Goldman Sachs Alternatives Survey: “Rethinking, Not Retreating” Finds LPs Hold Steady on Private Markets as Distributions Lag

Most LPs (84%) plan to maintain or raise deployment activity but are more selective about strategies and managers.

Lack of distributions is the top constraint for capital deployment, cited by more LPs than last year.

Geopolitics leads the risk list for a third straight year, and AI ranks as the biggest force reshaping alternatives.

NEW YORK, NY — October 22, 2026 — Limited partners (LPs) are keeping their private markets commitments but changing how they build them, according to a new survey from Goldman Sachs Alternatives. The 2026 Global Alternatives Survey: The LP View, “Rethinking, Not Retreating,” draws on 225 LPs and other institutional investors surveyed between June and August 2026. Respondents are leaning on secondaries to manage liquidity, concentrating capital with existing managers, and setting a higher bar for new ones.

Over one-third of LPs (37%) expect to deploy more capital than last year, and close to half (47%) plan to hold their pace; only 11% expect to deploy less. The constraint is liquidity: lack of distributions is the most-cited factor shaping deployment plans, named by 35% of LPs.

“Our clients remain disciplined in this dynamic risk environment,” said Marc Nachmann, Global Head of Asset & Wealth Management, Goldman Sachs. “LPs are not retreating, they are rethinking where to deploy capital, with whom, and on what terms. Their confidence in private markets remains intact, but they are taking a more selective approach, focusing on managers who can deliver value creation to achieve target returns.”

Geopolitics Tops the Risk List for a Third Consecutive Year

For the third consecutive year, LPs rank geopolitical tensions as the greatest investment risk. Geopolitics appears in the top five for 82% of LPs and is by far the most often cited (36%) as the single greatest risk. Inflation ranks second among the top five (67%), followed by a US economic slowdown or recession (63%).

Investors in Europe, the Middle East, and Africa (EMEA) worry most about geopolitics: 44% rank it first, compared with 31% in Asia-Pacific (APAC) and 30% in the Americas. Artificial Intelligence (AI) is starting to register as a risk: 28% of LPs put technology-driven workforce displacement in their top five, and most respondents who selected “other” cited AI-related concerns.

Jeff Fine, Global Co-Head of Alternatives Capital Formation, Goldman Sachs Alternatives, said, "Geopolitical tensions and elevated rates have slowed traditional exits, but the race to power AI infrastructure is creating the most consequential deployment window of the decade. Those tensions are top of mind for LPs as they plan capital allocation and manager selection."

Infrastructure and Secondaries Lead a Resilient Outlook

Most LPs see the opportunity set as equal to or better than a year ago:

• Infrastructure: 43% report a more favorable outlook; 7% a less favorable one.
• Secondaries: An increase in positive views now outnumber negative by nearly 3 to 1 (44% vs. 15%).
• Co-investments: Only 6% report a weaker outlook.
• Real estate: 37% report an improved outlook, 16% a less favorable one.
• Private equity: Stable sentiment prevails as 56% report no change in outlook; positive and negative views are split roughly evenly at 24% and 20%.
• Private credit: The largest year-over-year rise in negative sentiment at 35%, yet 65% continue to see opportunities as the same or better.
• Hedge funds: Interest is rising, with 34% reporting a more favorable outlook and fewer than one in ten less favorable.
• General partner (GP) stakes: Most LPs (69%) report no change in their view of GP stakes.

Steady Intent and Room to Run, but Slow Distributions Set the Limit

LPs remain more likely to be under-allocated than over-allocated across private markets. Private credit under-allocation rose 5% year over year, while over-allocation fell to 4% from 12%. Real estate sits furthest along the allocation cycle, with the largest over-allocated cohort (18%), though that share fell from 25% a year ago.

LPs under-allocated	2024	2025	2026
Private credit	54%	43%	56%
Infrastructure	42%	45%	49%
Private equity	35%	35%	37%
Real estate	31%	26%	36%

Source: Goldman Sachs Alternatives, Private Markets Diagnostic Survey (2024-2025) and Global Alternative Survey: The LP View (2026). LP respondents only.

