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Institutional Target Allocations to Infrastructure Grow in 2024, with 3-Year Returns Exceeding Long-Term Targets Globally Finds Infrastructure Allocations Monitor from by Hodes Weill and Cornell University’s Program in Infrastructure Policy

Target allocations grew 42 basis points to 5.50% in 2024, while institutional investors remain under-invested to the asset class by 123 basis points

Despite moderating portfolio returns in 2023, three-year average return of 10.1% exceeds current target return of 9.3% by 78 basis points

Investor sentiment remains favorable, as institutions expect to actively deploy capital over the coming years

Institutions globally continue to favor investments in North American infrastructure opportunities

Digital, energy and transportation infrastructure are the sectors of greatest interest over the next 12 months

Despite institutions’ under-allocation to infrastructure, 2023 was the most challenging year for private infrastructure fundraising since 2015, according to the second annual Institutional Infrastructure Allocations Monitor released today by Hodes Weill & Associates and Cornell University’s Program in Infrastructure Policy. However, in light of growing target allocations to infrastructure and positive investor sentiment, the pace of annual investments is expected to accelerate over the medium-term. Globally, institutions are under-invested in infrastructure by an average of 123 basis points versus target allocations. Over the past 12 months, the gap between actual and target allocations narrowed, as actual allocations grew faster than targets among repeat respondents.

Over the past 12 months, institutions increased their target allocations to infrastructure by an average of 42 basis points to 5.50%. Amidst a backdrop of a higher-for-longer interest rate environment, heightened inflation, and global decoupling in the face of deglobalization, institutions largely spent the last 12 months on the sidelines, focused on managing their existing portfolios and waiting for valuations to find a bottom. The growth in target allocations represents an effective increase of 8.3% in capital allocations, implying the potential for an additional US$34.5 billion of incremental investment among survey participants alone. Extrapolating this to the broader universe of institutional investors, this could imply approximately US$0.5 trillion of additional investment.

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Although infrastructure fundraising has seen headwinds in 2023 and during the first half of 2024 – especially in comparison to the pace of the late 2010s and early 2020s – the outlook for future fundraising remains promising when taking into account waning portfolio denominator and numerator issues, as well as go-forward investor objectives. The tailwinds for the infrastructure sector are tangible, and institutions continue to take notice of performance in the asset class amidst macroeconomic volatility and rising political uncertainty.

Of note, 45% of institutions report a target allocation to infrastructure of less than 5%, leaving a compelling runway for continued growth in the role the sector plays across institutional portfolios. The Americas lead the world in regional target allocations, with an 8.1% weighted average target allocation dominated largely by Canadian institutions, which report an average target allocation of 12.6%. At 5.4%, U.S. target allocations exceed those in EMEA at 4.3% and Asia Pacific at 5.2%. As infrastructure matures in jurisdictions newer to the asset class, it is reasonable to expect that target allocations to keep climbing and will resemble the trajectory of those in jurisdictions at the forefront of infrastructure including Canada, Australia, and the Nordic Region.

Looking ahead to the next 12 months, approximately four in five institutions plan to hold their allocations flat, with 20% of institutions planning to increase their allocations – down from 43% in 2023. While increases in target allocations are moderating, only 1% of respondents have plans to decrease their allocations to infrastructure. Favorable conviction and strong relative investment performance are expected to contribute to continued growth in allocations over the coming years; further, the asset class has demonstrated its role as a portfolio stabilizer amidst broader market uncertainty.

Mark Rudovic, Principal and Head of Real Assets at Hodes Weill, said, “The global market environment has become increasingly volatile over the past several years, with fluctuating interest rates, inflation and geopolitical considerations requiring institutions to assess a range of risks. What’s more, 2024 is the biggest election year in history, with national and regional elections to be held in more than 50 countries with a combined population of 4.2 billion people. The potential for broader geopolitical changes following global elections also creates a measure of uncertainty that may lead institutions to take their feet off the gas while they work to assess changes in the political landscape. That said, investor sentiment towards infrastructure remains favorable, and we believe this will drive increased investment as institutions return to normal deployment rates.”

