The Rise of Infrastructure Funds

Infrastructure is a component of real asset investing that focuses on the distribution of goods, people, and resources. Examples of economic infrastructure assets include ports, airports, tollroads, bridges, energy distribution networks, and data centers. Examples of social infrastructure include education facilities, hospitals, and government buildings.

Infrastructure assets have several highly favorable characteristics:

  • long useful lives;
  • high barriers to entry;
  • essential to the functioning of society;
  • monopolistic market positioning;
  • generally stable usage;
  • inelastic demand;
  • stable cash flows.

According to the 2024 Mercer Investments Large Asset Owner Barometer report, infrastructure is the asset class to which the largest proportion of investors were seeking to add exposure. A growing number of asset managers have launched registered funds to fill the investor demand for infrastructure exposure.

Traditionally, infrastructure investment vehicles have had the challenging “J-curve”, in which a project can generate small negative returns for several years while a project is developed. Institutional investors with large portfolios near infinite time horizons can easily fit investments with a steep J-curve into their asset allocation plan. However, retail investors, as well as many institutions may prefer to invest in assets that are already prdducing cash flow.

Managers can mitigate the J-curve by investing into existing infrastructure on the secondary market, either through operating companies, or other investment funds. Only recently has the secondary market for infrastructure assets become robust enough to make it possible for fund managers to easily offer infrastructure exposure in evergreen investment structures with intermittent liquidity.

Infrastructure Funds: Product Structuring Considerations

Managers looking to launch infrastructure products to the broader market need to match structure and strategy. This requires a careful consideration of the intended investor base, liquidity requirements, as well as accounting and compliance requirements.

Generally, interval funds are more suitable for core infrastructure investments into fully operational assets. Brownfield investments that require additional capex would work better in an Opco vehicle. Value add and core plus strategies that involve a mix of established assets and potential expansions, and generate a mix of current yield and capital appreciation can work in a wide range of fund structures, provided the manager as long as the manager carefully manages liquidity and reporting requirements.

Across different fund structures, there are 16 active registered funds that focus on infrastructure investments as their main strategy. By number, interval funds are the most popular, accounting for half of existing infrastructure funds.

Versus Capital Real Assets LLC, which launched in 2017, is an interval fund with $2.8 billion in assets. It invests in private infrastructure funds, along with timberland and agriculture funds. It has a sub-REIT that makes direct investment into infrastructure assets. There are several other infrastructure nterval funds in the pipeline, or recently launched. For example, the CION Grosvenor infrastructure fund launched the in beginning of 2025 with a $240 million portfolio invested across 43 infrastructure assets.


Although there are a lot of infrastructure interval funds, Opcos still account for the largest portion of assets:

The KKR Infrastructure Conglomerate is the largest example, with $2.6 billion in net assets s of the most recent SEC filings. CIM Opportunity Zone Fund, L.P. is another large infrastructure Opco, with $1.9 billion in net assets. The Qualified Opportunity Zone program can provide tax advantages for infrastructure investments in certain areas. Also notable, Apollo Infrastructure Co has over $700 million in net assets.

The largest infrastructure tender offer fund is the Brookfield Infrastructure Income Fund, which launched in 2023, and already has $2.7 billion in net assets.

A note on fund classification

Note that for purposes of this article  we are excluding funds that mention infrastructure in their prospectus  as one small  part of a broader strategy. For example, AMG Pantheon Fund focuses on PE secondaries, including infrastructure.  Although it has over $4 billion  in net assets, infrastructure strategies comprise  a tiny proportion.  

For a complete list of all funds included, sign up for Alternative.Investments Pro or Interval Fund Tracker Premium Plus.

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