Infrastructure: Investment for the future
An investment in infrastructure is an investment in the future drivers of economic and financial performance. In fact, the global infrastructure investment requirement up to 2040 is estimated at 94 trillion US dollars across the energy, communications, transport and water sectors.1
We urgently need better energy grids, railways services, and more digitalization. And the lack of modern infrastructure is something many of us experience every day.
Given the strains on public finances in many locations, the huge investment needs for infrastructure require more private capital to bridge the gap – meaning this asset class could be an attractive diversifier for the long-term portfolios of some retail clients as well.
What are infrastructure investments?
From data centres, solar farms, and green hydrogen production to hybrid trains, roads, a super sewer and an interconnector – we are invested in many projects and companies to improve today´s infrastructure and be ready for tomorrow.
Infrastructure investments are a form of "real assets" that are crucial to a country's development and often provide essential services to the public such as train services, roads, solar farms, utilities or fibre networks. They cover spending on new transport construction and the improvement of existing networks projects among other things and can support the decarbonization of many projects and companies. And at Allianz Global Investors, our investments in this sector are helping to build tomorrow’s infrastructure.
Take a look at the film to find out more.
Making the right calls
Investing in infrastructure requires a long-term view: hence long-standing experience, reliable partnerships, while being innovative to anticipate future trends and risks are key.
At Allianz Global Investors, we’ve been investing in infrastructure since 2008 on behalf of Allianz and other large institutional investors, so we know the critical role it plays in shaping the future. In that time, we’ve made over 200 investments across 6 continents and have over EUR 50bn assets 2 under management around the world. With that we have built a reputation as a trusted partner for managing complex infrastructure projects.
So, with our scale, heritage and experience, we’re strongly positioned to identify opportunities that offer meaningful returns.
Why invest with us?
Investments can be a big commitment, so it’s important to feel like you’ve made the right one. We understand – with long-standing experience since 2008, we’ve become a leader in the sector, so we have a keen insight into long-term trends and how to manage an asset across several economic cycles. And solutions like our new European Long-Term Investment Fund (ELTIF) provide investors access to the whole infrastructure universe, within one fund.
- Strong ESG and sustainability mind-set
- Expertise and long-standing experience and access to unique opportunities around the world
- Long-term view as we invest on behalf of institutional companies such as insurance companies, or pension funds
- Innovative and forward-looking mindset is needed to identify today the best opportunities for tomorrow
With infrastructure you can invest twice – in your own wealth provision and in the more sustainable infrastructure of tomorrow.
Trends to watch out for
When investing in infrastructure, you should always consider: Digitalization, Decarbonization and Demographic change. Simply put, they talk to how we can make infrastructure more renewable, sustainable, and how we can tackle the demographic challenges many countries will be facing soon.
An investment in infrastructure is an investment in your daily life and the future. And we expect to see more opportunities in this sector for investment that help drive the energy transition, digitalization and transport.
We’ve written a handy introduction, which you can read here.
Discover our investable themes
Navigating Rates
A dynamic approach is required as investors adapt to shifting interest rates, inflation expectations and exchange rates. Volatility will likely persist: while we expect monetary policy to become gradually less restrictive than in recent times, higher rates will likely uncover weak points as industries feel the impact of elevated borrowing costs. Visibility of how markets will develop remains limited, even in the short term, and expectations could be upended. But we are confident this environment also creates opportunities.
Diversification is key – across public and private markets – and we have the ideas and expertise to navigate the complexity.
Embracing Disruption
We think it’s time to recast traditional definitions of “disruption”. Once a story for the tech sector, disruption is now all-encompassing as artificial intelligence and other transformative technologies are used widely.
While technology may be driving many of the changes, this new wave of disruption could shape many aspects of our daily lives. There are also geopolitical shifts to watch as China becomes preeminent in high-tech industries like electric cars and India positions itself as an emerging power.
The implications of this new age of disruption will be profound and exponential, and together we can embrace the opportunities.
Achieving Sustainability
Sustainable investing is evolving rapidly. Increased flows rightly come with increased expectations of measurability and impact. The industry is on a journey: from a focus on ESG-led risk management to purposeful sustainability solutions and ultimately to impact investing strategies that contribute to measurable environmental or social benefits.
