North American Investors Favor Domestic Infrastructure Amid Inflation Risks

North American institutional investors are turning toward domestic private market investments and infrastructure as persistent inflation, geopolitical uncertainty and energy security concerns reshape portfolio strategy, according to a survey by IFM Investors.

Sixty-seven percent of North American respondents said they prefer private-market opportunities in the United States and Canada, while 63% identified inflation among the largest risks to their portfolios, compared with 55% of investors globally, IFM said. The survey polled 700 senior investment professionals across 19 countries.

The results signal that investors are not retreating from private markets but are becoming more selective about risk, geography and the assets they use to support long-term growth. Only 21% of global respondents said their portfolios were designed to perform consistently in all economic conditions, while 9% characterized their portfolios as vulnerable to economic shocks.

Infrastructure emerged as the preferred private markets asset class. Globally, 63% of investors said they expect to increase infrastructure-equity allocations over the next three to five years, narrowly exceeding private equity at 62%. Another 55% plan to increase allocations to infrastructure debt.

Investors cited infrastructure’s connection to long-term themes, including artificial intelligence, digitalization, electrification and energy security. Forty-four percent said they value the asset class for access to structural growth trends, while 42% pointed to stable long-term cash flows and defensive characteristics, according to the report.

Energy-related investments also gained attention. Twenty-eight percent of North American investors identified conventional energy as a leading private-market opportunity, compared with 22% globally. Defense drew support from 25% of North American investors, with interest higher among insurers and wealth managers. Still, 65% of North American respondents said the energy transition would remain a long-term source of attractive private-market opportunities.

“Infrastructure has established a meaningful allocation of its own within North American institutional portfolios,” Andrea Mody, IFM’s head of North America clients and strategy, said.

The survey also found a need for specialized capabilities as portfolios become more complex. Thirty-nine percent of North American investors want more customized investment solutions, while 44% said limited expertise constrains their ability to scale thematic investments