On July 21st, 2025, the CFA Society Chicago hosted a Vault Series event on Listed Infrastructure Investing. The event was moderated by Sarah Hillegas, CFA, Manager of Investments at DePaul University, with speakers Thomas Miller, CFA, Managing Director and Portfolio Manager on the Public Securities Group Infrastructure Equities Team at Brookfield Asset Management, and Manoj Patel, CFA, Co-Head of Global Infrastructure from DWS Group.
The event started with welcome remarks and background on the Vault Series from Chris Vincent, CFA, President & Chief Executive Officer of CFA Society Chicago.
Hillegas welcomed the attendees and asked the panelists how they got started in the infrastructure investing space. Miller noted he worked initially as a data provider to Brookfield clients and was historically interested in infrastructure such as oil and gas pipelines and took an opportunity to join their energy sector research group. Patel noted he was an analyst originally at a boutique firm, KG Redding, which was acquired by Brookfield Asset Management and helped create the Dow Jones Brookfield Global Infrastructure Index series. Both panelists noted that the Infrastructure Investment and Jobs Act (IIJA), a law that was signed in November of 2021, has brought infrastructure investing more into the spotlight. Additionally, more sovereign wealth funds have allocated investment dollars towards infrastructure in recent years.
The panel was asked to highlight and define infrastructure investing. Miller noted that infrastructure can commonly be thought of in four major categories. Global utilities, such as electric, gas, and water, is one primary category. Energy is another component, such as investing in utilities that focus on oil, gas, and pipelines. Communications such as satellite technology can be thought of as a third category. And transportation, such as toll roads and airports can be considered a fourth major category. Among these groups investors often prefer infrastructure investing due to its more predictable cash flows, having high barriers to entry, and offering inflation protection. Patel also noted it’s helpful from time to time to consider what is not among infrastructure investing. Construction companies may be secondary beneficiaries but are typically not considered a formal part of the category, though they may benefit when the government pushes towards infrastructure. Patel noted as well that infrastructure investments can offer more stable cash flows and strong risk-adjusted returns. The IIJA has been a positive move for this sector with more investment in infrastructure in the U.S. in recent years.
Hillegas asked the panelists to describe the potential size of infrastructure investing. Miller noted that rough estimates would include around 400 or so companies globally and a rough estimation of 5 trillion in market capitalization. Patel also noted that the Dow Jones Brookfield Infrastructure Index Series was launched in 2007 to give investors more opportunities to invest in the category rather than necessarily picking individual investments. When first developed, the index was generally balanced across categories and geographies. Over the last 20 years, the index has grown to be concentrated in U.S. infrastructure investments. Consolidation, especially among transportation companies, has reduced the number of companies that comprise the index. Miller noted that in recent years there’s been a growing focus on electricity generation, which has helped to grow the sector. Miller also noted that the sector offers a good ability to take a bottom-up approach, studying all the companies to choose individual equities. Patel noted that for investors to get into the sector they often will describe their purpose for investing and that can help shape what sub-sectors may be of most benefit for their style. For example, if investors are looking to hedge against inflation, then energy equities could be an option. If investors are looking to create a defensive strategy, then infrastructure investing that is focused on communication or cell towers or utilities might be a sub-sector to consider. If investors were looking for growth in line with the economy, then transportation subsectors might be of interest. Both panelists noted that the sector allows for some pivoting across different subgroups should investors prefer to change their style.
Hillegas asked the panelists if they could identify what they see as the top opportunities in infrastructure investing today. Patel noted it might be the case as to whether an investor is looking to do private equity investment or publicly traded investments. He noted that among publicly traded investments there can be more opportunities in utilities today. Private investment opportunities have grown with sub-sectors such as renewable energy. Miller noted that the railroad sector among infrastructure is in a period of consolidation. Union Pacific and Norfolk Southern are currently engaged in advanced merger discussions and exploring a possible transcontinental merger to connect east and west freight rail networks. Miller also noted that the largest concentration of opportunities today seems to be in North American markets.
Hillegas noted that regulatory concerns are often a question for infrastructure investors and asked the panelists if there were specific regulatory issues that investors should be increasingly aware of for infrastructure investing. Miller noted that there are large geographic differences among regulations. Water regulations in particular can vary greatly since it is overseen state by state, and some states may have a looser focus on regulation than others. By comparison, in the United Kingdom, Thames Water is a broad regulatory authority, so it minimizes the amount of region-by-region regulation that can exist in the U.S. Both panelists noted that in emerging markets regulation should be a large part of the investment duration. Emerging markets may have more volatility, the assets are highly visible and often coveted and may lead to more political interference between regulators and local market infrastructure companies. Analysts noted that the bar for investing is higher in emerging markets than in well-developed markets.