Overall, 84% of LPs plan to deploy the same or more capital than last year, in line with 83% in 2025. Within that, fewer expect to increase (37%, from 43%).  Fewer also expect to cut back (11%, from 14%).

Lack of distributions is the top-ranked factor affecting deployment plans (35%, up from 31% in 2025), ahead of changes to allocation targets (29%). Only 2% cite regulatory and tax concerns.

“Liquidity has become a competitive edge as time to exit has extended,” said Stephanie Rader, Global Co-Head of Alternatives Capital Formation, Goldman Sachs Alternatives. “LPs are increasingly using secondaries as a core tool for portfolio allocation and managing cash flows to build more resilient portfolios.”

Each Asset Class Faces a Different Pressure Point

Asked to name the single biggest challenge in each part of their book, LPs pointed to different problems. Liquidity leads in private equity (28%), performance in real estate (32%), access in co-investments (21%), and manager selection in private credit (20%) and infrastructure (15%). Valuations rank second in three of the five asset classes, the closest thing to a shared concern.

Open-ended question analysis revealed that reassessment is happening within each asset class. In private equity, some LPs are consolidating GP rosters while others are moving toward emerging managers or the lower middle market. In private credit, many are branching beyond direct lending into secondaries, new geographies, and evergreen structures. In real estate, several are moving up the risk curve into value-add and opportunistic strategies, and real estate debt is winning allocations as an alternative to private credit.

Regionally, some LPs are trimming US exposure to make room for Europe, the region most cited by investors increasing their international focus.

New Managers Face a High Bar, and LPs See AI Reshaping the Industry

Incumbent managers keep their edge: Most LPs report that a meaningful share of their commitments over the past 12 months were re-ups with existing GPs.

When LPs add new managers, track record matters most (78%). Beyond that, they want something their portfolio lacks: access to new strategies or asset classes (50%), specialist expertise (39%), and diversification across sectors or regions (35%).

LPs name AI as the greatest driver of change in alternatives over the next five years (34%), well ahead of industry consolidation and economic disruption (13% each). The question is shifting from gaining AI exposure to identifying managers who can use it to improve investment decisions and create value in portfolio companies. As one respondent put it, “As with any big technological shift, people are probably overestimating the short run and underestimating the long-run second- and third-order impacts.”

“New managers have to earn their allocations,” said Mike Brandmeyer, Global Head and Chief Investment Officer of the External Investing Group (XIG), Goldman Sachs Alternatives. “Track record is critical; but investors now want to see underwriting discipline, a clear edge over competitors, and a manager’s ability to adapt to structural shifts, especially those driven by AI.”

Methodology

The 2026 Global Alternatives Survey: The LP View captures the views of 225 limited partners and other institutional investors, surveyed between June and August 2026. Respondents include public and private pensions, insurance companies, endowments and foundations, investment consultants, sovereign wealth and official institutions, family offices, asset and wealth managers, corporate pensions, and retail platforms including registered investment advisers (RIAs). The sample splits 43% Americas, 40% EMEA, and 17% APAC. Twenty percent manage more than $100 billion. Year-over-year comparisons use LP responses from the 2024 and 2025 Private Markets Diagnostic Survey.

About Goldman Sachs Alternatives

Goldman Sachs (NYSE: GS) is one of the leading investors in alternatives globally, with over $706 billion in assets and more than 30 years of experience. The business invests in the full spectrum of alternatives including private equity, growth equity, venture capital, private credit, real estate, infrastructure, sustainability, and hedge funds. Clients access these solutions through direct strategies, customized partnerships, and open-architecture programs.

The business is driven by a focus on partnership and shared success with its clients, seeking to deliver long-term investment performance drawing on its global network and deep expertise across industries and markets.

The alternative investments platform is part of Goldman Sachs Asset Management, which delivers investment and advisory services across public and private markets for the world’s leading institutions, financial advisors and individuals. Goldman Sachs has approximately $4.1 trillion in assets under supervision globally as of September 30, 2026.