UAE leads Middle East private capital market as investor confidence surges
Sovereign wealth funds allocate 43% of investments to private capital
Dubai: The UAE has emerged as the leading private capital market in the Middle East, driven by economic transformation programmes, rising infrastructure investment and increasingly sophisticated investment institutions, according to a new report from BlackRock’s Aladdin technology platform.
The report, titled 'Markets in Motion: Middle East', highlights a strategic shift across the region from being primarily an exporter of capital to global private markets to becoming an increasingly attractive destination for private capital investment at home.
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The study found that Middle Eastern sovereign wealth funds allocate 43 per cent of their investments to private capital, compared with 35 per cent among their global counterparts, reflecting growing appetite for the asset class.
Investor confidence in the region has also strengthened sharply. The proportion of Middle Eastern limited partners with a positive outlook towards private equity mandates rose to 83 per cent in 2026 from 70 per cent in 2019. Globally, the figure edged up to 61 per cent from 60 per cent over the same period.
Family offices drive investment
Family offices account for about half of active private capital investors in the Middle East in 2026, according to the report.
Private equity represents 27 per cent of their future investment intentions, followed by real estate at 19 per cent, private credit at 16 per cent, infrastructure at 14 per cent, hedge funds at 13 per cent and natural resources at 11 per cent.
Ayman Daif, Managing Director and Head of Aladdin Business Development for the Middle East, Central Asia, Africa and India, said the region was undergoing a structural transformation as more capital was deployed domestically and supporting investment ecosystems continued to develop.
He said the next phase would be shaped by greater collaboration between sovereign wealth funds, family offices and investment managers, alongside wider adoption of technology.
Gulf investment could reach $2.1 trillion
Daif cited BlackRock Investment Institute research projecting that Gulf Cooperation Council countries could deploy about $2.1 trillion by 2030, with investment focused on strengthening economic resilience amid disruptions to global trade and energy markets.
The Middle East's venture capital market has also shown resilience. The average total value of deals remained steady at $2.4 billion a year between 2021 and 2025, despite a more challenging funding environment in the United States and Europe.
The report said technology and infrastructure were among the sectors offering an expanding range of private market opportunities as governments across the region pursue economic diversification and attract greater levels of domestic and international capital.
