With the recent IPO of Jasmine International’s Jasmine Broadband Internet Infrastructure Fund, we take a look at the current listed infrastructure fund universe to assess just how large a segment of the infrastructure market listed funds account for, and if there is a continued growth of investors seeking access to the market via such vehicles. Preqin defines a listed infrastructure fund as a vehicle that is publicly traded on a stock exchange, which acquires the private equity ownership of infrastructure assets or infrastructure-related companies. Preqin currently tracks 45 listed infrastructure vehicles, with the listed fund market representing just 7% of the total infrastructure fund universe. Over the past 12-24 months however, we have seen a number of listed infrastructure funds come to market, particularly in the UK. 2013 and 2014 saw the IPO of eight UK-based funds, five of which had a specific focus on renewable energy projects. NextEnergy Solar Fund raised £86mn via its IPO in April 2014 and John Laing Environmental Assets raised £160mn through an IPO in March 2014.
Listed infrastructure funds typically offer investors a more liquid way of gaining exposure to private infrastructure investments compared to unlisted vehicles, and therefore potentially offer an attractive alternative to those investors with liquidity concerns. Additionally, listed funds often offer low management fees and operating expenses in comparison to unlisted vehicles.
Preqin’s Infrastructure Online data shows that there are currently 356 active investors within the infrastructure space that will consider investments in listed infrastructure funds. While this represents approximately 16% of the entire investor universe, this number is still substantial and shows that there could be demand for more listed infrastructure vehicles to come to market. Notable listed infrastructure funds include HICL Infrastructure Company, which launched in 2006 and was the first such vehicle to be listed on the London Stock Exchange, and Brookfield Infrastructure Partners, which launched in 2007. Bilfinger Berger listed its Global Infrastructure Fund in 2011. Regarding deals made by listed infrastructure funds, this year to date, HICL has acquired stakes in France- and UK-based education facilities at Ecole Centrale Supelec and Barking & Dagenham Schools, as well as the development rights to London-based Willesden Centre for Health & Care.