The panelists discussed a variety of current themes that were prominent in infrastructure today, noting that there can be a variety of tailwinds and headwinds in this sector. Patel noted that he saw a convergence of themes impacting infrastructure investing. In past years, the evolution of technology such as artificial intelligence may not have always been part of infrastructure investing, but now with AI impacting the need for data centers, which in turn is impacting the demand for power energy transition. This sector now has many interconnected pieces to it. With the evolution of AI, a strong need for investments in power is on the rise. Miller concurred that technology is transforming the way investors are looking at utilities. Utility investments were perhaps thought of as boring and sleepy in the past but now are being transformed to emphasize growth. In recent decades, power demand has been fairly flat even with population growth and efficiencies, but now power demand has flipped to create growth in the energy sectors of infrastructure investing. The sector, Miller noted, is still regulated but many are now thinking that 6 to 8% annual growth in power demand may be occurring.
Hillegas asked that with the recent market volatility due to tariff conversations, if there is expected to be some near-term future impact on opportunities for infrastructure investing in the U.S. Patel noted the trend can be positive with the potential for more U.S.-based production needing more energy investments. Miller noted that there can be opportunities in the transportation sector with the potential privatization of toll roads and possibly some future potential privatization of airports. Patel noted that this all takes time and with the level of regulation there will need to be a variety of permits and checks before large new projects get started. Some sectors may face a higher level of regulation, such as when pipelines have levels of debate before construction takes place. One advantage to data centers might be that they are more flexible as to where they can be located. In any infrastructure investment, investors should note that it takes time for new assets to be developed. A new power plant might take up to six years for it to be approved and developed. Miller noted that a strong growing trend was for hyperscalers to begin broad discussions with power producers. These hyperscalers are the variety of large-scale cloud computing providers that can offer computing resources and services to the business community. Companies like Meta, Google, and Amazon are in growing conversations with power producers. Utilities now might have a growing risk of being hyperscaler heavy or losing future revenue opportunities if a hyperscaler were to leave and switch to other sources of power. Nuclear energy has seen some deals as well. Small Modular Reactor technology is potentially growing in style as this technology works through nuclear fission reactors that are smaller and more modular than traditional large-scale nuclear power plants. Miller noted that many in the infrastructure investing world are thinking that when small modular reactor technology gets to be more proven out as an energy source, the competition for energy may start to be radically different.
The panelists also commented more on the ongoing international tariff conversations. Patel noted that most infrastructure investments are thought of as domestic market assets, and most would not have a large amount of global influence. Perhaps the place where it could be changing the most is in transportation ports. Miller noted that these sectors often have less volatility. As an example, when markets were down 10 to 15% in early April 2025, infrastructure investments were only down approximately 4 to 6%. Patel noted that from a high-level view infrastructure investments are a somewhat simpler business model. Utilities, as an example, own an asset, and then charge a fee for use of the asset, can project future demand reasonably well. There is a need, however, to study what marginal changes may mean, and what the variety of causes and effects from changes can mean to the investment. Infrastructure investors need to determine if changes occur, who might be poised for success. Patel noted that some of the biggest risks can be in not estimating how consumers will react, as well as the risk of politics, where politicians may say that utilities are abusing consumers. Patel noted that in this sector, management teams do dramatically matter. Management teams must maintain strong relationships with regulators to avoid issues.
Hillegas noted some final helpful views as an infrastructure asset owner. The asset class can be an important inflation hedge, and these assets often have a unique profile which can be helpful if an investor is looking for broader equity diversification. They often have a lower correlation between movements across the entire market and therefore a lower beta when constructing a broad, diverse portfolio. The panelists also noted that there are helpful places to follow the news as to what is going on in infrastructure. For example, the Global Listed Infrastructure Organization has a weekly news roundup that highlights key press releases and news from companies that are in their index. Miller also ordered that the book The Grid by Gretchen Bakke was a very helpful view of the evolution of the electricity utility system. Miller also noted that some interesting developments on the horizon can be seen at airports. The U.S. greatly benefits from having a deep and liquid municipal bond market but that is not the case in other markets outside the U.S. Many foreign airports may not always be run by local municipalities but instead are run by a private corporation. The infrastructure industry is watching this idea play out at John F Kennedy International Airport where a large-scale project for replacing and expanding previous terminals is being done through major private investments.
The event concluded with thanks to Hillegas, Miller, and Patel for a great discussion and helpful insights on infrastructure investing.