The infrastructure market is expected to remain under pressure from the new interest rate environment, but infrastructure has absorbed higher rates well in comparison to other asset classes, according to DWS in its 2024 outlook.
Given strong cash generation and expectations for rates to fall to more manageable levels, DWS does not expect major repricing in the unlisted infrastructure market.
The infrastructure market has begun to stabilize, and 2024 should see a return to stronger fundraising and transaction activity. With economic conditions still challenging, it will remain important for assets to demonstrate downside protection as well as the ability to quickly adapt to prevailing economic conditions.
The midmarket opportunity set remains compelling given the ready pool of large-cap investors needing to deploy capital into new assets, as well as the higher returns on offer. While DWS believes that the energy transition and digitalization will remain two of th