institutional investor investing in infrastructure

Institutional Investor investing in infrastructure

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Why invest in light rail.

Different ways of

Investing in Infrastructure

Long term interests

Advantages of linking

ownership with project

development

Risks

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Pension funds are natural infrastructure owners

- Returns match long liabilities.

- Stable returns

- Risk adjusted rewards

- Inflation protection

- Diversification

Different investment styles and options

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Investment: direct, co-invest, manager, listed

Entry: green field, growth and mature

Investment style: opportunistic, listed, short term PE, long term PE, buy and hold

Value investors objectives: PE–short term optimisation, current cash flow, inflation correlation

Incentives and investment horizon

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PPP with long term ownership

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PPP model if designed correctly focusing on different parties incentives can give:

1.Disciplined evaluation of project economy.

2.Innovation in project design and construction.

3.Innovation in project expansion and the surrounding next works .

4.Innovation in operation and maintenance .

5.PPP savings – project cost, funding and timing,

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Risks and influence on returns:

Risks that needs to be evaluated and has influence on returns:

- Political risk

- Frameworks conditions

- ”revenue” volatility

- technology

- Incentives and alignment (partners and managers)

why light rail ?

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