Infrastructure as an Asset Class

Guest Article in "Preqin April 2010" - Barbara Weber and Hans Wilhelm Alfen

Extract from the Article:

Barbara Weber and Hans Wilhelm Alfen’s new book: Infrastructure as an Asset Class provides the reader with the necessary theoretical knowledge and background information to understand all aspects of infrastructure investments. The authors demonstrate that far from ‘only’ representing a conservative asset class, infrastructure assets offer a wide variety of risk/return and cash flow profiles, ranging from highly conservative bond/fixed income-style asset profiles through to investment opportunities that are comparable to (private) equity. Weber and Alfen point out that commonly, studies on infrastructure investments erroneously describe the risk/return profile of infrastructure investments by referring to their industry and sector alone. The authors argue that this approach oversimplifies matters and is therefore inadequate for capturing the risk/return profile of infrastructure investments: The various sub-sectors, their degree of regulation and, in particular, their seemingly endless range of sector and transaction-specific contractual structures mean that there is no such thing as a uniform risk/return profile within any given infrastructure sector.

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