The amount of capital amassed by global infrastructure funds has plummeted year over year, putting the sector on track for the lowest annual capital raise since at least 2018, according to Preqin Pro data.
Weak fundraising in the first two quarters of the year resulted in just 35 funds collecting $13.06 billion year-to-date through Aug. 16, compared to 74 vehicles garnering $124.24 billion in the same period a year earlier, the data shows.
The $8.52 billion of capital raised in the second quarter represented an 87.7% increase from the preceding quarter but a decline of 84.7% compared to the same period in 2022.
– Check out the Data Dispatch feature on private equity investments in movies and entertainment.
– Read about private equity and venture capital investment in consumer electronics producers.
– Explore more private equity coverage.
Largest active funds
Brookfield Asset Management Ltd. and Global Infrastructure Management LLC, also known as Global Infrastructure Partners, are raising the two largest funds, each with a target size of $25 billion. EQT AB (publ)’s EQT Infrastructure VI is in second place with a target size of $21.84 billion.
Rising interest rates and an economic slowdown have made capital more expensive and scarce, resulting in a decline in overall fundraising. However, global disruption is driving new infrastructure investment opportunities, Rene Lubianski, managing partner in Brookfield’s infrastructure group, told S&P Global Market Intelligence.
“Global megatrends such as digitalization, decarbonization and deglobalization are driving multibillion-dollar investment opportunities. When you add in the challenging economic backdrop, it makes for a perfect environment for well-capitalized, value-oriented investors,” Lubianski added.
The infrastructure core strategy was the most attractive strategy for investors through Aug. 16, with 12 funds launched and $5.83 billion in aggregate capital raised. The infrastructure debt and infrastructure value-added strategies followed with $3.15 billion and $2.36 billion, respectively.
