Investors' LPs are way more in the driver's seat than they were a few years ago,' CSC's Thijs van Ingen says, explaining why GPs are accommodating LPs' demands for bespoke structures, despite the cost – financial or otherwise.
Van Ingen notes that Special Purpose Vehicles (SPVs) have become increasingly popular as they allow LPs to gain more direct control over their investments. This shift represents a significant change from traditional fund structures, where GPs held majority decision-making power.
The rise in SPV usage reflects broader trends in private equity, where investors are seeking more transparency and customization. Despite potential costs to both parties, GPs are adapting to these demands as competition for quality deals intensifies and LPs become more selective about their partnerships.
This evolution in fund structures suggests a fundamental rebalancing of power dynamics in the private equity space, with institutional investors gaining unprecedented influence over investment decisions and portfolio management.
Source: Infrastructure Investor · Summarized by HeadlinesBriefing