Growing threat of AI disruption boosts private infrastructure fundraising

Private infrastructure fundraising is accelerating as institutional investors seek the security of physical assets amid the disruptive rise of artificial intelligence.

Investors committed a record $250.70 billion to private infrastructure funds globally in 2025, more than 150% above the prior-year total of $98.80 billion, according to With Intelligence data.

Among private fund investors, known as limited partners or LPs, the average infrastructure mandate is growing, increasing to $128 million in 2025 from $108 million in 2024 and $99 million in 2023, according to the data.

In addition to powerful investment themes like the energy transition and rerouting of global supply chains, private infrastructure funds offer LPs exposure to the fast-growing digital infrastructure required to support AI. Underpinned by real, physical assets, infrastructure investments can also represent a hedge against AI's potential to disrupt entire industries.

"There is a view, with everything moving so quickly in technology and AI, that asset ownership is a safer way to play," said Brent Burnett, global head of infrastructure and real assets at Hamilton Lane.

Largest funds

Just three mega-funds accounted for nearly one-third of global private infrastructure in 2025. Global Infrastructure Partners V, Eqt Infrastructure VI Investments SARL and Brookfield Global Transition Fund Ii Gp S.à R.l. each closed on at least $20 billion, according to With Intelligence data.

Funds with a global deployment strategy collected the largest portion of investor commitments in 2025. Commitments to Europe-focused funds exceeded commitments to North America-focused funds.

– See the latest infrastructure fundraising highlights from With Intelligence. – Catch up on rising private equity investment in utilities. – Read the latest on private sector bankruptcy filings.

Infrastructure's appeal

AI's potential to upend business models — a threat that is particularly acute in the software industry — is just one facet of a volatile macroeconomic outlook also being shaped by heightened global trade tensions and a war in the Middle East that is putting pressure on global energy supplies. Investors in search of stability are turning to infrastructure, according to Jared Waldron, co-head of Northleaf Capital Partners Ltd.'s infrastructure program.

"There's a group of investors who are selling out of their fixed income part of their [investment portfolio] to create space for an infrastructure allocation. There are other folks who are selling out of their private equity allocations to make space for infrastructure," Waldron said.

While infrastructure investments generally produce more modest returns than private equity investments, they also tend to carry less risk. That is in part because many investments held by infrastructure funds — from data centers to communications tower networks to renewable energy projects — are essential service providers with predictable revenue streams and large bases of physical assets that are expensive to replace, all qualities that Waldron said insulate against economic jolts, like the post-pandemic spike in inflation.

Overlap with PE

Core strategies pursue the safest bets in infrastructure, but slightly riskier core-plus and value-add strategies attracted the majority of private infrastructure capital raised in 2025.

Returns from core-plus and value-add strategies are more dependent on future growth trends and the ability of the fund manager to execute a value-creation plan, and these strategies are much more likely to target investments that also attract interest from private equity funds, Burnett said.

"You're seeing much more overlap today between infrastructure and PE in the growth sectors, like data, telecom and renewable power and distributed generation," he said.

Private equity investment in data centers totaled $45.70 billion in 2025, the highest total in at least five years. Burnett said a typical global infrastructure fund's exposure to digital infrastructure — including data centers, fiber optic cable and communication towers — has gone to 25%–30% from just 5% within the last decade.

"You need to be very aware of the sector concentration that you may end up with [in digital infrastructure] because it's such a high-growth sector, because it has attracted capital from multiple places of the portfolio: real estate, infrastructure, PE. You need to be mindful of your sector exposure," he said.

Different infrastructure strategies

Waldron of Northleaf Capital Partners said even when private equity and private infrastructure fund managers invest behind the same themes, like the digital infrastructure build-out, they approach from very different angles. Infrastructure fund managers prioritize downside protection and capital security.

"That's very different than how a private equity firm would lean into that, where for them it's all about growth, entering new markets, creating new products," he said.

The key for LPs exposed to digital infrastructure through both asset classes is to understand the potential rewards and pitfalls of those very different approaches.

"You just need to be really sophisticated as an LP of assessing risk," Waldron said.

With Intelligence is a part of S&P Global Market Intelligence.