Partners Group's Infrastructure Secondaries Strategy: Capturing Energy Transition Gains in a Crowded Market

The infrastructure investment landscape is increasingly crowded, but Partners Group has carved out a niche by focusing on mid-market opportunities and energy transition themes. With a reported net internal rate of return (nIRR) of 20% and a net total value-to-investment (nTVPI) of 2.4x from recent exits, the firm's secondaries strategy is proving that smaller, under-the-radar deals can deliver outsized returns. As the energy transition accelerates and institutional demand for infrastructure grows, now may be the time to act before rising competition narrows the opportunity gap.

The Performance Case: 20% nIRR and 2.4x nTVPI Backed by Strategic Exits

Partners Group's infrastructure secondaries team has consistently outperformed by targeting exits in North American and European energy infrastructure. Recent results from four full exits—three with LS Power's power generation and grid projects and one in an independent power producer—highlight the strategy's focus on “direct-like underwriting.” This approach allows the firm to assess asset valuations and future cash flows with the precision typically reserved for direct investments, even in secondary transactions.

The 20% nIRR and 2.4x nTVPI figures, while based on pro forma calculations, reflect exits with an average holding period of under five years—a testament to the team's ability to time exits strategically. Crucially, these returns are net of fees, including management expenses and performance allocations, making them a strong risk-adjusted benchmark.

Mid-Market: The Sweet Spot for Non-Competitive Deals

While large infrastructure deals often attract institutional bidding wars, Partners Group's focus on mid-market assets—typically between $100 million and $1 billion in value—provides two critical advantages. First, mid-market sellers often lack the resources to navigate complex sales processes, creating opportunities for buyers like Partners Group that can move quickly and offer liquidity. Second, these deals frequently fall outside the radar of larger private equity firms, allowing Partners Group to act as a price setter rather than a price taker.

The firm's Infrastructure Partnership Investments team, led by Dr. Dmitriy Antropov, has executed over 60 such transactions since 2006. Their ability to secure deals like LS Power's ~13 GW power generation portfolio and a ~6 GW distributed energy platform—both exited in 2025—demonstrates the strategy's consistency. These deals not only delivered the cited returns but also exemplify the team's knack for identifying assets with embedded operational upside.

Energy Transition: A Tailwind That Won't Fade

The energy transition is a multi-decade theme, and Partners Group is positioning itself as a leader in the space. Its recent exits in power generation and grid infrastructure align with a global shift toward decarbonization. For instance, the sale of the Greenlink Interconnector—a subsea electricity grid project—highlighted the firm's long-term value creation philosophy. Purchased in 2019 and fully owned by 2021, the asset was sold for over €1 billion in 2024, underscoring the strategy's 10-year investment horizon.

The broader infrastructure sector is also benefiting from secular tailwinds. Governments worldwide are investing in grid modernization and renewable energy, while aging infrastructure in developed markets creates replacement demand. Partners Group's focus on “flexible energy” assets—such as distributed generation and storage—positions it to capitalize on these trends before they become mainstream.

The Investment Thesis: Act Before the Crowd Catches Up

The secondaries market is expanding rapidly. Partners Group estimates it could grow from $15 billion to $60 billion over five years, driven by maturing infrastructure funds and LPs seeking liquidity. However, this growth may soon compress returns as more capital chases the same deals.

Investors should consider Partners Group's strategy now for three reasons:
1. Access to Non-Competitive Deals: The firm's relationships with mid-market sellers and GP-led sponsors allow it to secure deals before they enter competitive auctions.
2. Thematic Alignment: Energy transition assets are still underappreciated in public markets but are critical to decarbonization goals.
3. Speed of Capital Return: With an average return of initial capital within five years, the strategy offers liquidity relative to traditional private equity.

Risks and Considerations

No strategy is without risk. Partners Group's returns are based on near-fully realized transactions, and future performance could vary due to market conditions or operational execution. Additionally, the energy transition's pace depends on policy and technological advancements, which remain uncertain. Investors should conduct due diligence on the firm's fund structures and fee arrangements.

Final Take: A Proven Model in a Transforming Market

Partners Group's secondaries strategy is a case study in value investing. By focusing on mid-market energy infrastructure and avoiding crowded auctions, it has delivered returns that outpace broader market indices. With the energy transition still in its early stages and institutional demand rising, now is the time to secure access to this strategy before its alpha narrows. For investors seeking risk-adjusted returns in a sector with long-term growth, this is a playbook worth following.

The path to infrastructure investing is crowded, but the right secondaries partner can turn that crowd into an advantage. Partners Group's proven model shows how.

This analysis is for informational purposes only and should not be considered investment advice. Always consult a financial advisor before making investment decisions.