International fund of funds manager, Hamilton Lane plans to increase its infrastructure allocation for Asia Pacific from 5%-7% to 10% within the next two years, a senior official told Infralogic.

The Conshohocken, Pennsylvania-based investor has historically been underweight on APAC but that is about to change, according to Brent Burnett, Head of Infrastructure and Real Assets at Hamilton Lane.

“We feel better about the opportunity set in Asia today versus 10 years ago, given the region is now beginning to show distributions to paid-in capital,” Burnett said. That, combined with a relatively low geopolitical risk amid uncertainty in the US, will drive the firm to redirect capital.

Hamilton Lane’s infrastructure business was managing and supervising USD 79.8bn in assets as of 31 March 2025, the website shows. It is invested in around 175 infrastructure GPs globally, Burnett said. The firm deploys roughly USD 4bn-USD 6bn in primary funds and about USD 700m-USD 1bn in direct investments each year, he added.

The investor’s infrastructure portfolio is about 60% allocated to North America, 30% to Western Europe, and 10% to Latin America and APAC combined, according to Burnett.

Another reason to allocate more to Asia Pacific is a growing supply of APAC deals. The region, in conjunction with LATAM, contributes 15% to the global transactions market today, he said.

The number of regional funds has been on the rise as well, with APAC allocations jumping from nothing to 20% in the last decade among global managers, he said.

Some funds, including Brookfield Asset Management and I Squared, are raising global emerging markets funds which will invest in Asia, while KKR, Macquarie Asset Management and Stonepeak are raising regional funds.

Consistent with its global strategy, Hamilton Lane expects to deploy 75% of its APAC allocations into funds and invest 25% directly, in co-investments and in secondaries, Burnett said.

The firm employs a three-man team in Hong Kong, Seoul and Singapore to analyze regional infrastructure investments, but Burnett expects Hamilton Lane to hire more people as it invests more in Asia.

Digital, renewables high on agenda

For data centres, the APAC region presents a “much more interesting” destination to deploy capital, Burnett said, citing better yields and similar tenant profiles globally. Cash yields on construction cost range from 6% to 8% in the US and 8%-10% in Europe, while APAC offers 10%-12%, he said.

“With renewables, we believe there is a good predictability around pricing, government support, power purchase agreement rates, and a cost advantage in panel pricing owing to proximity to China,” he said.

By comparison, although the US has seen a growing number of domestic panel manufacturers, the price differential with Chinese producers remains significant, he noted.

Hamilton Lane will consider investing across APAC with a skew to developed markets including Australia, South Korea and Japan, said Burnett. “We will exclude opportunities in mainland China, where it remains hard for US investors to invest.”

Besides regional funds, the firm has direct investments in a pan-Asian data centre platform, Taiwanese renewables, and Australian power, among others, he said, declining to comment on specific funds and companies.

Burnett also expects the Asian secondary market to grow. Earlier this year, the firm acquired existing limited partner stakes in the IMM Infra 8th Private Equity Fund, a core-plus and value-added infrastructure vehicle managed by South Korea’s IMM Investment.