AMP : Untapped growth opportunity for global listed infrastructure as international investment falls behind other asset classes

Not for release or distribution in the US

Global listed infrastructure is where global real estate investment trusts (GREITs) were 20 years ago, presenting considerable potential for future growth and evolution of the asset class, according to AMP Capital.

Despite the huge demand for infrastructure investments, allocations to global listed infrastructure are still low by comparable standards, with total allocations representing only 3 per cent of the entire listed infrastructure universe. This compares to 30 per cent of the GREIT universe.

AMP Capital Head of Global Listed Infrastructure Tim Humphreys said global listed infrastructure could prove to be one of the world's greatest investment themes due to the unique cashflow characteristics and liquidity of the asset class and a growing trend of government-owned assets moving to the private sector.

'Infrastructure is the backbone for economies to develop and remain competitive. With the breadth of investment required globally, we expect continued cashflow growth from global listed infrastructure companies of 7 to 9 per cent over the medium to long-term,' Mr Humphreys said.

'Global listed infrastructure is still a relatively new asset class but because of its versatility it can play a number of roles in a balanced portfolio. It offers defensive growth, attractive yield and also offers appealing diversification qualities, presenting a largely untapped opportunity for investors.

'Governments have been the traditional providers of infrastructure but since the financial crisis balance sheets are under increasing pressure. This has meant that governments have started to list their infrastructure assets, which creates a win-win for governments, investors and also the public through newly upgraded infrastructure. We will continue to see higher investment from the private sector as governments around the world work to reduce expenditure.

'As an asset class global listed infrastructure has strong cashflow characteristics and the cash generated by the underlying assets provides investors with stable, reliable and growing income. This stability means reliable dividends that grow at attractive rates, often above the level of inflation.'

The findings are part of an AMP Capital whitepaper, The Greatest Investment Theme of our lives? How global listed infrastructure can provide the potential for stable, reliable and growing cashflows, released to coincide with AMP Capital's support for the newly-established Global Listed Infrastructure Organisation (GLIO). GLIO is a global representative body formed to help address global infrastructure's funding gap. AMP Capital is a founder member of GLIO and has a seat on its advisory board.

A full copy of the whitepaper can be downloaded at: http://www.ampcapital.com.au/article-detail?alias=/site-assets/articles/insights-papers/2016/2016-08/the-greatest-investment-theme-of-our-lives

About AMP
Capital AMP Capital is a specialist investment manager with more than A$160 billion in funds under management as of 30 June 2016 and more than 250 investment professionals. AMP Capital has a heritage and strength in real estate and infrastructure, and specialist expertise in fixed income, equities and multi-asset solutions. It is a subsidiary of AMP Limited, which was established in 1849, and is one of Australia'slargest retail and corporate pension providers.

About GLIO
The Global Listed Infrastructure Organisation (GLIO) is the representative organisation for global listed infrastructure investors, companies and those associated with the asset class. Global listed infrastructure represents approximately $1.5 trillion in market capitalization. The mission of GLIO is to act as a central global platform for information, education, promotion and representation. GLIO will work to ensure a better understanding of the long-term benefits of infrastructure investment via listed infrastructure companies. GLIO is a global independent organisation supported by annual subscription fees and guided by an activeglobal advisory board.