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Turbulence to Turnaround?

A tricky 2023 for fundraising and deals turns to positive momentum in 2024 for the infrastructure asset class

At a glance;

  • After a tricky start to 2023, infrastructure regained its prominence, closing Q4 2023 with the second-highest level of fundraising achieved since records began, with over USD 80 billion secured for future investment. It also marked the best performing fourth quarter in history.  
  • The positive trend continues into 2024, with USD 36 billion raised by the end of April, surpassing levels achieved in the same quarter last year. Additionally, prominent acquisitions by BlackRock of GIP and Generali by Actis have added to a bounce back for the asset class after significant headwinds in 2023. 
  • The impact of conflicts in Europe and the Middle East, labour shortages, high inflation and interest rates driving up materials and the cost of capital, and poor performance in other asset classes hampered infrastructure fundraising for the first three quarters of 2023. Supply chain disruption has also had negative effects, which has resulted in a drive to reconfigure supply chains, through the creation of new industrial and economic clusters that will require significant development of new and existing infrastructure. 
  • The 4D megatrends of decarbonisation, digitalisation, demographics, and deglobalisation have become commonplace trends in infrastructure, that remain significant drivers of investment. Private infrastructure investors are well positioned to fill the gap between infrastructure targets set by governments globally and the challenging fiscal and monetary environment facing public sector finances.  

Below we take a look at fundraising and deals over the past year in more detail:

Fundraising trends 

2023: A story of two halves 

As shown in the table below, fundraising experienced a significant rebound in Q4 2023 compared to the previous three quarters, with over USD 80 billion raised. We attribute this largely to a partial resolution of the denominator effect and the macroeconomic challenges facing the asset class.

Market Insights
Source: Realfin 2024

The turnaround gains additional significance when you consider that Q4 2023 saw the second-highest fundraising record after Q1 2022, as well as an average closed fund size of USD 1.05 billion compared to USD 1.2 billion in 2022. This points to possible pent-up demand by LPs who may have been delaying decisions given the challenging market conditions outlined above. 

Fundraising in the infrastructure asset class experienced a significant rebound in Q4 2023 compared to the preceding three quarters, with investment funds raising over USD 80 billion. The stark increase signals a significant turnaround compared to the first three quarters, which saw a combined total of USD 40 billion raised, where the impact of the denominator effect and macro challenges weighed heavily on those seeking to raise funds.  

Look ahead to the rest of 2024 

Compare this to the start of this year and the positive trend looks set to continue, with the stabilisation and potential future cuts of interest rates improving the outlook, alongside robust performance in public markets, mitigating the denominator effect observed over the past year. 

In Q1 2024, over USD 36 billion was raised across 19 funds, averaging USD 1.9 billion per fund. However, this figure is only slightly above the 10-year average for the quarter of USD 35 billion. In terms of the number of funds, it is nearly half of the ten-year average, with 19 funds in Q1 2024 compared to an average of 37 funds. 

Market Insights
Source: Realfin 2024

While Q1 2023 saw 28 funds closing at USD 9 billion, the smaller number of funds highlights a trend towards consolidation with a smaller selection of fund managers raising capital. Last year, Brookfield was responsible for USD 51 billion, just over one-third of all fundraising that year, with KKR, Macquarie, GIP, and Stonepeak responsible for a further USD 63 billion collectively. 

LP commitment sizes have also seen a fivefold increase since 2022, from around USD 400 million to USD 2 billion with most funds raised in the North American and European markets. 

See the next section of our market analysis on deal flow as we take a look at how 2024 compares to a tricky 2023 for closed deals.  

Deal flow analysis 

Deal flow in 2023 witnessed a notable decline from the record-setting year of 2022, with decreases evident across all sectors and regions, apart from North America. It’s worth noting that the deceleration in M&A activity extended beyond infrastructure, affecting the majority of asset classes, reflecting the challenging macroeconomic and geopolitical environment.

While fundraising alignment to the 4D megatrends supported a late resurgence in 2023, this wasn’t matched with a turnaround in deal flow. Greenfield transactions however did see an increase where sector investments aligned to energy security and decarbonisation helped prop up the market downturn.  

Below we take a deeper look at first quarter performance over the last ten years, and how deal making in 2023-24 compares.  

As shown in the graph below, deals in the first quarter of 2024 are in line with the 10-year average, but the worst performing over the past five years. This can be partially attributed to M&A activity being subdued following the challenges witnessed in 2023.

Market Insights
Source: Infralogic, 2024 

Activity across certain countries has also decelerated since 2023, with many of the top 10 best performing countries in 2023 now seeing less activity, including Germany, India and Saudi Arabia. The USA, UK, Brazil, Spain, and Australia meanwhile are performing well, while the likes of France, Mexico, Sweden, Italy, and Canada show positive momentum in Q1 2024 compared to Q1 2023. 

As shown below, in comparison to previous quarters, M&A value still ranks in the bottom five of all first quarters since 2015. However, deal numbers rank fourth in the same period, potentially indicating a modest resurgence of managers testing the waters with smaller transactions. Nevertheless, both deal value and volume in Q1 2024 remain lower than in Q1 2023. Average volumes were 387 transactions worth USD 86 billion per quarter in 2023, whereas in 2024, they stand at 333 transactions worth USD 74 billion. 

Market Insights
Source: Infralogic, 2024 

While greenfield investment stood out as a major highlight of 2023, thus far, 2024 has underperformed, with deal volume at 174 transactions, amounting to just USD 59 billion, well below the five-year average. This lack of improvement could be attributed to current interest rates remaining stagnant and a prevailing sentiment that inflation and high interest rates are persisting, driving investors to be more cautious with capital given its high cost. 

Market Insights
Source: Infralogic, 2024 ​​​

Although refinancing numbers were average for Q1 2024 compared to the last 10 years, attracting additional financing has maintained its robust position since 2023, reaching an all-time high in terms of value, at USD 21 billion, and volume, at 80 transactions. In fact, when considering Q1 2024 in its entirety, the only quarters to surpass the additional financing figures are Q2 and Q4 of 2023. Notably, Q4 2023 established a record additional financing figure for the past 10 years. 

Interestingly, nationalisations are at an all-time high in Q1 2024, with 6 transactions in the pipeline – the highest in the past five years. Already this year, there are as many transactions in the pipeline as there were for the whole of 2023. Last year saw 5 assets privatised, whereas this year, one has already been completed.


Infrastructure demonstrated its resilience throughout 2023, marked by soaring inflation, stringent monetary policies, and a slowdown in both fundraising and deal flow. While unlisted infrastructure fundraising experienced a notable resurgence in Q4 2023, deal activity has yet to reclaim the heights of the preceding five years.

As interest rates moderate, bond yields stabilise, and central banks pivot towards rate cuts, the outlook for 2024 anticipates a gradual recovery, buoyed significantly by global megatrends such as decarbonisation and digitisation. Moreover, a mounting public deficit positions private infrastructure investment at the forefront of efforts to fulfil governments' net-zero ambitions.