Private equity (PE) investment in Southeast Asia declined sharply in the second quarter of 2026, as investors remained selective amid geopolitical uncertainty and a subdued dealmaking environment, according to EY-Parthenon.
The region recorded 10 private equity deals worth $935.5 million during the quarter, compared with 19 deals totaling $9.2 billion in the first quarter, EY-Parthenon’s Southeast Asia Private Equity Pulse for Q2 2026 report showed.
On a year-on-year basis, deal volume fell 55%, while aggregate deal value declined 58%.
Capital deployment was concentrated in mid-market transactions. Only one investment exceeded $500 million, while no transaction crossed the $1 billion mark.
Real estate accounted for 90.8% of total investment value, largely due to an $850 million equity injection into Singapore-based ESR Group by existing shareholders Warburg Pincus and Sixth Street.
Technology represented 5.3% of quarterly deal value, while the consumer sector accounted for 2.2%.
Other notable investments included Apis Partners’ $50 million investment in Singapore-based human resources technology company BIPO Service Singapore and a $20.5 million investment in Little Farms Group by Asia Partners Fund Management and Panther Mountain Capital.
Despite weaker investment activity, Southeast Asia recorded its strongest exit conditions since the first quarter of 2022.
Eleven exits generated $4.2 billion in proceeds, with aggregate exit value more than tripling from a year earlier even as exit volume remained unchanged.
The largest exit involved Cuscaden Peak Investments, an indirect wholly owned subsidiary of Temasek Holdings, selling Singapore’s Paragon property for $3.03 billion.
Blackstone’s $900 million exit from Interplex Datacom ranked second, followed by Dymon Asia Private Equity’s $136.8 million exit from industrial company Newark.
Fundraising remained muted, with only one private debt fund closing at $320 million during the quarter.
EY-Parthenon ASEAN Private Equity Leader Luke Pais said stronger exit activity was an encouraging sign for capital recycling and could support a more constructive outlook for private equity sponsors in the coming quarters.
