Stonepeak Infrastructure Partners, a former unit of Blackstone Group LP (BX) that manages more than $1 billion, said it raised $1.65 billion for its first standalone fund to invest in assets including utilities and energy.
Stonepeak Infrastructure Fund I, which initially sought $1 billion, was oversubscribed, the asset manager said in an e-mailed statement. Investors include TIAA-CREF, which provides retirement accounts for teachers and non-profit organizations, pension funds and other institutions in North America, Europe and Asia, it said.
Global investors are seeking higher returns through alternative investments including real estate and infrastructure in response to low interest rates, a weaker jobs outlook and stagnant economic growth, AMP Capital Investors said in its institutional investor research report in May. Institutions had $6.5 trillion invested in alternative assets by the end of 2011, following a five-year growth rate that was seven times that for traditional asset classes, according to a May 2012 McKinsey & Co. report.
“Infrastructure and other real assets are an increasingly core element of investors’ asset allocation plans,” Trent Vichie, senior managing director of New York-based Stonepeak, said in the statement. “We are seeing a strong flow of attractive potential investments, and converting this pipeline into a select number of great, lower risk infrastructure investments will be our sole focus for the foreseeable future.”
The fund will also invest in water, power and transportation assets, it said. Stonepeak invests in North American infrastructure assets, according to its website.
An International Finance Corp. unit and GIC Pte, Singapore’s sovereign wealth fund, were the anchor investors in a $1.2 billion infrastructure equity fund, IFC, the World Bank’s investment arm, said in a statement yesterday. The new fund exceeded its target of $1 billion and will invest in sectors including power, transport, utilities and telecommunications in emerging markets, managed by teams in Washington and Singapore, IFC said.
Macquarie Group Ltd. raised $1.3 billion from institutional investors to invest in North American infrastructure assets, the Australian Financial Review reported last month.
Stonepeak was founded by Vichie and Michael Dorrell, both of whom joined Macquarie in the late 1990s. Both moved to Blackstone, the world’s biggest alternative-asset manager, in 2008 where they were co-heads of the infrastructure investment division.
The firm sees about $1 trillion of investment opportunities in the North American “middle market infrastructure sector,” which includes companies or projects needing equity investments of between $50 million and $200 million, Stonepeak said. It has pending investments in Magnolia LNG, a Louisiana-based liquefied natural gas export facility, and Paradigm Midstream, a Bakken, North Dakota-based energy pipeline and storage company, it said.
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