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Infrastructure

A fast-growing asset class with a strong global growth profile

Infrastructure is one of the fastest growing asset classes globally, with target infrastructure allocations increasing significantly over recent years1. We expect portfolio allocations to infrastructure assets to rise further in coming years as the benefits of investing in infrastructure are increasingly recognised.

There is a significant need for new infrastructure in both developed and developing economies. It is estimated that approximately US$57 trillion needs to be invested in global infrastructure by 20302. This means there will be a broad and growing range of infrastructure investment opportunities.

Learn about our capabilities
  • A$10.3bn* in assets under management
  • Expertise on the ground on four continents
  • More than 25 years of market leadership

Why infrastructure?

In our view, the benefits of this asset class offer a compelling fit for investors seeking a blend of stability and attractive returns.

Low volatility

Low volatility

Infrastructure assets are often regulated and exhibit strong monopolistic qualities with high barriers to entry. These characteristics mean infrastructure assets can be less volatile than traditional asset classes.

Stable, long-term cash flows

Stable, long-term cash flows

Long-duration asset lives may make for stable, long-term cash flows linked to inflation.

Natural diversification

Natural diversification

A range of sub-sectors within infrastructure may offer natural opportunities to build well-diversified portfolios that can perform throughout the economic cycle.

Why AMP Capital?

AMP Capital is a pioneer in infrastructure investment with more than 25 years of leadership in the asset class. We began investing in direct infrastructure in the late 1980s, through finance participation in the Sydney Harbour Tunnel.

Our infrastructure investment team’s capabilities span research, origination and due diligence, transaction execution, asset management and portfolio construction and management.

Be it a petroleum pipeline in Spain, a wind farm in Nebraska or an airport in Australia, AMP Capital clients can access the benefits of infrastructure by investing in listed and unlisted infrastructure equity, providing a gateway into projects that retail investors may typically find difficult to access.

Scale

As one of the leading infrastructure managers, our size, reputation and networks mean we can provide access to innovative investment opportunities across a range of sectors globally. This includes investments in energy, power, transport, utilities, airports, seaports, communications infrastructure and social infrastructure.

Breadth

AMP Capital’s infrastructure team features more than 70 infrastructure investment professionals* across the globe. The infrastructure team has specialist and extensive experience spanning a diverse range of sectors, lifecycles and geographic regions. It also spans the full range of ways to invest in infrastructure, whether it’s through equity or debt, in both listed and unlisted markets.

Information advantage

Our clients may benefit from the information advantage that comes from AMP Capital’s scale and breadth as well as our culture of collaboration across many teams. Our expertise spans infrastructure, real estate, fixed income, equities, multi-asset investing and macro markets. Collaboration between these teams informs our decision-making process.

Why now?

Infrastructure’s low correlation to most other asset classes may help insulate investors from financial market volatility and often offer income streams higher than those typically available in today’s low interest rate environment.

Listed infrastructure securities

Global listed infrastructure companies may offer investors higher dividend or coupon payments than global equities and global bonds, respectively, as operating margins are often high and cash flows are very stable. It may also offer investors a highly liquid way to gain exposure to infrastructure.

Unlisted infrastructure equity

Direct infrastructure investment may provide diversification benefits and attractive risk-adjusted returns as well as low correlation with most other asset classes.

* As of 31 December 2015.

1 2015 Preqin Global Infrastructure Report

2 McKinsey Global Institute, January 2013

We focus on ‘core and pure’ infrastructure assets

We only invest in companies we believe provide a sufficient return for the commensurate risk. Our philosophy is centred around an investment approach which focuses on ‘core and pure’ infrastructure assets. These are companies that own and operate infrastructure assets with no or low exposure to commodity, volume and competition risks. We believe that these assets can provide investors with superior risk-reward characteristics.

What sets us apart

 
In-depth understanding of local market conditions

In-depth understanding of local market conditions

With investment professionals based in Sydney, London and Chicago, our team is close to the major markets and has an in-depth understanding of local market conditions.

Our investment process uses local expertise in a globally integrated approach

Our investment process uses local expertise in a globally integrated approach

Our investment process involves a fundamental bottom-up analysis of both valuation and equity. We use our in-depth knowledge of local markets to apply this analysis, and complement it with an analysis of top-down factors.

Proven history across geographies, lifecycles and sectors

Proven history across geographies, lifecycles and sectors

As one of the first infrastructure investors, we have a long history of infrastructure investing across multiple jurisdictions and sectors, and throughout market cycles.

Culture of collaboration provides an information advantage

Culture of collaboration provides an information advantage

With more than 70 investment professionals across our infrastructure platform, constant communication and information sharing across the team enable us to capitalise on our depth and breadth of coverage.

Risks

Risks specific to infrastructure investments include the risks of investing in share markets, infrastructure and international markets. In addition, the risks associated with interest rates, gearing and the cost of debt, derivatives, investment management, co-ownership of assets, fluctuations in rental income, rental demand and fund termination risks. Please refer to the relevant fund’s Information Memorandum or Product Disclosure Statement for more information.