations, positive stock-bond correlations, and persistent rate volatility, the case for alternatives becomes increasingly compelling. These conditions underscore the importance of diversifying with alternative investments to achieve more resilient portfolio outcomes.”
JP Morgan Asset Management Alternatives Outlook 2025: Top 4 High Conviction Alternatives are Transport, United States REITs, Private Credit Secondaries & Private Equity Secondaries, Top 3 Themes Impacting Alternatives Landscape are 1) Pro-Growth Policies & Return Enhancing Opportunities, 2) Tariffs, Trade Tensions & Inflation, 3) High-for-Longer Interest Rates, Commercial Real Estate Delinquents in 2024 are Office 10.4%, Retail 8.7%, Hotel 5.4%, Multifamily 2.8% & Industrial 0.3%
JP Morgan Asset Management has released the Alternatives Outlook 2025, providing key insights in alternative investments in 2025. See below for key findings | View report here
JP Morgan Asset Management Alternatives Outlook 2025
Summary
- Top 3 Themes impacting alternatives landscape – 1) Pro-growth policies & return-enhancing opportunities, 2) Tariffs, trade tensions & inflation, 3) High-for-longer interest rates
- Top 3 Views on Alternatives Investment – Global transport assets, Secondaries, United States real estate
- High Conviction Alternatives – Transport, United States REITs, Private Credit Secondaries, Private Equity Secondaries
- Medium Conviction Alternatives – Private Real Estate, Infrastructure, Global Listed Real Assets, United States Real Estate Mezzanine Debt
- Low Conviction Alternatives –Timberland, United States CMLs
- Top 6 United States Private Equity investments by sector in 2024 – Business to business (B2B) 29.4%, Technology 23%, Business to consumer (B2C) 14.8%, Financial services 11.4%, Healthcare 11.1%, Natural resources 10.4%
- Top 6 United States Private Equity investments by sector in previous 10 years (2014 to 2023) – Business to business (B2B) 28.7%, Technology 21.2%, Business to consumer (B2C) 16.8%, Healthcare 13.7%, Natural resources 11.7%, Financial services 7.8%
- United States Private Equity exits in 2024 Corporate Acquisition 49.1%, Secondary Buyout 41.8%, Public Listing 9.1%
- United States Private Equity exits in previous 10 years (2014 to 2023) – Public Listing 28.7%, Corporate Acquisition 16.8%, Secondary Buyout 11.7%
- Commercial Real Estate delinquents in 2024 – Office 10.4%, Retail 8.7%, Hotel 5.4%, Multifamily 2.8%, Industrial 0.3%
JP Morgan Asset Management Alternatives Outlook 2025
1) Alternatives Outlook 2025
Top 3 Themes impacting alternatives landscape:
- Pro-growth policies & return-enhancing opportunities
- Tariffs, trade tensions & inflation
- High-for-longer interest rates
Top 3 Views on Alternatives Investment:
- Global transport assets are well-positioned for changes in global trade and inflation
- Secondaries offer more efficient access to a potential pickup in private equity activity
- United States real estate offers compelling valuations, a growth tailwind and inflation protection
2) Alternatives Opportunities
Alternatives Opportunities:
- Private Real Estate – United States, Europe, APAC
- Private Real Assets – Infrastructure, Transport, Timberland
- Listed Alternatives – United States REITs, Global Listed Real Assets
- Private Alternative Credit – United States Real Estate Mezzanine Debt, United States CMLs, Private Credit Secondaries
- Private Equity – Private Equity Secondaries
High Conviction Alternatives:
- Transport
- United States REITs
- Private Credit Secondaries
- Private Equity Secondaries
Medium Conviction Alternatives:
- Private Real Estate
- Infrastructure
- Global Listed Real Assets
- United States Real Estate Mezzanine Debt
Low Conviction Alternatives:
- Timberland
- United States CMLs
3) United States Private Equity
Top 6 United States Private Equity investments by sector in 2024:
- Business to business (B2B) – 29.4%
- Technology – 23%
- Business to consumer (B2C) – 14.8%
- Financial services – 11.4%
- Healthcare – 11.1%
- Natural resources – 10.4%
Top 6 United States Private Equity investments by sector in previous 10 years (2014 to 2023):
- Business to business (B2B) – 28.7%
- Technology – 21.2%
- Business to consumer (B2C) – 16.8%
- Healthcare – 13.7%
- Natural resources – 11.7%
- Financial services – 7.8%
United States Private Equity exits in 2024:
- Corporate Acquisition – 49.1%
- Secondary Buyout – 41.8%
- Public Listing – 9.1%