We believe this direction of travel towards real-world change will be the long-term trend of the decade. With a considered approach to achieving sustainable outcomes, we are alongside you at the different stages of your journey, whatever your ambitions.
Transforming Infrastructure
Infrastructure is key for the development and smooth running of economies and societies, but much of the infrastructure needed tomorrow does not exist today. Private capital can play a crucial role in funding essential projects as huge investments are needed, especially for the transition to greener energy.
Investors have many ways to enter this complex asset class and can pick their spot in the capital structure and the region or duration of the investment.
With our expertise and market access we are working with investors today to transform the infrastructure of tomorrow.
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1 https://outlook.gihub.org/
2 https://www.allianzcapitalpartners.com/en/media/news/20240321-allianzgi-with-over-eur-50-billion-aum-in-infrastructureInvesting involves risk.. The value of an investment and the income from it may fall as well as rise and investors might not get back the full amount invested. Investing in fixed income instruments may expose investors to various risks, including but not limited to creditworthiness, interest rate, liquidity and restricted flexibility risks. Changes to the economic environment and market conditions may affect these risks, resulting in an adverse effect to the value of the investment. During periods of rising nominal interest rates, the values of fixed income instruments (including positions with respect to short-term fixed income instruments) are generally expected to decline. Conversely, during periods of declining interest rates, the values of these instruments are generally expected to rise. Liquidity risk may possibly delay or prevent account withdrawals or redemptions. The volatility of fund unit/share prices may be increased or even strongly increased. Past performance does not predict future returns. If the currency in which the past performance is displayed differs from the currency of the country in which the investor resides, then the investor should be aware that due to the exchange rate fluctuations the performance shown may be higher or lower if converted into the investor’s local currency. This is for information only and not to be construed as a solicitation or an invitation to make an offer, to conclude a contract, or to buy or sell any securities. The products or securities described herein may not be available for sale in all jurisdictions or to certain categories of investors. This is for distribution only as permitted by applicable law and in particular not available to residents and/or nationals of the USA. The investment opportunities described herein do not take into account the specific investment objectives, financial situation, knowledge, experience or specific needs of any particular person and are not guaranteed. The Management Company may decide to terminate the arrangements made for the marketing of its collective investment undertakings in accordance with applicable de-notification regulation. The views and opinions expressed herein, which are subject to change without notice, are those of the issuer companies at the time of publication. The data used is derived from various sources, and assumed to be correct and reliable at the time of publication. The conditions of any underlying offer or contract that may have been, or will be, made or concluded, shall prevail. The duplication, publication, or transmission of the contents, irrespective of the form, is not permitted; except for the case of explicit permission by Allianz Global Investors GmbH.
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For a free copy of the sales prospectus, incorporation documents, daily fund prices, key investor information, latest annual and semi-annual financial reports, contact the issuer at the address indicated below or Allianz Global Investors | Regulatory. Austrian investors may also contact the Austrian information agent Allianz Investmentbank AG, Hietzinger Kai 101-105, A-1130 Vienna. Please read these documents, which are solely binding, carefully before investing. This is a marketing communication issued by Allianz Global Investors GmbH, Allianz Global Investors | Home, an investment company with limited liability, incorporated in Germany, with its registered office at Bockenheimer Landstrasse 42-44, 60323 Frankfurt/M, registered with the local court Frankfurt/M under HRB 9340, authorised by Bundesanstalt für Finanzdienstleistungsaufsicht (Startseite). Allianz Global Investors GmbH has established branches in the United Kingdom, France, Italy, Spain, Luxembourg, Sweden, Belgium and the Netherlands. Contact details and information on the local regulation are available here (www.allianzgi.com/Info). The Summary of Investor Rights is available in English, French, German, Italian and Spanish at Investors rights.
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For a free copy of the sales prospectus, incorporation documents, daily fund prices, key investor information, latest annual and semi-annual financial reports, contact [the Swiss funds’ representative and paying agent BNP Paribas Securities Services, Paris, Zurich branch, Selnaustrasse 16, CH-8002 Zürich - for Swiss retail investors only] or the issuer either electronically or by mail at the given address. Please read these documents, which are solely binding, carefully before investing. This is a marketing communication issued by Allianz Global Investors (Schweiz) AG, a 100% subsidiary of Allianz Global Investors GmbH. The Summary of Investor Rights is available in English, French, German, Italian and Spanish at Investors rights.