Europe has overtaken North America as the favoured regional destination for private markets investment, according to a new report from IFM Investors.
In a survey of more than 700 senior asset owners and managers, set to be published next week, IFM found that Europe is now their preferred destination when investing in infrastructure equity and debt, private credit and unlisted real estate.
For unlisted real estate, 50% of respondents are prioritising investments on Europe, with 46% looking to North America.
For private debt, excluding infrastructure debt, 52% of respondents said they are prioritising investments in Europe, while 47% said they are focusing on North America.
Half of respondents are prioritising investments in infrastructure debt in Europe in 2025, compared to just over a third (35%) in 2024. IFM’s report added that the number of investors prioritising investment in infrastructure debt in North America is also set to nudge up by 2% to 42% in 2025.
The survey found that more than four in 10 (44%) respondents cite Europe as the preferred destination for infrastructure equity, up from a third (33%) in 2024. Infrastructure equity investment in North America is still set to increase with four in 10 (41%) respondents prioritising investment in the region, compared with 35% in 2024.
Luba Nikulina, chief strategy officer at IFM Investors said the report suggests that Europe’s appeal to global investors not only lies in its mature infrastructure and established regulatory framework, but also in expected fiscal stimulus, increased defence spending, and leadership in the global energy transition.
IFM’s survey found that Europe’s status as a preferred destination is supported by the ramping up of infrastructure spending in the region as investors report abundant high-quality pipeline opportunities, especially in core and core-plus infrastructure equity.
Nikulina said: “Europe’s current appeal is undeniable, especially in sectors like infrastructure, green energy, and industrials. While the US remains a central market for investment and innovation, Europe offers complementary opportunities that are proving highly compelling to global investors.
“To fully benefit from investment opportunities, it’s essential to look across different geographies and sectors. In Europe, we’re seeing increased investment in infrastructure and a growing recognition among policymakers of the need to attract private capital. There’s also a strong ongoing commitment to the energy transition and energy security.”
Nikulina said told IPE Real Assets that infrastructure is particularly interesting because it has experienced the largest jump in expected returns – “up 200 basis points over the past year”.
Nikulina said: “This is a very significant jump, and it’s across the globe, both in North America and Europe. Despite volatility in the market, this asset class has performed, and the growth potential [of this asset class] has come to the forefront.”
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