Institutional Investing in Infrastructure

September 1, 2019: Vol. 12, Number 8

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From the Current Issue

Infrastructure

The global listed infrastructure report: A performance report

The following report reviews highlights of some of the events and trends affecting global listed infrastructure companies in recent months. Global listed infrastructure companies, on average, were down (–0.40 percent) in July using the GLIO Coverage. In comparison, global equities added (0.40 percent). Over the past 12 months, global listed infrastructure added (13.6 percent) compared against (3.5 percent) for global equities.

Infrastructure

Crowdfunding for infrastructure: Getting financial and community buy-in is the future of the art

Successful infrastructure delivery requires community buy-in. That’s why governments and developers pour resources into public meetings and marketing material for new construction projects. When there is no buy-in, new projects can get delayed or stopped altogether from community opposition. And, with a growing gap between available funding and infrastructure needs, these outcomes are risky for any budget. To address this problem, project sponsors in the United States and around the world are tapping into crowdfunding to get literal buy-in, both social and financial, from residents and end-users.

Infrastructure

High hopes: A low-tech adaptation for climate change could be the most disruptive of all

For the past several years, tech disruption and how it will affect infrastructure investing has been a top concern for global infrastructure investors, and while autonomous vehicles, alternative energy, drones and robots are certainly disruptive, it could be a low-tech, long-dated “innovation” that could end up being one of the most disruptive for the current state of the planet.

Infrastructure

Infra fund sizes shrink in second quarter: More funds raise less capital

According to IREI’s FundTracker database, infrastructure investment managers closed nine funds in second quarter 2019, raising nearly $16.3 billion. In second quarter 2018, 15 funds held final closings, raising more than $19 billion. In first quarter 2019, eight funds were closed, raising nearly $21.7 billion.

Infrastructure

The infrastructure opportunity: Investors have many paths for investment

In recent years, the infrastructure asset class has received growing attention from global institutional investors attracted by the prospect of strong risk-adjusted returns, protection against inflation and a low correlation to public markets. The industry has experienced significant growth: annual fundraising in the infrastructure asset class has grown from $18.6 billion in 2009 to $72.2 billion in 2018, according to Pitchbook, reaching an all-time high in total commitments.

Infrastructure

Investors’ renewed energy: Infrastructure investors are seeing new trends and technologies open more opportunity for investment in renewable energy

The way the world looks at energy consumption, production and distribution is changing. Sustainable energy that can help prevent or even reduce the effects of climate change, and other catastrophic environmental events, is being considered more seriously by many of the world’s industrialized nations.

Infrastructure

Star turn: LP-GP collaboration pushes ESG forward

ESG is ready for its close-up. After years of being an obscure acronym, ESG (environmental, social and governance) has become a mainstay of the institutional investor vernacular, with a growing number of managers incorporating ESG principles into their investment processes. As asset managers continue to integrate ESG, the impetus is growing for managers to adopt formal ESG policies.