Key takeaways
- 2025 posted the highest deal volumes for infrastructure in history:
- Overall infrastructure deal volume increased to $1.56tn, up from $1.12tn in 2024 (+39% YoY).
- Infrastructure debt deal volume increased to $1.05tn, up from $790bn in 2024 (+33% YoY).
- Prior to 2025, the highest infrastructure deal volume was in 2022 with $1.26tn (overall) and $603bn (debt).
- Infrastructure debt funds represent only 8.1% of infrastructure AUM (as of Q1 2025) which is expected to present abundant opportunities for dedicated credit managers given approximately $322bn of infrastructure equity dry powder remained as of YE 2025.
- The continued public infrastructure funding deficits and high levels of dry powder in private equity indicate continued heightened levels of activity in 2026 for both private infrastructure equity and debt investors.
- Sustained demand for artificial intelligence (AI) capacity is expected to continue to drive growth in data centers, power supply, and fiber.
- Acceleration of capital deployment driven by grid modernization, energy security, and industrial onshoring.
- Urbanization driving need for social infrastructure investment in developed and emerging markets.
- Continued growth of private capital and the emergence of asset backed finance as a receptive market for infrastructure execution.
Sector outlook summary
Source: Infralogic, Preqin, and Principal Asset Management, January 2026.
- 2025 was a robust year in private infrastructure with $1.56tn in global activity driven by significant activity in the power and digital sectors, noting all major sectors were up YoY.
- Total global infrastructure debt volumes reached $1.05tn in 2025 with an 80/20 split across bank loans and capital markets (vs. 85/15 split in 2024).
- Investment grade (IG) opportunities continued to see significant activity while attractive high yield (HY) opportunities continued to expand for institutional investors. Infrastructure debt maintained a strong premium to public comparables while offering spreads of +200-250 bps for IG issuances, +325-400 bps for BB issuances, and +425-650 bps in low BB and single B issuances.
- Infrastructure equity investment continued to see high volumes; approximately $510bn (33%) of total global volumes.
- Infrastructure equity deal flow was largest in core and core-plus strategies, while fundraising was most successful in opportunistic strategics – showing investor appetite for different types of risk-return profiles across the asset class.
We believe private capital will expand across risk spectrum in infrastructure
- As deal flow increases in 2026 across IG, HY, and equity opportunities, we expect clients to have increased capital allocation appetite towards HY and selective emerging markets.
- As project costs and project valuations continue to rise, there will be a greater need for borrowers to seek out a variety of capital solutions to bridge the funding gap.
- We believe well structured private capital HY transactions currently provide some of the most attractive risk-adjusted returns. These transactions back mission critical infrastructure assets, with resilient valuations, and are expected to continue to provide opportunities in 2026.
- Megatrends across AI and data consumption, digitalization, grid modernization, energy security, urbanization, and the emergence of new asset backed financing structures.
- We expect corporates and financial sponsors to continue seeking innovative financing solutions in the private markets that require bespoke structured solutions for capital intensive projects.
- Government deficits are expected to continue to widen the “infrastructure gap” globally, furthering the need for access to flexible private capital.
Read our full outlook for more insights, including our individual sector outlooks.
Risk Considerations
Past performance is no guarantee of future results and should not be relied upon to make an investment decision. Investing involves risk, including possible loss of principal. Infrastructure companies may be subject to a variety of factors that may adversely affect their business, including high interest costs, high leverage, regulation costs, economic slowdown, surplus capacity, increased competition, lack of fuel availability, and energy conservation policies. Infrastructure companies may also be subject to regulation by various governmental authorities and may also be affected by governmental regulation of rates charged to customers, operational or other mishaps, tariffs and changes in tax laws, regulatory policies and accounting standards. Strategies that concentrate investments in specific industries, sectors, markets or asset classes may underperform or be more volatile than other industries, sectors, markets or asset classes and then the general securities market.
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