Exclusive—Stonepeak Partners Wants Up to $20 Billion in Infrastructure Funding in North America – Sources

The fundraising plans underscore strong investor demand for infrastructure assets, whose inflation-linked cash flows provide a shield against rising prices. Stonepeak raised $14 billion for such a fund just nine months ago. Private equity funds of this size typically allow at least a few years enough time to deploy their capital.

Stonepeak has begun reaching out to investors to gauge their interest in the fund’s expected launch next year, the sources said, speaking on condition of anonymity because the matter is confidential.

A Stonepeak spokeswoman declined to comment.

Infrastructure funds, including Stonepeak, raised more than $50 billion in the second quarter of this year alone, up 25% from a year earlier, underscoring strong demand from institutional investors, according to data provider Preqin.

The Oregon Public Employees Retirement Fund (PERS) said its predecessor fund, Stonepeak Infrastructure Fund IV, returned 1.08 times its investors’ money at the end of June of this year, which pledged $500 million. Private equity funds typically take a few years to show returns when they invest the money they raise.

The previous $7.2 billion Stonepeak Infrastructure Fund III, raised in 2018, returned 1.59 times cash from its investors, PERS data show.

Stonepeak has begun raising its first global “core” infrastructure fund with an initial target of $5 billion, and the company aims to close its first fundraise by the end of the year, sources said.

Unlike Stonepeak’s North American funds, which have a fixed tenure — Fund IV has a 12-year tenure with an option to extend by three years — the principal fund is open-ended, the sources said. The Core Fund seeks to invest in infrastructure assets that generate inflation-linked returns based on long-term contracts. It will invest in assets in Organization for Economic Co-operation and Development (OECD) member countries in sectors such as transport, communications and utilities.

Some of Stonepeak’s recent investments include a $2.4 billion deal to acquire Intrado’s emergency call services and a 36% stake in Colorado-based data center provider CoreSite for more than $3 billion. Stonepeak agreed to buy its first Australian investment on Sunday, along with pension fund Spirit Super, in a deal valued at A$1.1 billion ($732 million), sources told Reuters.

Stonepeak was founded in 2011 by former Blackstone Inc. executives Michael Dorrell and Trent Vichy. The New York-based firm has approximately $52 billion in assets under management across the United States, Europe, Asia and Australia.