Global opportunities in infrastructure development

In terms of private investment in infrastructure, the volumes raised have increased significantly recently as the scale of the opportunity – both in countries looking to develop projects from scratch and those looking to replace or upgrade ageing facilities – has grown and it’s become apparent that public money alone won’t fund everything required. $120.6 billion of capital was fundraised for infrastructure investment in 2023 – 43% more than at the same point a decade ago. Although, like other types of investment, this volume was down on 2022 levels, the long-term trend upwards in the amount of money being committed to the sector is clear. 

For private investors, the ‘where’ of investing largely depends on risk appetite. Projects in developing countries often offer higher returns to compensate for the usually higher risks involved, whereas those in more established markets may be more secure but offer lower returns, and potentially be more competitively fought over by investors.

Wherever the location, infrastructure investment tends not to be a short-term, nor even a medium-term, play. Returns may not be expected for decades and necessitate active involvement in helping to shepherd projects through the process and to help surmount potential challenges that can arise with political upheaval, during economic cycles, and by climate change. On the upside, big risk could bring big rewards. Alongside the financial returns there is the opportunity to be involved in game-changing projects that deliver significant long-terms gains on a regional or even national level and, in the many cases where infrastructure is involved in the transition to sustainable energy, contribute to an environmental good, or, in the mass delivery of affordable homes, a social good.

For those real estate investors unable or unwilling to get involved in infrastructure projects directly, there are often many other secondary opportunities to invest once they get the green light, from warehouse space delivered near to a new port, to the offices, healthcare, retail and leisure amenities required to support new communities and conurbations.

The need for new or upgraded infrastructure globally is vast, and so are the opportunities for real estate investors, whatever their risk appetite. 

Further information

Contact Paul Tostevin or Connor Chilton

How infrastructure investment brings real-estate opportunities