Average Infrastructure Fund Size Tops $1bn, Highest Since 2007

Preqin’s latest research shows that infrastructure funds that have reached a final close so far this year have raised $1bn in capital on average, representing the highest average fund size seen since 2007, when funds raised an average of $1.1bn.

Infrastructure funds closed in 2014 year-to-date have raised an average of $1bn, the largest average amount since 2007

The average size of infrastructure funds has increased by 44% compared to 2013, as a result of greater amounts of capital being committed to fewer funds.

In 2014 to date, 26 unlisted infrastructure funds have reached a final close raising an aggregate $25bn, compared to 41 funds raising a total of $23bn over the same period in 2013.

Other Key Facts:

• 16 funds held an interim close in Q3 2014, securing an aggregate $3.2bn.
• The average time taken for funds to reach a final close has fallen from the peak of 25 months for funds closed in 2012 to 20 months for funds closed in 2014 YTD.
• 61% of funds closed so far in 2014 have exceeded their fundraising target, compared to 38% of funds that closed in 2013.
• There are currently 148 funds in market seeking capital, with an aggregate target of $94bn, slightly above the 136 funds that were in market at the start of 2014 which were collectively seeking $86bn.
• The two largest infrastructure funds on the road are both seeking commitments of $4bn respectively. These are ArcLight Energy Partners Funds VI and Morgan Stanley Infrastructure Partners II.
• A total of 156 infrastructure transactions were made in Q3 2014 globally, with an estimated aggregate deal value of $88bn.
• 35% of deals in Q3 2014 were in European assets, down from 45% of deals in Q2 2014.

Top 10 Unlisted Infrastructure Funds in Market by Target Size

Top Five Unlisted Infrastructure Funds Closed in Q3 2014

Notable Infrastructure Deals Completed in Q3 2014

“There remains significant institutional investor appetite for infrastructure exposure, which is reflected in the continued strong fundraising seen in 2014 to date. A number of the largest players in the infrastructure fund space have closed large offerings this year, frequently exceeding their fundraising goals, and the average infrastructure fund is now over $1bn in size. The number of funds to close has fallen however, as the larger players have taken a greater share of the market, and for many of the more recently established infrastructure fund managers, fundraising remains a very difficult prospect” says Andrew Moylan, Head of Real Assets Products, Preqin.