Symptoms

Designtime Performance - K2 Designer > Design time > User / Group searches perform bad on large AAD/SP structures
 

Diagnoses

At the moment this is by design, when you search for users you need to query the underlying providers, ie AAD and SP in your case. We cannot use the K2 cache because only users that has interacted with K2 will be in the cache and to assign permissions etc one will not want to be limited to these users and therefor need to go to the providers.

BUT there is light at the end of the tunnel. We have been working on an Identity ?vNext?, in this version K2 will cache all the provider data from the get go and all K2 queries can then use the K2 identity cache which will be much faster that querying a Provider. This will ultimately solve the issue you have when searching for users within the designer.
 

Resolution

By Design, new Identity service is expected to ship in the next Major Release of K2.