GP-led deals such as continuation funds came roaring back in the second half of last year, and this year inventory is high with the expectation that the secondaries market will be busy.

Pricing is part of the explanation behind the rise in GP-led deals, as is the need among GPs to find alternative paths to exit and liquidity for their assets in the slow exit environment. As well, several potential secondaries firms have closed funds in recent months and are well stocked with fresh capital to chase deals.

The hunt for liquidity is on everyone’s minds. M&A activity is on the upswing compared with last year, and exits are still slow, which means distributions are not coming in at the rate many LPs need to help maintain their private equity allocation pacing.

GPs and LPs are both exploring paths to liquidity and the secondaries market is one of those options. For GPs, continuation funds represent a way to deliver liquidity to LPs in older funds while hanging on to assets with more growth ahead.

Last week, KSL Capital reported closing one of the largest continuation funds, raising more than $3 billion for its ski resort holding company Alterra Mountain Co. That total includes secondaries capital as well as co-investments, sources have told affiliate title Buyouts. GIC was an investor in the process, Buyouts previously reported.

GP-led activity has grown on a foundation of steady activity on the LP side of the business, which has led secondaries volume for the past two years. LP portfolio sales are also expected to keep the market busy this year, sources have told me.

One such deal this year is from Washington State Investment Board, which is attempting to sell a portfolio of private equity fund stakes for the second time. Washington brought a portfolio to market in 2022 and pulled it after receiving low pricing.

This time around, the system, like many LPs, wants to take advantage of much stronger pricing. Recent volume surveys have shown pricing for buyouts funds in the range of 90-95 percent of net asset value.

It’s a potential window of opportunity that some LPs are looking to take advantage of before some other macro shock reverses recent positive economic developments, potentially weakening pricing.

Chris Witkowsky is editor of affiliate title Buyouts. Write to him at