Data centres: Don’t tell me this is not infrastructure

As investors’ interest in infrastructure continues to rise, so does the debate over the types of assets considered core infrastructure. Data centre companies are at the nexus of this debate.

22 Sep 2020

As investors’ interest in infrastructure continues to rise, so does the debate over the types of assets considered core infrastructure. Data centre companies are at the nexus of this debate, as the sector is not universally considered core infrastructure in the listed space but increasingly sought after by private infrastructure investors. While not all data centre companies qualify as core infrastructure, the select group that does qualify provides investors attractive growth potential driven by long-term secular demand trends tied to the rise of the global digital economy.

Defining core infrastructure with a private market perspective

Our definition of core infrastructure is guided by a private market perspective that identifies core infrastructure as the marriage of a physical asset providing society an essential service with resilient long-term cash flows. Our analysis of companies for inclusion in our core infrastructure investment universe is forward-looking and unconstrained by index definitions. The benefit of our relatively unconstrained approach is the flexibility to keep pace with evolving market trends and actively construct a listed infrastructure portfolio inclusive of core assets with investment characteristics consistent with those owned by private market investors. For investors seeking exposure to infrastructure in the listed markets, we believe our approach provides the most accurate universe of core infrastructure assets.

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