Key takeaways and predictions from Torys 2026 secondaries summit

Players from across the secondaries industry spectrum gathered last week at the third annual Torys secondaries summit in Toronto to unpack what continues to drive secondaries activity and where the market is headed next.

The summit featured an exceptional roster of leading voices from both the GP-led and LP-led sides of the industry:

• Tori Buffery, Principal, Neuberger
• Thomas Choi, Managing Director, AltEx Capital
• Rob McGrath, Managing Director, Overbay Capital Partners
• Dominic Owen, Director, Private Equity, Northleaf Capital Partners

Here are some of the key takeaways from a timely and thought-provoking conversation and predictions on what’s to come in the latter half of 2026.

What you need to know

• The market balance between LP- and GP-led secondaries is expected to remain. Fairness opinions can serve as a useful check on the sell-side, but buyers look to form their own views. ’40 Act funds are becoming more common but are not the threat some suggest.
• Sponsor sellers need to focus on selling quality assets to move net asset value (NAV) and drive distributions. Secondaries remain attractive as investments in businesses with pre-existing track records. Buyers need to understand the true motivation of sellers in today’s environment of delayed exits.
• Another strong year is expected for secondaries in 2026. The impact of higher energy costs is significant and needs a sharp focus. The gap between top-tier and lower-tier assets will widen.
• An increase in IPOs could unlock a great deal of value on the venture side. A catalyst is needed to ease the liquidity squeeze in private equity.

Market balance

Panelists do not expect the current balance between LP- and GP-led secondaries to shift substantially (with LP-led aggregate deal value continuing to slightly outstrip GP-led aggregate deal value). Overall, the panelists noted their perspective that it has been a slower start to secondaries activity in 2026 relative to last year, but consistent with the trend in past years, a pickup is expected through the remainder of the year in respect of both LP- and GP-led deal activity.

Fairness opinions and ’40 Act funds

Fairness opinions are typically considered to be a fixture in continuation vehicle (CV) transactions, but concerns persist that they rely exclusively on sponsor-provided information without independent verification. Panelists also noted that only certain stakeholders may receive them (i.e., LPAC members in the selling fund(s)), so there is a disparity of information among transaction participants. Ultimately, it was observed that while fairness opinions may be given less weight in terms of providing a basis for pricing, they can serve as a useful check for the LPAC approving the conflict transaction on the sell-side. On the buy-side, buyers often do not receive (or see much value to) these fairness opinions and typically look to form their own views on value and assess the true motivations of the GP acting as seller.

Another notable feature of the secondaries market is the continued prevalence of ’40 Act funds. The panelists are continuing to see more of these evergreen funds, and note that their lower cost of capital is likely impacting pricing in LP-led secondaries markets in particular. However, some of the panelists shared their view that evergreen funds are not the threat some suggest, and that there are many opportunities in both the GP-led and LP-led markets where traditional secondaries investors have an edge.

Pricing and GP motivations

When it comes to pricing, panelists said that sponsor sellers have to focus on selling quality assets to move NAV and drive distributions. It was observed that private equity valuation multiples are high, and this is an ongoing challenge for the industry in navigating the bid-ask spread. GPs may need to lower their expectations on multiples in order to spur the velocity of exits and distributions.

From the perspective of investors looking to participate in CV transactions, it was stressed that price is key in landing the opportunity to act as the lead investor (particularly from the GP’s perspective as a fiduciary) – but panelists also commented on the importance of the strength of the broader relationship and the allure of stapled commitments to other funds of the GP as other important differentiators. Some panelists are also seeing a trend toward tighter syndicates, compounding the competitive landscape for these transactions.

Buying a house you already live in

For all of the evolution in the market, panelists emphasized that one of the most attractive aspects of secondaries remains the same—it is an investment in a business (or collection of businesses) with a pre-existing track record. Investors can see how the business has been run under current management, and this is a critical piece of due diligence in respect of any buy-side process. One panelist compared a secondaries investment to buying a house that you already live in.

That said, it was observed that investors must develop an understanding of the true motivations of a GP with a single-asset CV opportunity in today’s environment of delayed exits. The GP may see the asset as their best one and want more time with it – or it may ultimately be a troubled asset that shouldn’t trade at the CV multiple. Discipline in pricing and diligence were cited as the primary ways to avoid overpaying and separate high-conviction opportunities from assets that may be better left alone.

Predictions

When asked what to expect for the remainder of 2026, panel members offered the following predictions:

• The secondaries market will ultimately see another strong year in 2026.
• Market participants need to sharpen their focus on the energy crisis—precipitated by geopolitical developments as well as the growth of AI—to the extent not already top of mind. The cost of energy is having a direct impact on underlying portfolio companies—and the impact of higher energy costs on supply chains and input costs is significant.
• The bifurcation between top-tier and lower-tier assets will widen. For less attractive assets, the pressure to sell and deliver distributions to paid-in capital will intensify.
• If the SpaceX IPO is successful, others may follow. An increase in IPOs could unlock a great deal of value on the venture side in particular and lead to an increase in distribution activity.
• A catalyst is needed to ease the liquidity squeeze in private equity. There are 32,000 unrealized portfolio companies in the market and their capital needs to move. Since PE exits are moving slowly, panelists expect more innovation in the secondaries market in the latter half of 2026 and beyond to continue to help ease this pressure.