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Infrastructure

Infrastructure

Infrastructure encompasses a diverse range of long-lasting, capital-intensive assets essential for society. This includes communication infrastructure like mobile towers and satellites, utilities such as water and waste management, and transportation hubs like airports, ports, and toll roads. The sector’s formal establishment as an asset class came with the privatization of assets in the 1990s, attracting significant investment from private investors.  

  • Returns: Infrastructure provides consistent income and attractive risk-adjusted returns, often stemming from long-term contracts or regulated income streams. However, these returns can be affected by regulatory changes and political risks.
  • Downside protection: Infrastructure investments often involve long-term contracts, offering resilience to economic volatility and market fluctuations. Nonetheless, these investments are still susceptible to project delays and operational issues.
  • Diversification: Infrastructure historically exhibits low correlation with traditional asset classes like stocks, bonds, and other investments, making it a valuable addition to diversified portfolios. 
  • Inflation protection: Many Infrastructure companies generate revenue indexed to inflation due to their market position, regulation, or existing contracts, offering a hedge against inflationary pressures. However, this protection may lag during sudden inflation spikes. 

Our offering

To learn more about our Infrastructure product suite, please contact your Relationship Manager.

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Risks of investing in private markets

The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. Past performance information presented is not indicative of future performance. The return and costs may increase or decrease as a result of currency fluctuations. 

  • Liquidity Risk - Investors may be unable to dispose of an investment quickly and at a price that’s closely related to recent similar transactions. There is no guarantee of distributions and no established secondary market.
  • Event Risk - A significant event may cause a substantial decline in the market value of all securities. 
  • Long-term Horizon - Investors should expect to be locked-in for the full term of the investment, which is subject to extensions.
  • No Capital Protection - Investors may lose the entirety of invested capital.
  • Unpredictable Cashflows - Capital may be called and distributed at short notice.
  • Economic Conditions - Ability to realise/divest from existing investments depends on market conditions and the regulatory environment.
  • Risk of Forfeiture - Failure to make call payments could result in forfeiture of commitment, including invested capital, without compensation.
  • Default Risk - in the event of default investors risk losing their entire remaining interest in the vehicle and may be subject to legal proceedings to recover unfunded commitments.
  • Reliance on Third-party Management Teams - Underlying investments will be managed by various third-party management teams that will in aggregate determine the eventual returns for the investor.

The risk factors listed above are not exhaustive, always refer to product specific documentation for full details and risk disclosures. 

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