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Infrastructure emerging managers: Cultivating the next generation

Infrastructure emerging managers deserve an allocation in your portfolio. Invest in partners for life today to obtain exposure to differentiated deal flow, enhanced alpha potential, and stronger GP-LP alignment.

Key takeaways

Emerging managers can provide numerous portfolio benefits including differentiated opportunities to obtain alpha, stronger alignment of incentives, and building early relationships with high-potential teams.

  • Attractive opportunity set

    Infrastructure fund sizes have shifted upmarket in recent years, creating space for specialized, smaller managers to target niche opportunities.

  • Portfolio benefits

    Emerging managers can provide complementary exposure to more established managers, providing portfolio diversification through differentiated deal flow and enhancing alpha potential.

  • Alignment and access

    Backing emerging managers early may offer stronger GP-LP alignment, favorable terms for investors, and access to co-investment deal flow that is harder to obtain from large- and mega-cap funds.

  • Complex implementation

    Investing in emerging managers demands uniquely strong sourcing and underwriting, ample resources, and experience to support tomorrow’s leading investors.

Rows of young green plants sprout from dark soil

Navigating implementation

Investing in emerging managers requires disciplined underwriting and specialist expertise to identify the top-performing platforms.

Diagram on navigating implementation
A bar chart on performance of private infrastructure funds by manager type and strategy
Source

The figures shown relate to past performance. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy.
Source: BlackRock, as of September 2025. 1) BlackRock, as of August 2025. Emerging managers categorized as fund vintages I-III and targeting under USD 2bn in fund size. Performance reflects Gross IRR as of March 31, 2025, in USD terms. Note: N=79 and represents infrastructure equity funds screened by BlackRock. Recent investments are excluded as performance is not yet meaningful. 2) Preqin, as of August 2025. Performance reflects Net IRR based on latest available reporting. Note: N=239. Analysis excludes the 15 highest and 15 lowest outliers and any datapoints without listed Net IRR figures.

Potential for outperformance

While dispersion is wider for emerging managers and sector specialists, there is greater potential for differentiated alpha generation.

Higher average performance
Emerging managers have higher average performance than more established managers, but have greater variability in outcomes.

Sector specialists
Emerging managers often pursue sector-specialised strategies, while larger platforms tend to pursue multi-sector and diversified strategies.

Invest in partners for life

Plant seeds. The universe of infrastructure emerging managers is growing quickly. Investors who invest now can secure a first-mover advantage, access to differentiated deal flows and long-term partnerships with future industry leaders.

Branch out. Emerging managers may specialize in specific regions and sectors, investing in niche transactions that fall below the radar of more established platforms. This creates access to deals that are both differentiated and difficult to replicate.

Harvest Value. Access to a comprehensive and global GP network is necessary to identify the most attractive emerging manager opportunities and ensure downside mitigation by selecting managers with proven execution capabilities and strong organizational management.

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