Introduction
Private credit has emerged as a dynamic asset class, offering alternative investment opportunities beyond traditional equity and bond markets. As of 2023, the global private credit market is valued at approximately $1.5 trillion, and analysts project it to reach $2.5 trillion by 2028, driven by investor demand for higher yields and diversification. Certain global hubs have established themselves as key centres for private credit, attracting investors, fund managers, and borrowers.
This article explores the leading private credit hubs worldwide, backed by statistics that highlight their prominence and unique opportunities.
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New York: The Financial Powerhouse
New York leads the way in private credit, supported by its dominant position in global finance. The United States accounts for nearly 55% of the global private credit market, making New York the natural hub for fund managers and institutional investors.
In 2022, U.S. middle-market lending surpassed $100 billion, with sectors like healthcare, technology, and real estate leading the charge. The city’s robust secondary markets and favourable legal frameworks make it an attractive destination for private credit investments.
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London: The Gateway to Europe
London remains a pivotal hub for private credit in Europe, managing over €300 billion in private debt assets as of 2023. The UK accounts for approximately 35% of Europe’s private credit activity, fuelled by its sophisticated investor base and robust financial infrastructure.
Since Brexit, London has adapted to maintain its status as a global financial centre. European private credit funds raised €129 billion in 2022, with London-based managers playing a significant role in cross-border transactions targeting infrastructure, SMEs, and real estate.
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Singapore: The Asian Alternative Credit Hub
Singapore is the leading private credit hub in Asia-Pacific, where the market is projected to grow at a CAGR of 13% from 2023 to 2028. The region accounts for 12% of the global private credit market, with Singapore managing a significant portion of the $180 billion allocated to Asia.
In 2022, private credit in Asia focused heavily on trade finance, with $25 billion deployed in sectors such as logistics, real estate, and technology. Singapore’s strategic access to fast-growing economies like India, Indonesia, and Vietnam positions it as a gateway for investors seeking regional exposure.
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Dubai: The Middle East’s Private Credit Centre
Dubai is rapidly emerging as the Middle East’s key private credit hub. The region’s private debt market, estimated at $40 billion, has grown steadily, driven by demand for infrastructure and real estate financing.
In 2022, private credit transactions in the Middle East rose by 25%, with Dubai accounting for a significant share. As a global bridge between East and West, Dubai attracts both international fund managers and regional family offices seeking alternative investment opportunities.
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Luxembourg: A European Stronghold
Luxembourg is home to over 3,500 investment funds, many of which specialise in private credit. In 2023, it managed approximately €80 billion in private debt assets, making it a vital hub for fund domiciliation and cross-border investments.
The Grand Duchy’s reputation for tax efficiency and legal clarity makes it a preferred choice for structuring private credit funds targeting European borrowers, particularly SMEs and real estate projects.
Conclusion
As private credit continues to grow as an asset class, these global hubs play a pivotal role in shaping its future. From New York’s financial might to Singapore’s regional influence, each location offers unique advantages for investors and fund managers alike. The geographical spread of direct lending, backed by impressive statistics, highlights the sector’s potential for diversification and growth.
At Kingsbury & Partners, we leverage our global network to connect clients with the best private credit opportunities. For tailored solutions and expert insights, explore our Insights page or contact us directly. Let us help you navigate the world of private credit with confidence.
