Institutional investors refer to fund managers (who are often financial institutions) who have pooled funds that they may manage and invest on behalf of the investors. The examples include Macquarie Infrastructure Group ("MIG"), pension funds and insurance companies.
The primary concern of fund manager in investing in funds is to obtain a return on capital commensurate to the risk of the fund's investment. They are also likely to look to diversify their portfolio in order to get the best returns at a particular level of risk. Different funds would have different investment guidelines and rules.