AMP Capital Raises Its Biggest Closed-End Fund Ever

AMP Capital has raised $6.2 billion to invest in infrastructure debt, including capital for the firm’s largest ever closed-end fund.

The Australian asset manager said Tuesday the total raised includes $4 billion for its Infrastructure Debt Fund IV, $1 billion for co-investments, and $1.2 billion from investors seeking access to “debt deal capabilities.” AMP Capital believes the full investment pool may be a record for an infrastructure mezzanine debt strategy.

The fundraising attracted more than 30 institutional investors joining the strategy for the first time, reflecting increasing demand for infrastructure debt, according to the asset manager. The pace of attracting capital was quick.

“In less than a year, a total of 86 investors from 14 countries invested in IDF IV with strong demand from institutional investors in Korea, Japan, Canada and the UK,” said Andrew Jones, AMP Capital’s global head of infrastructure debt, in a statement. 

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Unlisted infrastructure funds raised $8.4 billion during the third quarter, down significantly from $44 billion during the same period in 2018, according to a Preqin report this month. Still, 83 percent of infrastructure pools closed in the first nine months of 2019 finished fundraising within two years — a higher portion than last year that indicates “institutional demand remains strong,” Preqin said in the report.

The provider of alternative assets data found increased interest in debt infrastructure funds. Twenty-eight percent of infrastructure investors are targeting debt funds over the next year, up from 21 percent in the third quarter of 2018, the report shows. 

Renewable energy remains the largest sector in the infrastructure market, accounting for about half of all completed deals during the third quarter, according to Preqin. “Other industries are on the rise,” the data tracker said, pointing to growth in transport and telecom deals within infrastructure investing.

AMP Capital’s new pool is focused on investments in energy, utilities, digital technology, and transport infrastructure, according to its statement. The firm said it has already invested $2 billion of its fresh capital in ten “high-quality assets” globally, including a district heating business in Europe and a North America data center.