Renewed focus on infrastructure projects in North America has benefited the unlisted infrastructure market in the region, according to data released by Preqin.
Over the past decade, North America-focused funds have raised an aggregate USD178 billion, far ahead of USD119 billion raised in the same period for Europe, the next largest market. Although North America-focused unlisted infrastructure fundraising experienced a gradual decline from 2013 to 2015, the region represents the largest infrastructure fundraising market in the world. 2016 was a record year for the region, with 23 funds securing USD33 billion in capital commitments, including the largest infrastructure fund ever closed. So far, it seems as though 2017 is on the path to continue last year’s fundraising momentum, with 12 funds having secured USD20 billion as of August.
North America is home to the seven largest firms by total capital raised for unlisted funds in the past 10 years. Additionally, nine out of the 10 largest unlisted funds ever closed are primarily targeting North America and account for 19 per cent of all unlisted infrastructure capital secured.
North America-focused funds have become more successful in their fundraising year-on-year. In 2015, 42 per cent of funds exceeded their target size; this has risen to 75 per cent of funds closed in 2017 YTD. In fact, half of funds closed so far this year have raised 125 per cent or more of their target size, the largest proportion tracked by Preqin.
Currently, there are 47 North America-focused unlisted infrastructure funds in market with a combined target of USD79 billion in capital commitments. This includes Blackstone Infrastructure I which, with its USD40 billion target size, is seeking to be the largest ever infrastructure fund.
Tom Carr (pictured), Head of Real Assets Products at Preqin, says: “North America has traditionally represented the largest part of the unlisted infrastructure fundraising market, but activity has reached new heights in the past 18 months. The 2016 US presidential election prompted a renewed focus on infrastructure in the country, and fund managers have moved to take advantage of the perceived opportunity this represents.
“Looking ahead, there are several multi-billion dollar funds currently seeking capital to deploy into projects in North America, including Blackstone Infrastructure I, which is seeking to be the largest ever infrastructure fund. With the dealmaking environment in North America showing long-term growth, and vying with Europe to become the most active region for infrastructure investments, the prospects for managers to deploy capital in the coming months are promising.”
