The changing landscape of private market structures
Luxembourg's private markets ecosystem reflects a broader evolution taking place across the asset and wealth management industry. Over the last decade, the number of structures has increased significantly, illustrating how investment platforms have become larger, more sophisticated and operationally more intensive.
While SPVs continue to perform their traditional role within investment structures, the environment in which they operate has become considerably more demanding. Modern private market strategies increasingly involve interconnected networks of holding companies, financing vehicles and SPVs across multiple jurisdictions, creating new challenges around governance, reporting and compliance across a broader operational ecosystem.
This growing interconnectedness means asset managers are managing far more than individual entities. They are coordinating structures where decisions taken in one jurisdiction can have implications across several others, fundamentally changing the nature of SPV management.
Activity has instead shifted towards the existing population of vehicles, with asset managers reviewing their arrangements with incumbent service providers in growing numbers. Indeed, the market for migrating existing SPVs to a new service provider is unusually active, and for the latter, this reshapes where the commercial opportunity lies, placing a premium on the ability to onboard and migrate structures smoothly.
Four pressures testing existing operating models
For many years, operating models evolved alongside business growth. As asset managers expanded into new markets, launched new funds and established increasingly sophisticated structures, operational capabilities generally grew through additional capacity, local expertise and incremental process improvements. Today, however, the operating environment is fundamentally different.
Asset managers are increasingly facing pressure across four dimensions: entity growth, regulatory expectations, investor expectations and scalability constraints. Larger and more interconnected SPV ecosystems require greater coordination and oversight, while evolving regulatory requirements, rising expectations around transparency and reporting, and ongoing resource pressures are making operating models harder to sustain at scale.
Thus, operational demands are increasing exponentially rather than incrementally. Sustainable growth therefore depends on operating models that can absorb additional scale without requiring a proportional increase in resources, while maintaining consistent service quality and a cost-effective delivery model.
Key priorities for asset managers
Managing cross-border SPV structures
Explore our perspective on the operational, governance and delivery considerations shaping cross-border SPV management.
