At the end of April, the Bundesverband Alternative Investments e.V. (BAI) published a comprehensive market study on the infrastructure asset class, focussing specifically on Germany. The study is based on representative survey data from 109 German institutional investors and interviews with 13 industry experts. Here are some of the key findings from the study:
- Investment backlog in Germany: The investment backlog in Germany is considerable. Significant investment is required to drive forward the digital transformation and modernise the ailing infrastructure.
- Attractiveness of infrastructure as an asset class: Infrastructure is perceived by institutional investors as the most attractive alternative asset class. Its importance in investors’ portfolios continues to grow.
- Megatrends as a tailwind: In the long term, infrastructure will benefit from current megatrends, particularly in the area of renewable energies.
- Challenges for investments in Germany: Many German institutional investors are currently investing in infrastructure projects abroad. However, there are barriers to investment in German infrastructure that policy makers need to address.
- Regulatory improvements: Regulatory improvements are needed to increase the use of pension capital to finance the sustainable transformation and modernisation of infrastructure in Germany. For example, investment regulations for pension funds and small insurance companies could be updated.
Overall, the study shows that infrastructure investments in Germany have great potential and will benefit from current trends in the long term. From the study authors’ perspective, it is therefore important that political decision-makers create the right framework conditions to promote these investments and drive the transformation forward.
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Infrastructure investments – Current trends in a challenging environment
