Fund managers across Asia increased new fund launches in 2025 despite a challenging capital-raising environment, with open-ended offshore products rising 88% year over year, according to a new white paper from offshore law firm Walkers.
The report, which reviews activity in Hong Kong, Singapore, Japan, mainland China and the Middle East, found that fundraising in Asia outpaced global trends even as geopolitical tensions, shifting interest rates and volatile public markets weighed on sentiment.
Hong Kong accounted for 37% of the open-ended funds the firm worked on in the region, followed by Tokyo at 22% and Middle Eastern managers at 20%. Singapore represented 17% after what the report described as a particularly busy 2024. In the closed-ended market, the number of funds rose 20%, with Hong Kong taking a 33% share and the Middle East 30%.
Three-quarters of closed-ended funds launched in Asia targeted less than $500 million, mirroring 2024 levels. At the same time, timelines to final close shortened. In 2025, 67% of Asia-based private funds reached final close within 12 months, up from 59% a year earlier.
While fundraising windows narrowed, fund terms lengthened. The proportion of Asia-managed closed-ended funds with durations longer than 10 years rose to 27%, up from 10% in 2024. Evergreen structures also increased, accounting for nearly one-quarter of Asia launches in 2025.
Private credit was among the fastest-growing strategies. After representing 3% of closed-ended funds in 2024, private credit rose to 17% in 2025, according to the report. In the hedge fund space, credit strategies made up 24% of open-ended launches in Asia, rebounding from negligible levels the year before.
Managers also tightened liquidity terms. The share of Asia-launched funds using some form of lock-up increased to 63% in 2025 from 44% in 2024 , and 67% of funds included redemption gates.
Fee pressure continued. Average hedge fund management fees in Asia fell to 1.22% in 2025, below the global average of 1.43%, while performance fees remained more stable, with 57% of funds charging 20%. In closed-ended funds, the share charging carried interest below 20% rose to 44%.
The Cayman Islands remained the dominant offshore domicile for private funds globally, excluding the United States, holding about 68% market share based on Securities and Exchange Commission data cited in the report.
The firm said the data indicate that managers and investors in Asia are adapting to prolonged uncertainty rather than retreating, though longer fund terms, tighter liquidity and lower fees suggest continued caution heading into 2026.
