BlackRock has held the final close of Global Energy & Power Infrastructure Fund III (GEPIF III) at USD5.1 billion, making it the largest alternative investment fundraise in BlackRock history. The final close value also exceeded both the original Fund target of USD3.5 billion and the original hard cap of USD4.5 billion.
“This milestone is a testament to BlackRock’s focus on helping clients achieve better investment outcomes,” says Edwin Conway, Global Head of BlackRock Alternative Investors. “Investors are looking to build resilience into their portfolios and ballast against equity market shocks by increasing their allocations to less correlated exposures in private markets. The current market volatility has underscored the value of our commitment to delivering solutions that can help our clients match their long-term liabilities and support their beneficiaries. Investor demand for this fundraise reinforces our belief that infrastructure will play an increasingly important role in portfolio construction moving forward.”
The Fund’s commitments include investment mandates from over 50 institutional investors, including public and private pension funds, sovereign wealth funds, foundations, insurance companies and non-profit organisations across the US, Europe, Asia and the Middle East. Over 70 per cent of the commitments are from investors in the prior fund, which reflects investors’ high-level of confidence and trust in the GEPIF team and its expertise in the space.
Building on the investment strategy of its predecessor funds, GEPIF III aims to generate strong uncorrelated returns from investments in high-quality and essential energy infrastructure businesses and assets. These companies will generally have long-term contracts and visible revenue streams from strong counterparties and seek to provide robust dividend yields to investors. The investments are diversified geographically and by energy sub-sectors, which primarily consist of: 1) the power sector, including electric power generated from renewable sources (solar, wind, hydro and waste-to-energy) and from natural gas, while excluding coal-generated power, 2) the midstream sector, including energy transportation and storage, and 3) the utility sector.
Mark Florian, Head of the Global Energy & Power Infrastructure team within BlackRock Real Assets, says: “The success of the fundraise reflects the search for diversified returns in a yield-starved environment, which continues to be front of mind for investors. Our strong off-market sourcing capabilities are differentiated by a disciplined investment approach focused on creating an optimised risk-adjusted return for our investors and a tailored solution for our partners and their customers. This philosophy has led to strong investment deployment and origination that includes multiple repeat partnerships with great companies, and we believe this strategy will continue to create many investment opportunities for our Funds.”
