Understanding future opportunities in North American infrastructure
At a glance
2018 was a record year in global private infrastructure investing, with USD532 billion raised globally, a 16 percent increase over 2017. The US remained the number one market by a significant margin, with Canada ranked sixth. Collectively, the US and Canada account for 21 percent of the global market. Additionally, refinancing of existing infrastructure also reached a record high of USD81 billion, USD10 billion higher than in 2017, again with the US being the largest market.
There is continued positivity in the market regarding the economic outlook, especially in the M&A and brownfield sectors.
One key area for growth is power generation particularly in renewables, pipelines and the wider midstream as well as in the ports and telecoms sectors.
There is continued positivity in the market regarding the economic outlook, especially in the M&A and brownfield sectors. One key area for growth is power generation particularly in renewables, pipelines and the wider midstream as well as in the ports and telecoms sectors.
Another significant trend is the push to broaden the definition of infrastructure, to include private investment in agriculture and airports. The ‘creation’ of new asset classes is seen as having significant upside, but it would require secure and renewable contracts, diverse and locked in customer bases, growth potential with technology de-risking, and a link to traditional lower risk infrastructure.
GHD Advisory’s Susie Henderson brought her considerable experience in smart cities, urban development, transport and resources to lead a panel on ‘Infrastructure Goes Digital’ at the recent Infrastructure Investors Forum in New York. The panel featured industry experts in areas such as data and telecoms who noted a competitive market for digital investing over a long-term horizon, with large amounts of capital looking to take a position for future growth, especially on lower risks and complementary opportunities, currently driving prices upwards and returns down.
The panel highlighted the rollout of 5G technology across the US as an exciting development and a catalyst for increased interest; however it was recognized that there is potential for overcrowding the market based on future growth projections, a highly sensitive issue for critical US infrastructure.
Data storage, smart cities and new technologies as well as renewable energy investments are all in vogue. We are helping clients’ to determine viable options, evaluate them, understand risk and ultimately provide robust and strategic advice to guide our clients investment decisions