IJInvestor has released its full-year fundraising report for 2020 – in which infrastructure funds managed to raise more capital than in 2019, despite the global pandemic.
2020 – the year that couldn’t end soon enough – is now behind us, and it is time to tally up the results for the infrastructure fundraising market.
The bottom line – infrastructure funds raised 7% more capital ($96.4 billion) from investors in 2020 than they did in 2019 – may seem counterintuitive against the backdrop of economic mayhem inflicted by Covid-19. It’s all the more surprising given that the infrastructure market did not go completely unscathed – for instance, in the case of empty airports or overwhelmed hospitals.
But after an initial freeze when the virus first became a global problem, investors got back to work and capital continued to flow into sector. Indeed, the pandemic even coincided with (if not triggered) an unprecedented surge in sustainable investing.
- in 2020, fewer funds were oversubscribed. There was also an increase in the number of funds that did not meet their target sizes.
- in H2, for the first time the average size of debt funds that closed was slightly higher than the average size of equity funds.
- the percentage of European LPs in funds that closed during 2020 has dropped significantly, from 52% in 2019 to 36% in 2020. Asian LPs were willing to take more risk by investing in new funds that launched in 2020.
- investors pumped an additional $5.5 billion into telecoms transactions in 2020 compared with the year before.
- spending on oil & gas assets dropped precipitously – by over $20 billion