United States Private Equity exits in previous 10 years (2014 to 2023):
- Public Listing – 28.7%
- Corporate Acquisition – 16.8%
- Secondary Buyout – 11.7%
4) Real Estate Insights
Private Real Estate returns in different inflationary landscape (1978 to 2024)
- High + falling inflation: +7.9%
- High + rising inflation: +10.7%
- Low + falling inflation: +5.8%
- Low + rising inflation: +9.8%
Commercial Real Estate delinquents in 2024:
- Office – 10.4%
- Retail – 8.7%
- Hotel – 5.4%
- Multifamily – 2.8%
- Industrial – 0.3%
Commercial Real Estate delinquents in previous 22 years (2001 to 2023):
- Hotel – 5.9%
- Retail – 4.8%
- Multifamily – 4.4%
- Industrial – 3.9%
- Office – 3.9%
5) Alternatives Insights
Key Highlights:
- Trade tensions during the first Trump administration, along with supply chain issues during the pandemic, reversed the decades-long trend toward greater globalization. A second Trump administration could result in greater protectionism and new trade dynamics across the globe.
- Fiscal policy deployed around the world may help sustain economic growth, but proposed policies in the United States may extend the impressive run of United States exceptionalism
- Pro-growth policies could spur dealmaking & exits
- Utilities and real estate can provide protection against inflation by passing on costs
- After a period of global synchronized rate cuts followed by synchronized rate hikes, 2025 could be a year of divergent monetary policy.
- Higher financing costs could put pressure on lower-quality borrowers in private credit
- Delinquencies remain elevated in the office sector
- Currency and interest rate volatility may provide macro hedge funds with opportunities for alpha generation
- Currency and interest rate volatility may provide macro hedge funds with opportunities for alpha generation
- As shifting government and monetary policy unfolds across the world in 2025, alternatives may aid investors in navigating portfolio opportunities and challenges that arise.
Key Opportunities:
- For investors seeking to capture near-term opportunities over the next 12 to 24 months arising from the shifting policy environment and the fundamental backdrop, our Alternatives Investment Strategies & Solutions (AISS) team highlights several liquid, core alternative options, including real estate, global transport and private equity secondaries.
- Pro-growth policies may not be universal across the world, but private equity, private credit and parts of real estate are poised to benefit from U.S. tax reform, deregulation and the associated boosts to economic growth. Infrastructure may also benefit from public and private spending around the world.
- Investors seeking to capitalize on trade shifts can consider transport assets. To protect against potential inflation shocks, infrastructure, real estate and transport are particularly well positioned.
- Monetary policy may create winners and losers in 2025, raising financing costs for private equity and exposing less creditworthy borrowers in private credit and commercial real estate, but generating volatility ripe for hedge funds to exploit.
JP Morgan Asset Management
J.P. Morgan Asset Management is a global leader in alternatives, with over 60 years of experience managing alternative investments, including real estate, private equity, private credit, liquid alternative products, infrastructure, transport, hedge funds, and forestry. As of December 31, 2024, J.P. Morgan oversees more than $400 billion in alternative assets. With $3.6 trillion in assets under management as of December 31, 2024, J.P. Morgan Asset Management serves institutions, retail investors and high net worth individuals in every major market globally. The firm offers comprehensive investment management services in equities, fixed income, alternatives, and liquidity. JPMorgan Chase & Co. (NYSE: JPM) is a leading financial services firm based in the United States of America (“U.S.”), with operations worldwide. JPMorganChase had $4.0 trillion in assets and $345 billion in stockholders’ equity as of December 31, 2024. The Firm is a leader in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing and asset management. Under the J.P. Morgan and Chase brands, the Firm serves millions of customers in the U.S., and many of the world’s most prominent corporate, institutional and government clients globally.
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