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Infrastructure Fundraising Improves in Q4 2011

According to Preqin data, 25 unlisted infrastructure funds have held a final close during 2011, raising an aggregate $14.8bn.  Despite a slow first three quarters of the year, the 2011 fundraising total has significantly improved due to a further four funds closing in Q4 thus far, raising an aggregate $6.7bn. As it stands, the capital raised in Q4 2011 represents the fourth highest quarterly amount raised by unlisted infrastructure funds since the end of 2008; behind Q3 2010 ($12.6bn), Q1 2010 ($8bn) and Q2 2010 ($7.5bn).

ArcLight Energy Partners Fund V is the largest infrastructure fund to close in 2011 YTD, closing on $3.31bn in November.  The fund raised $1.31bn more than its original fundraising target which can in part be attributed to the performance of its predecessor funds, a key factor for LPs when selecting fund managers.  Two other funds closed with over $1bn in capital commitments in Q4 including the $1.7bn United States Power Fund IV and the $1.2bn InfraRed Infrastructure Fund III, which closed $200mn above its original target.

Although 2011 infrastructure fundraising is still some way below the levels seen prior to the financial crisis, fund managers can take solace in the fact that 37 unlisted infrastructure funds have held an interim close during 2011 YTD.   This shows that institutional investors are allocating fresh capital to unlisted infrastructure funds and that we can expect to see an uptick in the number of funds holding a final close during 2012.  Prominent funds to hold an interim close in 2011 include Macquarie European Infrastructure Fund IV (November), AXA Infrastructure Fund III (September), and RREEF Pan-European Infrastructure Fund II (April).

Posted by Iain Jones on 16-Nov-2011

Keywords: infrastructure fundraising, unlisted infrastructure, Q4 fundraising, infrastructure capital