Infra fundraising hits five-year high

Infrastructure fundraising is back to 2008 levels, new data from Infrastructure Investor Research & Analytics shows.

Unlisted infrastructure investment vehicles raised more capital last year than in any year since the beginning of the financial crisis, with $32.6 billion pooled in 2013 by institutional investors seeking exposure to the asset class.

“We’ve seen a recovery across the board for alternative asset fundraising but infrastructure stands alone in returning to 2008 levels,” said Dan Gunner, director of Research and Analytics at PEI Media.

Last year’s largest fundraise was achieved by Canada’s Brookfield Asset Management, which reached a $7 billion close on its Fund II last October. But three other firms also surpassed the $1 billion mark in 2013: Stonepeak Infrastructure Partners, IFC Asset Management and Actis.

Large fundraising successes came with a vote of confidence for vehicles seeking to source opportunities globally, with more than half the capital raised – $16.9 billion – going to funds with such mandates. Vehicles looking to invest across Europe and in North America each collected around $3.5 billion.

Yet if headline numbers were impressive, the picture was that of more money going to fewer funds. With just 40 closings, the number of vehicles raised last year was the lowest since 2009.

“The bifurcation we’ve seen with other asset classes – some funds struggling to close while others do very well – also applies for infrastructure,” Gunner said.

There are currently 180 infrastructure funds in market, targeting an aggregate $125 billion from investors. On top of the list are Borealis Infrastructure’s Global Strategic Investment Alliance, which is targeting $20 billion, Terra Firma’s Infrastructure Fund For Global Renewable Energy, aiming for €3 billion, and Alinda Global Core Infrastructure Fund, looking to collect $3 billion.