In the year ahead for real assets, we reiterate our view of the value of a private infrastructure allocation in a diversified investment portfolio. Private infrastructure has shown resilience in times of market stress and provided downside protection with low correlation to other major asset classes.1 There are powerful macroeconomic tailwinds bolstering infrastructure today, including federal spending initiatives and the global need to update aging infrastructure.
We see three key themes in real assets:
1. The global need to update aging infrastructure shows an $88 trillion funding gap by 2040.2
2. Unprecedented regulatory support has catalyzed spending on infrastructure, including the bipartisan infrastructure law that authorized $1.2 trillion for transportation and infrastructure spending with $550 billion of that figure going toward “new” investments and programs.
3. The opportunity set includes digital infrastructure, where increasing computing power from generative AI and related technologies is driving heightened demand for data centers and electricity.
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