How to invest in infrastructure
Infrastructure is emerging as one of the best performing themes in 2025
Enterprise Products Partners L.P. (NYSE:EPD) cryogenic natural gas processing plant at Yoakum, Texas (Eagle Ford Shale). This facility has a design capacity of 300 million cubic feet per day and can extract approximately 37,000 barrels per day of natural gas liquids. Photo by Kirill Pyshkin.
First of all, I wanted to thank WealthBriefing for featuring my investment views on this topic among those of the industry’s stalwarts’ Goldman Sachs, Edmond de Rothschild and Indosuez Wealth Management. You can read the full article here.
Our infrastructure portfolio is up over 12% in USD this year, it is the best performer among our 10 investment themes. Infrastructure, and especially European assets, are becoming even more attractive with the landmark German push to create a €500Bn special fund to finance infrastructure projects outside of normal budgetary spending.
Why invest in infrastructure
Infrastructure is a foundational sector that supports economic activity and global development. With massive investment needs, government backing, and alignment with trends like urbanization, energy transition, and sustainability, it offers a combination of growth potential, income stability, and inflation protection—making it a strong and resilient investment theme.
Figure: Infrastructure investments by sector
Source: https://outlook.gihub.org
Here’s why this is an attractive investment theme:
1. Global Infrastructure Deficit. Many developed economies face ageing infrastructure in need of upgrades, including roads, bridges, water systems, and power grids. Emerging countries require massive infrastructure investments to support population growth, urbanization, and economic development. The global infrastructure investment gap is projected to reach trillions of dollars by 2040, creating significant opportunities.
2. Government Spending and Stimulus. Governments worldwide are increasing infrastructure spending to stimulate economic growth, especially post-COVID-19. Examples include: The U.S. Infrastructure Investment and Jobs Act ($1.2 trillion) focused on transportation, energy, and broadband. Major initiatives in Europe, China, and India to build renewable energy systems, high-speed rail, and smart cities. Public-private partnerships (PPPs) further drive investment in this space.
3. Energy Transition and Climate Resilience.
Renewable Energy: Investments in wind, solar, and hydroelectric power infrastructure are growing as countries aim for net-zero carbon emissions.
Grid Modernization: Ageing power grids are being updated to support renewable energy, electric vehicles, and battery storage systems.
Climate Resilience: Infrastructure projects are increasingly focused on protecting against natural disasters, rising sea levels, and extreme weather events.
4. Urbanization and Population Growth. By 2050, an estimated 68% of the global population will live in cities, requiring significant upgrades to transportation systems, housing, water supply, and waste management. Smart city initiatives combine technology and infrastructure to improve urban living, creating opportunities in IoT, data centres, and digital infrastructure.
5. Transportation Modernisation.
Public Transit: High-speed rail, subways, and bus rapid transit systems are expanding globally to reduce congestion and emissions.
Electrification: The rise of electric vehicles (EVs) requires charging networks and supporting infrastructure.
Airports and Ports: Growing global trade and travel demand lead to investments in airport expansions and port modernization.
6. Digital Infrastructure and Technological Innovation.
5G and Broadband Expansion: As connectivity becomes a necessity, investments in 5G networks, fibre optic cables, and data centres are skyrocketing.
Cloud Computing: Data centre infrastructure is critical to support the digital economy, driving demand for sustainable, scalable facilities.
Smart Infrastructure: IoT, AI, and automation are transforming traditional infrastructure, making it more efficient, cost-effective, and environmentally friendly.
Construction Tech: Technologies like 3D printing, modular construction, and advanced materials are reducing costs and speeding up project completion.
7. Steady and Recurring Income. Infrastructure investments often provide stable, long-term cash flows due to contracts, government funding, or regulated returns. Examples include toll roads, utilities, and airports.These assets are resilient to economic downturns, making them attractive for income-focused investors. These projects often have multi-decade time horizons, ensuring steady demand for infrastructure-related businesses and services.
8. Inflation Hedge. Infrastructure assets often have inflation-linked revenue streams, such as tolls or utility fees. As inflation rises, revenues from these assets typically increase, protecting investors’ purchasing power.
9. Sustainability and ESG Alignment. Infrastructure investment aligns with Environmental, Social, and Governance (ESG) goals, especially in areas like clean energy, water access, and urban sustainability. Green bonds and sustainable finance are increasingly used to fund infrastructure projects.
10. Diversification Benefits. Infrastructure investments are less correlated with traditional equity and bond markets, offering diversification and resilience during market volatility.
Our infrastructure portfolio
Our infrastructure portfolio is doing significantly better than the peer funds that we track because we were much more positive on all European assets at the beginning of the year than most. Even though our peers are trailing behind, all infrastructure funds that we track are in the positive territory.
Our infrastructure portfolio consists of three buckets – Transport & Structures, Information and Communication Technology (ICT) and Energy.
Transport & Structures
Today here we include investment in companies building and operating transport infrastructure such as motorways and airports. We may include other investments related to engineering structures.
ICT
Here we have investment in companies critical for telecommunications networks and data infrastructure. For example, in this bucket we may include telecom operators, companies that manage data centres or operate fabrication facilities critical for ICT.
Energy
We have the largest allocation to the energy infrastructure bucket. Here today we have companies producing or transporting energy, chemical, or industrial gases. Majority of our exposure is in Europe, which is the key to our outperformance this year to date.
Please contact me directly for the pricing information how to access our portfolios.
Disclosure
My articles represent my personal opinions and are provided for information purposes only. Their content is not intended to be an investment advice, or a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. I use information sources which I believe to be reliable, but their accuracy cannot be guaranteed. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors and, if in doubt, an investor should seek advice from a qualified investment advisor.