Mercer analysis of 150 transactions finds pricing discipline holds as continuation vehicles go mainstream
The private markets secondaries sector has evolved from a niche liquidity tool into a mainstream portfolio management strategy, according to new research from Mercer that could have significant implications for financial advisors navigating clients' private markets exposure.
Global secondary transaction volume hit $226 billion in 2025, up 41% year-on-year, as constrained exit markets and longer private company holding periods pushed more investors toward continuation vehicles as an alternative to traditional exits.
"Continuation vehicles are evolving into a durable, institutionalized segment of the private markets ecosystem, with last year's transaction volume growing by 41%," said Benjamin Baumann, Mercer's global head of secondaries. "As investment in private markets grows, companies stay private for longer, and investors become more sophisticated, the demand for liquidity solutions is increasing in tandem."
For advisors with clients holding private equity positions, the research offers a useful reality check on how these structures actually work in practice.
Drawing on roughly 150 transactions from 2021 to 2025, Mercer found that pricing in GP-led deals has been more disciplined than critics suggest. Around 59% of transactions closed at a discount to net asset value and 40% at par, with just 1% priced at a premium and an average settlement discount of around 8%.
Fee structure predictability
Management fees across the sample averaged 0.85%, with most falling between 0.75% and 1%. Tiered carry arrangements dominated, with 20% the most common maximum carry level — a standardization trend that gives investors a clearer basis for comparing deals.
One area the report flags as frequently misunderstood is deferred consideration. Around 15% of deals included provisions that delayed part of the purchase price, which can flatter reported returns while shifting economic risk in ways that headline figures obscure. Mercer argues that total deal economics, not just the discount to NAV, should drive any assessment.
Alignment between fund managers and investors also warrants scrutiny. Average GP commitment to continuation vehicles ranged from 6% to 10%, higher than in primary fund structures, though Mercer cautions that the percentage alone is not the whole story. Whether managers are rolling all their active equity or taking money off the table matters as much as the headline commitment figure.
"GP-led secondaries can play a useful role in private markets portfolios, particularly for investors seeking exposure to high-quality assets, shorter duration profiles or targeted access to high-conviction companies," Baumann said. "However, continuation vehicles must be assessed holistically, on total deal economics, total portfolio risk and asset and manager quality."
