AUM for European infrastructure funds rises to €29 billion

Assets under management (AUM) in the infrastructure sector increased 10.9 percent to €29 billion in the first half of 2022, reflecting the growing interest in the sector among European investors.

According to Cerulli's European July product trend update, the sector has thus been one of the few regions of the European market to record asset growth during the first half of this year.

The increase occurs as investors seek safety from rising inflation, with annual inflation in the Euro area reaching a record 8.6% in June, up from 8.1 percent in May.

Utilities, highways and rail tracks, airport services, marine ports, oil and gas storage, and transportation were all included in these infrastructure investments.

According to Cerulli's report, infrastructure frequently acts as a hedge against price increases, especially when businesses are able to renegotiate contracts and pass costs along to customers.

This is currently being strengthened by strong national encouragement to increase infrastructure investment, as seen in the expansion of Swiss rail transport and the UK's Infrastructure Bank's internal capacity.

Cerulli anticipates that the €29 billion market will expand again this year.

Contrarily, traditional fund sectors experienced significant drops in AUM, including global large-cap equity (down 25%) and global emerging markets equity (down 17%).

Additionally, the AUM for the technology equity sector was significantly reduced by 39%.

Infrastructure equity funds were among the few segments of the European market to record asset growth during the first half of 2022, according to Fabrizio Zumbo, director at Cerulli.

"The intersection of infrastructure and sustainability will also continue to represent a major opportunity as economies globally seek to address the need for greater investment in a greener future."

By fLEXI tEAM