September 12, 2025
Robert A. Stanger & Company, Inc., (“Stanger”) a nationally recognized leader in non-listed alternative investment products, today announced that the alternative investment industry is on pace to surpass $1 trillion of cumulative capital formation in the twenty-five years ending in the fourth quarter of 2025.
Total capital formation across major categories is projected to reach $1 trillion in the twenty-five years ending in the fourth quarter of 2025, estimated as follows:
- Real Estate: $348.1 Billion
- Closed-End Funds: $307.5 Billion
- Business Development Companies (“BDCs”): $235.0 Billion
- Other Strategies: $113.6 Billion
- Total: $1 Trillion
“Crossing the trillion-dollar threshold is more than a number – it is a defining moment for alternatives,” said Kevin T. Gannon, Chairman and CEO of Stanger. “What was once a niche segment of the market is now a central component of investor portfolios. Real estate remains a cornerstone, but closed-end funds and BDCs are surging, reflecting strong demand for private credit and private equity strategies.”
The pace of growth has been fueled by a combination of investor demand for yield, diversification, and access to private markets. Institutional-quality products that once were limited to pension funds and endowments are now increasingly available through structures designed for individual investors.
At the same time, a favorable regulatory backdrop and product evolution are making alternatives more accessible to regular investors. Features such as regular NAV reporting, improved liquidity, and access to institutional-quality managers are reshaping the investor experience. As these products gain traction, they are driving higher inflows while opening the door for additional product sponsors to meet rising demand.
“Investors are voting with their capital, and the message is clear: alternatives are here to stay. As structures evolve and access broadens, we see this market not just maintaining momentum but accelerating into its next phase of growth.” said Michael S. Covello, Executive Managing Director of Stanger.
In fact, Stanger’s data shows that alternative investment fundraising has increased dramatically in the past five years, with BDCs and Closed-End Fund structures capturing the fastest growth rates. This acceleration highlights not only the depth of investor demand but also the industry’s ability to innovate and adapt to shifting market conditions.
“The trillion-dollar milestone is not the finish line—it is the starting point for the next era of expansion,” Gannon added. “I expect the next $1 Trillion will be raised in Alternative Investment Products over the next five years.”
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About Robert A. Stanger & Co., Inc.
Robert A. Stanger & Co., Inc., founded in 1978, is a nationally recognized investment banking firm specializing in providing investment banking, financial advisory, fairness opinion and asset and securities valuation services to partnerships, real estate investment trusts and real estate advisory and management companies in support of strategic planning, capital formation and financings, mergers, acquisitions, reorganizations, and consolidations.
Stanger is also well known for its industry leading publications: The Stanger Report, a nationally recognized comprehensive report focused on non-traded REIT and BDC investing, including aggregate market statistics, total returns by company and total return indices, fee structure comparisons, and profiles of current offerings; The Stanger Market Pulse, a monthly deep-dive into alternative investment fundraising; The Stanger Chairman’s Report, focused on NAV REIT and non-traded BDC sales and redemptions; The Stanger Closed-End Fund Report, focused on non-traded interval fund and tender offer fund investing, Stanger Privates, a quarterly publication focused on Private Placement REITs and BDCs exclusively available to Stanger Institutional Access subscribers; and The Alt Street Journal, a weekly newsletter providing an update on industry activities.
For More Information:
Kevin T. Gannon | Chairman & CEO | (732) 389-3600
Robert A. Stanger & Co., Inc.
1129 Broad Street, Suite 201
Shrewsbury, NJ 07702
www.rastanger.com
Member: SIPC
