Institutional investors remain strongly committed to infrastructure allocations, but they are becoming significantly more selective about how and where they deploy capital, according to a new asset owner survey from independent global investment consultancy Bfinance.
Based on more than 40 conversations with investors representing approximately US$2.3trn (€2trn) in assets, the research suggests that infrastructure markets are entering a more mature phase, with investors refining their strategies rather than retreating from the asset class.
Bfinance said the survey data revealed that the “centre of gravity for infrastructure allocations has shifted away from core” investments, with core-plus and value-add strategies now performing as “the workhorses of asset owners’ infrastructure portfolios, offering what many describe as the best risk-reward efficiency”, particularly in sectors like energy transition, power, digital connectivity and transport.
However, investors are keen to avoid drifting into private equity-style risk profiles in their infrastructure portfolios. The survey finds a decline in tolerance for ‘greenfield’ asset exposure in favour of brownfield platforms with embedded growth opportunities.
Investors have become markedly more cautious toward development-stage projects, and many pointed to the same sources of discomfort: prolonged permit-gathering timelines, supply-chain volatility, inflation-driven cost uncertainty and recent first-hand anecdotal experiences with projects that ran over budget or schedule.
The survey was conducted before the start of the Iran conflict, but Bfinance said an increasingly volatile macroeconomic and geopolitical environment was at the forefront of investors’ thinking during survey interviews, shaping strategic repositioning.
Some 27% of investors named geopolitics as their number one concern for the asset class, citing tariffs, immigration, energy security and US-China decoupling, while 18% selected the risk of an AI bubble.
Inflation/interest rates was another popular choice (18%), as was regulation. Only 9% chose climate risk, which Bfinance said illustrated the shift in sentiment since the end of the previous decade “due to the immediacy of current issues facing even long-term investors”.
Europe is viewed by many participants as steadier from a regulatory and political perspective, while US exposure now carries heightened board‑level scrutiny, despite some investors seeing opportunities for better valuation resets, particularly in the energy transition space.
Anish Butani, managing director and head of infrastructure at Bfinance, said: “The sentiment that emerges from this study is clear. Investors are confident in the long-term role of the infrastructure asset class, but they are more selective about how and where they take risk, more attuned to macro forces, and more cautious in how they structure portfolios and relationships.
“This is not a retreat from infrastructure – it is a refinement. Disciplined conviction and alignment of interest must replace blanket optimism and bullish messaging. A market once defined by enthusiasm must now be defined by experience.”
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