Global Energy & Power Infrastructure Fund III (GEPIF III), a BlackRock Real Assets power and energy infrastructure fund, has secured $1.5 billion in commitments from prominent institutional investors in North America, Middle East, Europe and Asia, subject to certain post-closing conditions.
GEPIF III focuses on equity investments in the mid-market energy and power infrastructure value chain, operating mainly in the developed countries.
The GEPIF III team seeks to invest in energy infrastructure projects that will generate current income and long-term capital appreciation and have cash flows with a general positive correlation to inflation, which can enhance long-term returns.
“As the world undergoes a structural shift in how it powers industry, homes and transportation, there is significant need for new energy infrastructure and the capital to finance it. Our core philosophy has always been to make investments that we believe minimize risk and promote capital preservation, while providing an opportunity to enhance an asset or expand a business,” said Mark Florian, head of BlackRock’s global energy and power infrastructure team, in a media statement.
According to BlackRock’s 2018 Global Rebalancing Survey, more than 60 percent of institutional investors intend to increase their total allocation to real assets this year, more than any other asset class.
“The strength of our energy and power franchise enhances our ability to provide clients with comprehensive solutions as alternatives play an increasingly important role in their portfolios,” said Jim Barry, Global Head of BlackRock Real Assets.
Funding in the energy sector has been gradually increasing. Per Mercom’s Q2 2018 Solar Funding and M&A Report, In the first half (1H) of 2018, the total corporate funding, including venture capital funding, public market, and debt financing rose to $5.3 billion, compared to the $4.6 billion raised in 1H 2017. This implies a 15 percent increase year-over-year (YoY).