Private equity management fees have hit a 20-year low, according to the latest private capital terms report from Preqin. Buyout funds closed this year or in the market as of June agreed to average management fees of 1.74 percent of committed capital, down from 1.85 percent in 2023 and continuing their steady retreat from the traditional “2 and 20” model.
Fewer exits have meant reduced distributions to limited partners, in turn leading to less capital availability for new fund commitments.