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Intense competition, high valuations and regulatory uncertainty have led SWFs to shift from infrastructure to public equities – at least in developed markets, a new report finds.

The firm has already started investing capital from Fund III, after bumping up its hard-cap to accommodate last-minute commitments.

The deal would give the duo a weighty PFI portfolio, while capping off a challenging 12 months for the listed fund.

The $351bn pension fund’s results in the asset class exceeded the benchmark by 14.16 percentage points.

The Global Energy and Power Infrastructure Fund III has a $3.5bn target and is the first launched by the former First Reserve team following its acquisition.

The world’s largest pension pledges to keep building its alternatives portfolio – mostly made up of infrastructure at the moment – at a ‘stable pace’, as it eyes a 5% target.

The firm expects its third infrastructure vehicle to raise about $7bn later this year, boosting management fees from the asset class by $80m.

The new offering has raised €1bn more than its initial target, with the next round of fundraising expected later this year or early next, EMEA head Leigh Harrison tells Infrastructure Investor.

The investment was made on behalf of an Australian LP and a new European client.

This is the second best first-half performance since 2012, with an extra $9bn raised compared with last year – discounting GIP III – as fund sizes continue to grow.