GLOBAL – Institutional investors are increasingly looking to allocate fresh capital to infrastructure projects, but remain more "conservative" than ever.

According to a study by Preqin, eight unlisted infrastructure funds that held a final close in the fourth quarter of last year raised nearly $12bn (€9bn), with strong interest from institutional investors.

The report also noted that 34 unlisted infrastructure funds closed during 2012, raising $23.2bn in institutional capital, against $22.5bn the year before.

Elliot Bradbrook, manager of infrastructure data at Preqin, said the results showed momentum within the fundraising market, particularly with a further $15.5bn in fresh capital being raised by funds holding an interim close during the year.

"However," he added, "fundraising conditions remain challenging for most infrastructure fund managers going into 2013, with a large number of funds on the road targeting investors that are now considerably more conservative than in the past."

Bradbrook went on to say that, despite this caution, investor appetite remains strong, with 78% of respondents to a recent Preqin infrastructure investor study planning to make investments in the asset class over the next 12 months, while 36% are planning to make multiple fund commitments.

Preqin concluded that infrastructure activity would remain buoyant in 2013, as 137 unlisted infrastructure funds were currently in the market, targeting $84.7bn in investor capital.

A previous Preqin report also showed that institutional investor appetite for infrastructure was on the up, with $14bn raised for unlisted funds in the third quarter of 2012.

At the time, Bradbrook still stressed that the fundraising market was "very congested".

"With investors following a more conservative investment strategy, it is likely many funds will be on the road for an extended period of time before reaching a final close," he said.