LONDON, 11 December 2024 – Preqin, the global leader in alternative assets data, tools, and insights, today published its Preqin 2025 Global Report: Infrastructure. The report highlights that infrastructure fundraising and deal-making remained soft in 2024 and are weighing on dry powder levels. Infrastructure dry powder, as a proportion of assets under management (AUM), hit a new historical low in 2024. This AUM figure dropped 3%, or $38.5bn, over the first quarter of 2024* to 24%, compared with 35% at the end of 2020.

Global infrastructure fundraising remains soft in 2024

Infrastructure has endured a prolonged slowdown in fundraising since the beginning of 2023, amid elevated interest rates. Additionally, the large amounts of capital raised in 2022 helped fulfill investors’ allocation ambitions. $70bn was raised by Q3 2024, showing a similar pace of fundraising to 2023 at $95bn over the year. In comparison, the preceding five years saw an average of $136bn being raised on an annual basis.

Preqin data demonstrates that North America-focused fundraising contributed to slower fundraising in 2024, and this may continue in 2025. The number of North America-focused funds closing per year fell from a peak of 63 in 2021 to 18 by Q3 2024. Aggregate capital raised by those 18 funds was $20bn, 50% of the average $40bn raised by funds targeting the region over the first three quarters of the preceding five years.

Deal-making remains subdued, but telecoms sector finds newfound relevance

Looking at infrastructure deal-making, volumes remained slow. In 2024 to the end of Q3, there were 1,448 deals, or 96% of deal volume in 2023 (1,516) to the end of Q3. Preqin analysts note that anticipation of further rate cuts may be dragging on the market, as sellers hold out for higher prices and buyers wait to finance deals at lower debt costs.

One sector that showed resilience amid a subdued market is telecoms. This comes from increased demand for data centers thanks to the growing use of artificial intelligence (AI). Telecom’s share of aggregate deal value by Q3 2024 reached a new high of 30% at $65bn, compared to 12% ($27bn) in 2023 to Q3, underlining the sector’s newfound importance to the asset class.

Alex Murray, Vice President, Head of Real Assets, Research Insights at Preqin, says, “Despite infrastructure’s still slow fundraising and deals environment, performance remains resilient for the asset class. The Preqin index shows that performance has consistently been positive, rising in all but one quarter since 2009. However, infrastructure’s success in recent years has been hampered by high interest rates more recently, raising concerns over performance sustainability.”

Additional key findings from the Preqin Global Report 2025: Infrastructure include:

• Dry powder versus capital calls: Preqin data shows that concerns of deal-making being impacted by a slower fundraising environment might be misplaced, judging by the rate of capital calls to investors by fund managers. By Q1 2024, despite dry powder stock dropping to $335bn, it was still 3.6 times the amount of capital calls over the 12 months to Q3 2024 ($92.9bn).

• APAC-focused average fund size: APAC-focused funds played a key role in infrastructure fundraising this year, with the average size of APAC-focused funds at $1.4bn over 2024 to Q3. This new high is driven by large core strategy funds, suggesting the region is no longer seen as a higher risk market by investors.

• First-time fund managers’ share of fundraising: The challenging fundraising environment has impacted first-time fund managers more noticeably in 2024, with their share of yearly aggregate capital raised at an all-time low – down from 39% in 2015 to 6% by Q3 2024.

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Notes to the editors

* The latest data available. Preqin has a six-month lag in its AUM analysis to ensure it has as complete a dataset as possible when calculating values.