Private Equity Sees Modest Gain in Q1 2010

For the quarter ended March 31, 2010, the State Street Private Equity Index posted a 2.22% return.

According to a press release, this was 372 basis points lower than the fourth quarter of 2009 return and 868 basis points higher than the return recorded during the year ago period.  The first quarter 2010 return for the European and Rest of World regions were -1.9% and 4%, respectively, with both reflecting a slight decrease from the prior quarter.  

For the second quarter 2009 to the first quarter of 2010, all Private Equity recorded a 22.7% one-year end-to-end return. The announcement said Mezzanine and Distressed Debt funds combined recorded 38.2% return for the same one-year investment time period, better than other investment strategies.   

The since inception Internal Rate of Return (IRR) as of March 31, 2010, was 11.5%, a slight increase from the prior quarter. Buyout funds and Venture Capital recorded 11.9% and 8.6%, respectively.  Distressed Debt and Mezzanine funds posted an 11.5% return since inception.  

The index is based on the latest quarterly statistics from State Street Investment Analytics’ Private EdgeGroup and includes 1,779 private equity partnerships with a total fund size of $1.6 trillion.