PM Images Introduction It's time to talk about a very important topic: infrastructure investing. While I went with a very catchy title, it's not clickbait, as infrastructure investing has become a favorite of some of the wealthiest investors and funds in the world. In March, the Financial Times wrote an in-depth article titled "Infrastructure: from investment backwater to a $1tn asset class.
" In 2006, global infrastructure was an asset class of roughly $80B. Last year, that number was $1.3 trillion.
That's a CAGR of 17.8%! Financial Times Initially, infrastructure investing was mainly for smaller projects, utilities, and municipal bankers. Now, it has turned into one of the largest investment areas, which attracts some of the biggest asset managers in the world.
Today’s infrastructure market is more crowded. The success of entities such as Stonepeak and GIP, along with a decade of rock-bottom borrowing costs , prompted asset managers like BlackRock, CVC and General Atlantic to enter the fray by acquiring large infrastructure managers. A further wave of deals is brewing , according to bankers and private equity executives.
Once an investment backwater, infrastructure became a favoured area for pension funds looking for yield and protection against market volatility . Infrastructure assets under management worldwide have soared beyond $1tn, more than six times their level in 2008, according to data provider Preqin. - Financial Times (emphasis added) More recently, on June 6, .