US-based Nuveen, the investment management arm of TIAA, has just released its “Fifth Annual EQuilibrium Global Institutional Investor Survey: Institutional Investors Broaden Their Reach in Private Market Allocations.”

A new report by Nuveen shows that globally 66 per cent of investors plan to increase their private asset allocations over the next five years while over 90 per cent now hold both private equity and private credit compared with 45 per cent in 2021.

Capturing the views of the large investors with participation of 800 institutions representing $19 trillion in assets under management, Nuveen’s EQuilibrium Global Institutional Investor Survey examines how evolving perspectives on market, geopolitical and climate-related issues are influencing asset allocation decisions.

“As institutions sharpen their focus on specialised real asset opportunities, the trend towards private market solutions continues to accelerate, reinforcing the role of real estate and infrastructure as core components of institutional portfolios,” Harriet Steel, global head of institutional at Nuveen, said. “Long-term growth opportunities are back in focus and investors are reassessing the attractive return potential and effective inflation hedges of real estate and infrastructure, amid lingering concerns over deficits, trade policy and structural inflation risks.” 

The report is yet another example of how wealth managers are talking about the desire to increase exposure to unlisted markets, seeing these as important ways to diversify exposures, reduce overall portfolio risks in the long-term, and capture important sources of return.

Private infrastructure and private real estate saw the biggest year-over-year increases in the percentage of investors globally planning to increase allocations from 35 per cent and 24 per cent respectively, in 2024 to 50 per cent and 37 per cent, respectively, in 2025. Further, investors are being selective in targeting specific high-growth areas within both markets, such as data centres and private infrastructure debt.

Data centres have emerged as a leading priority, with 65 per cent of investors planning to increase allocations to real estate focused on digital infrastructure, reflecting the rapid expansion of cloud computing and AI-driven demand, the firm said. Government initiatives aimed at modernisation and sustainability are increasing investor interest in infrastructure. Over 30 per cent of investors who are planning to increase private fixed income assets are looking at energy infrastructure credit, the survey shows.

Insurers based in EMEA indicated conviction in private real estate, with 46 per cent of this cohort planning to increase allocations over the next two years, compared with 27 per cent last year. 

Within Europe, the strongest interest is coming from German investors where more than half plan to increase allocations to private real estate compared with 24 per cent last year, the firm said.

Private markets powering portfolio construction
Nuveen highlighted that institutional investors are continuing to deepen their commitment to private markets, with 66 per cent planning to increase allocations to private assets over the next five years. More than 90 per cent now hold both private equity and private credit, a sharp rise from 45 per cent in 2021, underscoring the expanding role of private markets in institutional portfolios.

The report also shows that 71 per cent of UK investors are planning to increase their allocations to private markets, with 52 per cent increasing allocations to private credit.

“Private market flows remain resilient, with funding sourced from public asset outflows, cash reserves, and new capital,” Steel said. “Even those adjusting allocations within private markets are largely reallocating rather than exiting.”

Private infrastructure, credit and equity continue to attract attention, with nearly half of investors planning to expand allocations to these areas. Within these categories, investors indicated that private equity is where they plan to make the greatest increase, the survey shows.

A trend towards higher-yield, higher-risk fixed income is also emerging, with private fixed income now a leading focus. Nearly half of respondents are exploring new niche areas within private credit, such as energy infrastructure credit and fund finance.  

As allocations to alternatives grow, nearly 40 per cent of institutions are expanding their roster of asset managers to navigate increasing complexity and specialisation.

Investors with higher allocations to alternatives are more likely to have dedicated investment teams, signalling a shift towards increasingly sophisticated decision-making in private market investments.

Insurers lean into private markets and impactiInvesting
Insurers are shifting towards strategic growth and specialisation. While geopolitical risks and market volatility remain on their radar, insurers are expressing less concern over economic growth and recession risks in 2025 than they did in 2024, the firm said.

This confidence is reflected in their foresight and early moves in reformulating their capital market assumptions, with only 27 per cent are adjusting their methodologies due to shifting fundamentals this year – down from more than half in each of the past two years.

As insurers look beyond short-term risks, private market allocations continue to expand, with 69 per cent planning increases over the next five years. There is particular interest in private credit, with insurers boosting allocations to private real estate debt (45 per cent) but also broadening their exposure to niche opportunities, including energy infrastructure credit (46 per cent), private asset-backed securities (34 per cent) and fund finance (26 per cent). These shifts underscore a growing appetite for complexity and yield-enhancing strategies within insurance portfolios.

Insurers are also evolving their approach to responsible investing, placing greater emphasis on positive impact metrics and benchmarking to the United Nations’ Sustainable Development Goals. Currently, 93 per cent either incorporate or plan to incorporate environmental and social impact factors into their investment strategies – signalling a continuing evolution towards measurable, outcome-driven approaches. Over half report managing a separate sleeve in their portfolio for impact investments, compared with 26 per cent in the firm’s 2023 survey.

Investors are also adopting a more balanced and pragmatic view of the energy transition, with 73 per cent of respondents agreeing that near-term energy needs cannot be met without incorporating both traditional and renewable energy sources.

“We are seeing a shift towards strategies that combine the practicalities of current energy needs with the ambitions of a sustainable future,” Steel said.

While fewer investors now view the low-carbon transition as inevitable – 61 per cent compared with 79 per cent in 2022 – the commitment to clean energy remains strong, with most institutions prioritising clean energy and carbon reduction either as part of net zero goals or to capture compelling risk-return opportunities.

Overall, 44 per cent of institutions have net zero commitments while another 25 per cent plan to in the coming 12 months.

While 45 per cent of institutions identify nature loss as a top five economic risk, only three in 10 are increasing their focus on nature-related themes within their portfolios, the survey reveals. This likely reflects the fact that nature-related investing is still a developing area, with many allocators in the process of educating themselves and building their understanding.

Among those prioritising nature-based investments, 79 per cent are seeking strategies that go beyond sustainability to proactively mitigate environmental degradation. Sectors such as water and waste management, pollution reduction and recycling are emerging as key opportunities, offering a dual benefit of environmental risk mitigation and attractive return potential.

Nuveen has $1.3 trillion in assets under management, with operations in 32 countries.