DWS - Wed, 05/01/2024 - 00:57

Infrastructure Strategic Outlook 2024

In a nutshell

  • The infrastructure market is expected to remain under pressure from the new interest rate environment, but infrastructure has absorbed higher rates well in comparison to other asset classes. Given strong cash generation and expectations for rates to fall to more manageable levels, we do not expect major repricing in the unlisted infrastructure market.
  • The infrastructure market has begun to stabilise and 2024 should see a return to stronger fundraising and transaction activity. With economic conditions still challenging, it will remain important for assets to demonstrate downside protection as well as the ability to quickly adapt to prevailing economic conditions.
  • The midmarket opportunity set remains compelling given the ready pool of large cap investors needing to deploy capital into new assets, as well as the higher returns on offer. While we believe that the energy transition and digitalisation will remain two of the major areas for capital deployment for infrastructure investors, we note Transport assets could be an area of increased activity in 2024 as assets kept off the market since the pandemic begin to emerge. In both the U.S. and Europe political risk remains a key area to monitor.  

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