Pension funds investments in infrastructure

Abstract

This essay discusses the reasons why infrastructure investment is attractive to pension funds investors and four different selected vehicles and their pros and cons. The long-term nature of infrastructure assets investments can be matched with long-term liabilities of pension funds. Pension funds investors tend to prefer a cautious and conservative investment strategy which is consistent with the characteristics of infrastructure assets. I choose the Sizewell C nuclear power plant project and two unlisted infrastructure funds as examples of direct equity investment vehicle and private infrastructure funds vehicle respectively. This essay also covers telecommunication and digital infrastructure sector that has good development trends and the same characteristics as traditional infrastructure. The individual and business demand for more efficient internet connection and 5G upgrades have been Stimulating the demand for digital infrastructure since these infrastructure assets are the basis of any data transmission and communication.