Stonepeak Infrastructure Partners ended a summer of fundraising with a first close of over $5 billion for its third investment vehicle, a source familiar with the matter confirmed to Infrastructure Investor.
Stonepeak Infrastructure Fund III is expected to hold another close around 7 November and is on track to reach its $7 billion hard-cap by early 2018, the source said. The fund is aiming for a 12 percent net internal rate of return inclusive of a 4 percent cash yield, according to pension documents.
The vehicle offered a 1.375 percent discounted management fee and 15 percent carry for first-close investors. Those rates bump up to 1.5 percent fees and 20 percent carry for later investors, documents published by the New Jersey State Investment Council show. It has an 8 percent hurdle rate.
Like its predecessors, Fund III will focus on mid-market brownfield and greenfield investments in North America across the power, water, energy, communications, renewable energy and transportation sectors. It will aim to make equity investments of between $100 million and $1 billion aimed at controlling stakes.
Fund III’s investment period will begin soon after Stonepeak’s second fund is fully deployed, the source said. That vehicle has invested 85 percent of its $3.5 billion and is close to making its last commitment.
Founded in 2011 by former Blackstone Group executives, Stonepeak’s inaugural fund closed in 2013 on $1.65 billion. According to the New Jersey documents, that fund is generating a 14.3 percent net IRR as of 31 March, a 1.41 times net money multiple and has a 41 percent net debt to total capitalisation. Fund II closed in 2016 and is generating a 31.2 percent net IRR, a 1.23 times net money multiple wand has a 25 percent net debt to total capitalisation.
Stonepeak declined to comment.