Unlisted infrastructure equity gave back some of the year’s gains in the final quarter of 2019 as rising bond yields curbed discounted cash flow (DCF) valuations. Despite lower risk premiums, performance also was tempered by flat average revenue growth.

The EDHECinfra Global Unlisted Equity Index fell 2.58 percent to 5,228 points by year end, though that still represents a year-on-year gain of 14.06 percent. The average global infrastructure equity premium is now slightly less than 5 percent, down from 5.5 percent two years ago and 8-9 percent before 2012.

The 16-year duration of the index highlights the exposure of infrastructure companies to interest rate risk. After several quarters of declines, many markets saw long-term rates heading upwards in fourth quarter. Long-term U.K. yields climbed by some 40 basis points, 25 basis points in the United States, more than 50 basis points in the euro zone and 25 to 50 basis points in Australia.

The infrastructure sec