Before the global financial crisis (GFC), traditional banks were responsible for nearly 90 percent of infrastructure debt finance. But regulations issued in the wake of the crisis limited the ability of banks to provide these loans, notably for longer term financings. Private placements or municipal bonds also have played an important role in financing infrastructure investments in the United States, but they have focused on investment-grade assets. After the GFC, managers began offering a variety of options for investors to access both investment-grade and non-investment-grade unlisted infrastructure debt with the potential for attractive returns.

Infrastructure mega-funds — those funds raising $2 billion or more — have been responsible for most of the capital raised each year since 2012 — and this trend shows no sign of ending. In fact, it might even be accelerating. In the past three-plus years ending March 15, 2018, 88 funds closed with an aggregate total of $171.2 billion raised. Of that total, 30 mega-funds, or 34 percent of the total number of closed funds, have raised $127.1 billion, or 74 percent of the capital.

The infrastructure plan issued by the White House launches an essential public discussion of how to rebuild America’s crumbling infrastructure in a timely fashion. Streamlining permitting is vital, and the White House rightly features it prominently in the plan. The challenge, as it relates to streamlining, is to align the permitting process with the need to modernize America’s decrepit infrastructure.