Infrastructure is rapidly growing in popularity amongst institutional investors, though the methodology by which institutions enter the asset class (i.e., type, vehicle, term and arena (public vs. private) is far from standardized. Institutional-quality infrastructure assets come in many shapes and sizes, including transportation (e.g., bridges, toll roads, ports and airports); electric and water utilities (e.g., power generation, transmission and distribution); energy (e.g., crude oil and natural gas gathering, transportation and distribution systems); and telecommunications.

Infrastructure investing may provide a number of tangible benefits for institutional investors:

  • Attractive Risk-Adjusted Returns, with a large portion of total return from current income
  • Capital Preservation, given the fact that many infrastructure assets enjoy inelastic demand
  • Portfolio Diversification, given low or negative return correlations to other asset classes
  • High Barriers to Competitive Entry, as many assets enjoy near-to-fully monopolistic positions
  • Inflation Hedge, as many assets feature top-line revenue growth tied to some measure of inflation
  • Solid Matching of Longer-Term Assets to Longer-Term Liabilities

Based on the particular needs of a client, Courtland can tailor a strategy to provide investors with an effective, reasonable approach to investing in infrastructure. For more information, please contact a member of our Infrastructure Team.