Debtwire, in partnership with, Cortland Capital Market Services LLC, has produced the 11^th annual 2016 North American Distressed Debt Market Outlook, surveying 100 US-based hedge fund managers, distressed debt investors and private equity professionals on their expectations for the North American distressed debt market in 2016 and beyond. This year, US and international economic outlooks (including the price of oil), financial reform and the upcoming political election are the primary catalysts for distressed debt decision making in 2016.

Despite the bleak returns from the distressed investing space in 2015, a 53% majority of respondents to our survey insist they are willing to allocate more capital next year, hoping to take advantage of a market rebound. Comparatively, just 19% of respondents said they intended to allocate more to distressed investments in 2015’s Outlook. The sectors that generated the most interest from respondents for deploying capital in 2016 include financial services (51%), energy (50%) and industrials (47%). Next in line were the consumer/retail and pharma, medical and biotech sectors, which generated interest from 27% of respondents each. Financial services firms, a regular top pick among distressed investors, face challenges that could lead to distress due to changing political and regulatory pressures, several respondents noted.