Limited partners are pivoting toward continuation vehicles while expressing skepticism about LP-led secondaries, marking a notable shift in private markets sentiment. Investors increasingly favor maintaining exposure to quality assets rather than pursuing exits in volatile conditions.

Florida State Board of Administration and Sweden's Alecta recently voiced caution about LP-led secondary returns, reflecting broader concerns over valuation discipline and deal economics. Their wariness highlights mounting questions about whether secondary buyers can deliver adequate returns in the current environment.

Single-asset continuation funds are drawing particular interest as LPs seek targeted exposure to proven performers. This preference suggests investors trust GPs' ability to identify assets worth holding beyond their original fund life cycles.

The trend signals capital flow redirection that could reshape secondary market dynamics. GPs may increasingly favor CV structures to meet investor demand while avoiding forced asset sales at potentially distressed valuations.