The private equity industry had a record high of $3.06 trillion in assets under management as of Dec. 31, up 20% from a year earlier, data from Preqin show.
This marks the highest annual growth rate ever recorded by Preqin since it began tracking this data in 2000.
Dry powder crossed the $1 trillion mark to $1.03 trillion as of Dec. 31, up 24% from the year before. The unrealized value of invested assets held by fund managers also grew by 18% over the course of 2017, to $2.04 trillion as of Dec. 31, according to Preqin.
This comes as private equity fund managers distributed $466 billion to investors, representing the seventh consecutive year in which fund managers have returned more capital to investors than they have raised. Managers collected a record $430 billion from investors in 2017. They distributed a record $516 billion in 2016.
In a news release accompanying the report, Christopher Elvin, Preqin's head of private equity products, attributed the "prodigious growth" in AUM "purely to dry powder … off the back of several record-breaking funds coming to market and holding closes."
Mr. Elvin did note, however, that "it is equally significant that the unrealized value of invested assets held by fund managers rose by a similar proportion and grew beyond $2 trillion for the first time."
The Preqin executive said the private equity "industry has managed to post record growth even as it returns significant levels of capital back to investors. 2017 did not quite match the record levels of distributions seen in 2016, but nonetheless approached half a trillion dollars for the year. Although the net flow of capital was low overall compared to recent years, this is because fund managers called up a record amount from investors," which Mr. Elvin calls "an encouraging sign."