Both actual and target allocations have increased, with the growth in actual allocations (+76 basis points) outpacing the growth in target allocations (+29 basis points) for repeat participants. Investors cite liquidity constraints as a significant factor, driven by limited distributions from existing infrastructure and other private markets investments, including real estate, private equity, and venture capital. This dynamic has brought many investors closer to their target allocations, thereby restricting their ability to deploy capital at the scale and pace consistent with historical levels.

Infrastructure portfolios continue to demonstrate resilient revenues and offer investors strong risk-adjusted returns, despite general market volatility. In 2023, institutional infrastructure returns moderated to 7.1%, falling below long-term target returns after significant outperformance in 2021 and 2022. Institutions largely attribute this to the broader macroeconomic environment and view performance in 2023 as favorable relative to other asset allocations. The three-year average return of 10.1% surpasses target returns by 78 basis points, in part attributed to “inflation participation,” an arguably unique attribute of infrastructure investing.

In terms of geographic focus for investment, 32% of investors expect to increase allocations to North America – more than any other region, but only slightly ahead of Europe. Roughly 25% of institutions plan to increase allocations to Europe over the next 12 months. Institutions are favoring higher-return Value-Add and Core+ strategies as the rise in interest rates continues to impact the relative attractiveness of, and appetite for, SuperCore and Core strategies.

Looking at preferences by infrastructure sector, 85% of institutions indicate an intention to invest in digital infrastructure in 2024, down slightly from 87% in 2023. This sustained enthusiasm reflects institutions’ commitment to supporting the digital economy’s infrastructure. Since 2019, the drive towards technology, enterprise modernization and advanced data processing has significantly accelerated. Amidst rapid commercial adoption of emerging A.I. technologies, digital strategies remain in favor, with continued strong demand for data center investments. Consistent with recent fundraising data, roughly 36% of respondents indicate plans to increase allocations to renewable energy and storage, which is more than any other energy subsector.

Globally, 89% of institutional investors consider ESG at least “slightly important” to their investment decisions, while only 11% consider ESG “not at all important” to their investment decisions. These results reflect a 5% year-over-year increase in institutions that take ESG into some level of consideration when making investment decisions. Still, there remains considerable regional differences in ESG definitions and integration, especially with respect to the level of data and reporting required of investment managers.

Dr. Rick Geddes, Founder and Academic Director of Cornell University’s Program in Infrastructure Policy, said, “The 2024 Allocations Monitor reveals that, although there has been prodigious public infrastructure spending in North America, the need for private capital to support these vital needs is greater than ever. The 2024 Allocations Monitor is also pivotal because for the first time it reports not only levels, but also trends, in global institutional investor allocations into infrastructure. This year’s report also suggests that it is important to educate the investment community, including individual retail shareholders, about opportunities in the infrastructure investing space.”

102 institutions from 20 countries participated in the survey, representing aggregate AUM exceeding US$8.2 trillion and portfolio investments in infrastructure totaling approximately US$350 billion.

About Hodes Weill

Hodes Weill & Associates is a leading, global capital advisory firm focused on real estate, infrastructure and other real assets. The firm has offices in New York, Denver, Hong Kong, London, Amsterdam and Tokyo. Founded in 2009, Hodes Weill provides institutional capital raising for funds, transactions, co-investments and separate accounts; M&A, strategic and restructuring advisory services; and fairness and valuation analyses. Clients include investment and fund managers, institutional investors, lenders, and public and private owners of assets and portfolio companies. For more information, please contact or visit

*All U.S. regulated capital market and securities advisory services are provided by Hodes Weill Securities, LLC, a registered broker-dealer with the SEC, and a member of FINRA and SIPC, and internationally, by non-U.S. Hodes Weill affiliates.

About Cornell University’s Program in Infrastructure Policy

The mission of the Cornell Program in Infrastructure Policy is to improve the delivery of civil, energy, social, and digital infrastructure through dedicated, high-quality research, teaching, and public outreach efforts. We focus on the procurement, funding, alternative financing, and technological developments across the infrastructure industry. We maintain a network of scholars across multiple disciplines both inside and outside of Cornell University who share an interest in public policies impacting infrastructure delivery. We collaborate with partners in the public, private and non-profit sectors to develop and disseminate research, develop new educational courses, share industry best practices, organize webinars, and host conferences about infrastructure policy.


For informational purposes only. This is not a solicitation to buy or sell any securities or securities products. Please refer to the full report for important disclaimers. The full report can be found at


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