ILPA Issues Guidance on Private Equity Vehicle Fees
Institutional investors should watch for fee shifts when managers extend their hold on assets through continuation vehicles.
Updated on Oct. 26, 2026 in Investing
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The Institutional Limited Partners Association (ILPA) has released new guidance to standardize how investors navigate continuation vehicles in private equity. These structures allow managers to extend hold times on assets, potentially altering fee arrangements for institutional investors.
Why it matters
Continuation vehicles can shift investors from low- or no-fee co-investment terms into arrangements with higher fees and carry costs. ILPA's recommendations aim to bring transparency to these deals, ensuring investors receive fair pricing and adequate time to evaluate their participation.
The global private equity secondary market surged to $226 billion in 2025, a 41% increase over the previous year. ILPA now recommends that institutional investors be granted at least 20 business days to evaluate continuation vehicle opportunities.
The players
Institutional Limited Partners Association (ILPA)
An industry body representing over 600 institutional investors that provides advocacy and standardized best practices for private equity markets.
The details
Continuation vehicles allow private equity managers to extend their control over assets, which often requires limited partners to decide whether to cash out or roll their interest into the new entity. When investors transition into these vehicles, they may lose prior low-fee benefits, facing new full-fee and carry cost structures. ILPA recommends independent price validation and early engagement with limited partner advisory committees to protect investor interests during these transitions.
Timeline
Total secondary market volume reached $226 billion during 2025.
ILPA released its new guidance for continuation vehicles in October 2026.
Money Landscape
The rise of continuation vehicles reflects a shift in how private equity managers handle asset lifecycles as secondary market activity hits record levels. This guidance attempts to align governance with the 41% growth seen in 2025, addressing concerns about potential fee creep for long-term investors.
Investors currently involved in private equity should review their existing co-investment agreements to see if they specifically address continuation vehicle participation. If presented with a roll-over offer, check for changes in fee structures and request at least 20 business days to consult with your financial professional.
The takeaway
The move to standardize continuation vehicle deals signals a need for greater scrutiny of management fees when private equity assets are extended. Investors should prioritize transparency regarding carry costs and verify that any price validation provided for these assets is truly independent.
Further reading
For more on managing private market holdings, visit our guide on Investing.
Source note: This article includes information reported by Pitchbook.
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Should private equity firms be required to maintain fee protections when assets move to new vehicles?
