That's one lesson from BlackRock's purchase of Global Infrastructure Partners.
From The Economist, January 18:
Why BlackRock is betting billions on infrastructure
Demand for investment is soaring thanks to decarbonisation, digitisation and deglobalisation
The global economy is on the cusp of an “infrastructure revolution”, if Larry Fink is to be believed. The boss of BlackRock, the world’s largest asset manager, made the modest prediction shortly after announcing on January 12th that his firm would acquire Global Infrastructure Partners (GIP) for $12.5bn. That company, led by Adebayo Ogunlesi, an old pal of Mr Fink’s from their banking days, is the world’s third-largest infrastructure investor, behind Australia’s Macquarie and Canada’s Brookfield. Its assets range from Gatwick Airport in London to the Port of Melbourne. Mr Ogunlesi and his fellow partners will collectively become BlackRock’s second-largest shareholder.Mr Fink is not the only one excited about the industry. On January 16th General Atlantic, a private-equity (PE) firm, confirmed reports that it would buy Actis, an infrastructure investor focused on emerging markets. In September CVC, another PE firm, announced it was buying DIF, a Dutch infrastructure investor. Over the past decade assets under management in infrastructure funds have increased almost five-fold, to $1.3trn, according to Preqin, a data provider. Pension funds and sovereign-wealth managers have been lured in by the industry’s returns, which are both handsome and relatively stable. More than half of such backers surveyed by Preqin intend to increase the share of their portfolios allocated to infrastructure. Some of the larger among them now invest directly in these dull assets. Why, then, all the excitement?
The infrastructure-investment business took shape in the 1990s and 2000s. Western governments with growing debts began seeking out private investors to acquire—and help rejuvenate—ageing infrastructure from airports and railways to water pipes. Later, a growing assortment of companies from energy suppliers to telecoms operators also turned to infrastructure investors to offload assets such as pipelines and cell towers, observes Sam Pollock, boss of Brookfield’s infrastructure business.
Now demand for infrastructure investment is soaring thanks to three megatrends, explains Mr Pollock. The first is decarbonisation. For the world to meet its climate goals, some $8trn will need to be invested over the remainder of this decade in renewable energy such as solar and wind, as well as batteries to store it and transmission lines to transport it. Hefty investments will also be needed in hydrogen facilities, to produce carbon-free fuel for planes and ships, and in carbon removal. The second megatrend is digitisation. Software may well be eating the world, as a venture capitalist once predicted, but it is relying on an awful lot of physical assets to do it, from fibre-optic cables and 5G networks to data centres. Third, deglobalisation. Efforts to shift supply chains away from China are spurring demand for capital-hungry factories and new transport infrastructure to move goods over land and sea. In Europe concerns about energy security following Russia’s invasion of Ukraine have also provoked a rush to build liquefied-natural-gas terminals to bring in the fuel from less belligerent places....
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