After two years of decidedly mixed results, private infrastructure investing appears to be back on track. This year’s report on the state of the industry—the fifth in our annual series—offers compelling evidence that general partners (GPs) at private infrastructure funds and their limited partner investors (LPs) have gained renewed confidence in the asset class. Fundraising is up, assets under management (AUM) is at an all-time high, and dealmaking appears to be on the upswing again.
That doesn’t mean the industry is now free of the challenges it’s been facing recently. Inflationary pressures, high interest rates, regulatory uncertainty, and volatile geopolitics remain concerns. What it does mean is that the industry is changing. LPs have committed increasing amounts of capital to the largest GPs as they seek security in a challenging investment environment. GPs are looking to boost deal flow and diversification, placing bets on companies in an ever-increasing variety of emerging infrastructure sectors.
As this year’s report shows in detail, LPs remain confident in infrastructure, even as their expectations are changing. And GPs are working hard to meet those expectations through increased support of their current portfolio companies and their search for new companies to invest in.
The Year in Numbers
As confidence in the investment value of infrastructure assets revived, LPs poured a total of $211 billion into the asset class in 2025, an increase of more than 60% over the previous year, and 11% more than in the previous peak fundraising year of 2022 (see Exhibit 1). This brought total infrastructure AUM to $1.6 trillion, fully 10% of all alternative assets.
The increased appetite for risk on the part of LPs is especially notable. Investors, trusted fully 70% of that new capital to core-plus and value-added strategies, up from just 54% in 2024. Clearly, investors have renewed their faith in the potential value of private infrastructure assets—a message confirmed by a recent survey of LPs, 46% of whom plan to increase their infrastructure allocations, a greater proportion than for any other type of alternative assets.
Deal flow stabilized compared to the past two years, but the average holding period for portfolio companies owned by the top 50 GPs increased to 7.6 years in 2025 from 6.1 years in 2021. And while the number of exits is higher than it’s been since 2022, many involved sales to continuation vehicles and open-ended infrastructure funds.
As this year’s report shows in depth, returns on infrastructure investments have been average, and the degree of volatility has been higher. Much of the gains in the enterprise value of the asset class’s portfolio companies has not come from an increase in their multiples, but rather by boosting EBITDA. Increasing enterprise value has largely become a matter of operational improvements.
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Sector by Sector
The renewed growth in private infrastructure investing is having an impact on all four primary infrastructure sectors—energy and environment, transport, digital, and social infrastructure. Transport, for example, and particularly the shipping, air traffic, and ports subsectors, is finally recovering from the effects of the COVID-19 pandemic, while logistics affected by the disruption on global trade flows.
But the two biggest stories in infrastructure involve the energy and digitization sectors—and the growing link between them. Deals in the renewables subsector are down, the result of increased cost, challenging energy markets as capture prices decline, and evolving political, financial, and regulatory support. At the same time, interest in data centers continues to grow rapidly, given the high expectations for demand for their computing power. Yet the feasibility and scalability of data centers is becoming increasingly constrained by the availability of the necessary power.
As a result, energy strategy is becoming a critical component of data center design and location, opening up additional investment opportunities in the energy sector, notably in conventional power generation and distribution.
New Horizons
Even as the competition for the best deals in traditional infrastructure sectors heats up, investors are looking elsewhere for new profit pools and expanding the definition of infrastructure as they do so. In one sense, of course, this is an ongoing trend. In just the past decade, the percentage of portfolio companies in new areas such as data centers, waste, EV charging and equipment leasing, have grown from 3% to 19%.
More recently, investors have been looking further afield, into opportunities in services, technology, agriculture, and manufacturing (see Exhibit 2). While some are less asset-heavy and others less reliant on high barriers to entry than traditional infrastructure assets, they’re all offer consistent demand and regular cash flows.
- Services. This includes a variety of financial services, testing, inspection, and certification, and equipment rental and asset pooling deals. They offer varying degrees of entry barriers as well as resilient demand, captive customers, and opportunities for growth.
- Manufacturing. Target companies in this category include contract manufacturers as well as manufacturers of critical safety equipment and semiconductors. These are typically relatively asset-heavy, with high capex requirements and high barriers to entry.
- Agriculture. Companies in this key area benefit from consistent demand and strong prospects for new farm and food technologies, although they may be subject to factors such as commodity crop prices, tariffs, and geopolitics. They include producers and distributors of crops and livestock under recurring production cycles and long-term contracts, as well as forestry assets.
Conclusion
The takeaway from this year’s report on private infrastructure investment is clear: The industry is heading into a period of increased dynamism—one that is becoming more competitive, more demanding operationally, and more diverse. LP investors are growing more willing to take on modest levels of increased risk in search of higher returns, and investment funds are seeking out newly emerging infrastructure investments in hopes of meeting those expectations.
In this environment, success will depend on investing in the best investment assets, no matter where they can be found and then carefully nurturing their growth to provide the strongest, most consistent gains in value.
