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Laxman Pai, Opalesque Asia:

While global institutions remain under-allocated to infrastructure, the pace of investments in this asset class is expected to accelerate in the coming years due to growing target allocations and positive investor sentiment, according to a survey.

Despite institutions' under-allocation to infrastructure, 2023 was the most challenging year for private infrastructure fundraising since 2015, according to the second annual Institutional Infrastructure Allocations Monitor released today by Hodes Weill & Associates and Cornell University's Program in Infrastructure Policy.

However, in light of growing target allocations to infrastructure and positive investor sentiment, the pace of annual investments is expected to accelerate over the medium term.

Globally, institutions are under-invested in infrastructure by an average of 123 basis points versus target allocations. Over the past 12 months, the gap between actual and target allocations narrowed, as actual allocations grew faster than targets among repeat respondents.

Over the past 12 months, institutions increased their target allocations to infrastructure by an average of 42 basis points to 5.50%.

Amidst a backdrop of a higher-for-longer interest rate environment, heightened inflation, and global decoupling in the face of deglobalization, institutions largely spent the last 12 months on the sidelines, focused on managing their existing portfolios and waiting for valuations to find a ......................

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