Private Markets Adoption Has Broadened but Now Comes the Hard Part

The first wave of private markets adoption in the wealth channel was largely about access — getting products onto platforms, educating advisors on the basics, and convincing skeptical clients that alternatives belonged in their portfolios. That wave has largely crested.

Now, with public equity markets near all-time highs and private markets embedded across a growing share of client portfolios, the harder questions are taking center stage: How do you fund new private allocations without disrupting what’s already working? How do you coordinate liquidity across a mixed public-private portfolio? And how do you identify which clients are actually positioned to benefit — versus which ones will regret the decision the first time they can’t get their money out?

Brian Griggs, head of Portfolio Strategy Group at Nuveen, works daily with RIAs, wealth managers, and family offices navigating exactly those questions. Griggs elaborated on how advisors are approaching private markets allocation in a maturing implementation environment, and what separates the firms getting it right from those that are learning expensive lessons.

CM: You’ve described the current moment as a maturing phase for private markets adoption. What does maturation look like in practice — how has the conversation with advisors changed from two or three years ago?

BG: The biggest change is that advisors are no longer treating private markets as a simple add-on to a traditional stock-and-bond portfolio. A few years ago, the conversation was often about whether a specific client should add private exposure to seek incremental return. Today, the conversations focus on portfolio design: what role the allocation should play, where the capital should come from, how it changes liquidity, and whether it improves the client’s after-tax, risk-adjusted outcome. For example, advisors are increasingly focused on how private real estate, infrastructure, farmland, and direct lending can help generate stable cash flow, improve inflation resilience, and support real after-tax returns.

That shift requires a more unified risk framework across public and private assets. Advisors need to evaluate not only expected return, but also liquidity terms, valuation methodology, tax treatment, correlation, and the client’s ability to stay invested through a full cycle. Portfolio analysis tools like Nuveen’s nSights platform can help advisors evaluate private markets allocations alongside the rest of the portfolio, rather than in isolation. Education remains critical, because successful implementation often depends less on access itself and more on whether the allocation is properly sized, funded, and explained.

CM: You’ve said the key challenge now is not availability but suitability. How do you help advisors think about client segmentation — which clients are genuinely positioned to benefit from private markets and which ones aren’t?

BG: Private markets are generally best suited for clients with stable liquidity needs, a long investment horizon, enough portfolio scale to diversify, and the ability to remain committed when pricing is less transparent or exits are not immediately available. As access has expanded, suitability has become more important, not less. Advisors need to match the strategy to the client’s objectives, cash-flow needs, tax profile, and tolerance for complexity.

CM: How are family offices approaching private markets differently than RIAs or traditional wealth managers?

BG: Family offices generally remain more focused on traditional drawdown fund structures or individual asset co-investment opportunities for private market exposure. RIAs, by contrast, have shown a stronger preference for evergreen strategies. That could evolve if the benefits of evergreen funds — lower minimums, built-in diversification, and easier implementation across model portfolios — become more important to the family office community.

CM: Private markets were sold heavily on the illiquidity premium thesis. With public fixed income yields now well above long-term medians, how are advisors re-evaluating that case for core real estate, direct lending, and other income-oriented private strategies?

BG: Higher public fixed income yields have raised the hurdle for private assets, but they have not eliminated the case for them. The argument is not that private markets are automatically superior to public bonds. It is that they can provide different sources of return, income, and diversification for investors who can tolerate less liquidity.

Direct lending can offer contractual income, floating-rate exposure, and access to parts of the credit market that are not fully represented in public fixed income. Core real estate can provide income, potential inflation sensitivity, and exposure to property fundamentals such as supply, demand, and replacement costs. Farmland and other natural capital strategies can add differentiated real asset exposure, with return drivers tied to land productivity, commodity demand, and long-term inflation dynamics.

The key is not to treat these allocations as interchangeable yield substitutes. Each private asset class plays a different role, and each should be evaluated in the context of the full portfolio, including liquidity needs, risk tolerance, tax considerations, and time horizon.

CM: Where is new private markets capital actually coming from in client portfolios right now — and which public allocations are advisors most willing to reduce to fund private exposure?

BG: The source of capital should start with the client objective, not a generic target allocation. If the private investment is intended to generate income, it may be funded from part of the fixed income sleeve. If the goal is long-term growth, the source may be equities. If the goal is inflation sensitivity or real asset diversification, the funding source may be more blended. The goal is not to displace traditional holdings wholesale. It is to build a more resilient portfolio that is less dependent on any single source of return, or on the traditional stock/bond relationship working in every environment.

CM: Are there private market asset classes you think are currently overcrowded with retail capital — where the entry point and competitive dynamics have changed enough to warrant more caution?

BG: A strategy attracting significant capital does not automatically mean it is no longer attractive. The more important question is whether investors are being adequately compensated for the risks they are taking. That is where manager selection and disciplined underwriting matter more than simply following capital flows. As access expands, advisor outcomes are increasingly driven by implementation: selecting the right managers, understanding underlying exposures, and ensuring each allocation complements the broader portfolio.

Private credit continues to see strong demand across its sub-sectors, but investors should consider how much aggregate credit exposure they already have across public fixed income, how they are sizing private credit positions, and which segment of the market they are accessing. In direct lending, especially in the middle market, there remains a meaningful gap between borrower demand and capital available from traditional lenders. That can create attractive opportunities, but only for managers with the sourcing, underwriting discipline, and selectivity to deploy capital well rather than simply chase volume.

At the same time, parts of private real estate may be becoming more compelling as new construction slows and income fundamentals continue to improve.

CM: How does the Nuveen nSights platform help advisors model how private assets actually interact with the rest of a client’s portfolio — and what do advisors typically discover when they run that analysis that surprises them?

BG: One of the biggest challenges with private markets is that traditional portfolio analytics often do not tell the full story. Because private assets are valued less frequently and often rely on appraisal-based pricing, historical returns can sometimes understate or obscure underlying portfolio risk. Nuveen’s nSights platform helps advisors move beyond backward-looking metrics by evaluating private and public holdings together within a unified portfolio framework.

Rather than looking at a private allocation in isolation, advisors can assess how it changes the portfolio’s overall risk, correlation, liquidity profile, and diversification. The nSights platform also helps identify overlapping exposures that may not be obvious when public and private assets are analyzed separately.

What often surprises advisors is that adding private exposure does not automatically improve diversification. In some cases, private and public holdings may share similar underlying economic exposures, meaning the portfolio is taking more concentrated risk than the headline allocation suggests. By making those relationships more transparent, nSights helps advisors build more intentional portfolios and have more informed conversations with clients about how private markets contribute to long-term investment outcomes.