Private Infrastructure Funds
High demand for infrastructure investments continues. This is reflected in the growing volume managed in infrastructure funds.
Private infrastructure as a global investment theme
The importance of infrastructure projects for economic growth, social development, and energy transformation cannot be overstated. Energy production, energy supply, digital networks, and transportation (roads, bridges, ports) are the backbone of modern economies. The investment needs in these areas are enormous and growing steadily:
According to estimates, trillions of dollars are needed worldwide to maintain existing infrastructure and implement new projects.
However, this challenge also presents an opportunity for investors, especially professional investors.
For some time now, many institutional investors such as pension funds and insurance companies have therefore been focusing their attention on infrastructure investments.
Raiffeisen Capital Private Infrastructure I
Globally invested infrastructure fund with a focus on Europe
Infrastructure funds offer investors the opportunity to invest in infrastructure projects and benefit from their stable returns. This is precisely where Raiffeisen Capital Management comes in, offering institutional and professional investors a diversified investment opportunity in private infrastructure for the first time with “Raiffeisen Capital Private Infrastructure I”:
With its multi-strategy approach, the fund combines investments in infrastructure funds with direct investments in infrastructure projects, thereby creating attractive diversification with regional and sectoral focus.
The fund invests in line with megatrends, with a geographical focus on Europe. The fund's primary objective is to achieve an attractive risk/return profile in order to meet investors' requirements.
In addition, in line with Raiffeisen Capital Management's commitment to sustainability, the fund will be an Article 8 fund *.
Lukas Fasching, Portfolio Manager Raiffeisen Capital Private Infrastructure I
“With our fund, we want to help shape the infrastructure in our core market of Europe while also covering current megatrends such as digitalization and the energy transition.Due to the large investment backlog and the current uncertain market situation, we expect very interesting investment opportunities in the coming months and years.”
Responsible investment
Directing capital toward sustainable projects is an important concern for Raiffeisen Capital Management and also applies to Raiffeisen Capital Private Infrastructure I. Several interdisciplinary teams in fund management deal with defined future topics, including infrastructure. The results of these in-depth analyses are fed directly into the investment process. Raiffeisen Capital Management pursues an integrated sustainability approach based on three levels: “avoid,” “support,” and “influence.”
Partnership with GCM Grosvenor
Raiffeisen Capital Management has established the Raiffeisen Capital Private Markets Strategy platform in Luxembourg for the launch of private markets investments. For its first private infrastructure fund, Raiffeisen Capital Management is partnering with GCM Grosvenor, a global alternative asset manager with more than 20 years of experience in private infrastructure investments.
Note:
Due to the composition of its portfolio, the fund exhibits increased volatility, i.e. the share price may be subject to significant fluctuations up and down, even within short periods of time.
In addition, the yield on foreign currencies can rise or fall as a result of currency fluctuations.
Disclaimer:
This is a marketing information from Raiffeisen Kapitalanlage-Gesellschaft m.b.H. Raiffeisen Capital Private Markets Strategy SCA, SICAV*-RAIF (the "Company"), Raiffeisen Capital Private Infrastructure I sub-fund (the "Sub-Fund"). Please read the Private Placement Memorandum of the Company and the Sub-Fund (the "Private Placement Memorandum") and the subscription agreement for the Sub-Fund or, if applicable, the desired fund share class of the Sub-Fund before making a final investment decision.
The binding basis for the purchase of fund shares in the sub-fund is the respectively valid Private Placement Memorandum, with the Articles of Association of the Company, the most recently published and audited annual report of the Company and, if applicable, the last published unaudited semi-annual report, which can be obtained free of charge in German and English from IPConcept (Luxembourg) S.A. (société anonyme), 4, rue Thomas Edison L-1445, Strassen, Luxembourg. Risks can be found in the general part and the sub-fund-specific special part of the Private Placement Memorandum.
The private placement memorandum and the subscription application must be made available to the investor before the purchase and can be requested from Raiffeisen Kapialanlage-Gesellschaft m.b.H. in German and English.
Investment inquiries Private infrastructure
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Prok. Jens-David Lehnen, CFP® EFA® EFPA ESG Advisor®
Executive Director | Head of Corporate, Institutional & Wealth Clients Austria
Opportunities and risks of private infrastructure
Infrastructure projects not only offer the opportunity to participate in major social and economic trends, but also to generate attractive returns. Infrastructure investments are generally long-term investments and can be expected to generate stable cash flows, which are particularly valuable in times of economic uncertainty.
A key advantage of infrastructure investments is their relative independence from economic fluctuations. Energy supplies, communication networks and roads are used continuously, often regardless of the economic situation. This leads to lower volatility and makes infrastructure a stable asset class. In addition, many infrastructure projects are inflation-proof, as revenues are often linked to inflation, making infrastructure attractive to many investors.
The risk-adjusted returns of infrastructure investments are another reason why investors choose this asset class. Infrastructure investments often outperform traditional asset classes such as equities and bonds. Last but not least, investors want to earn the illiquidity premium.
Risks associated with private infrastructure include, among others:
Infrastructure investments are subject to market fluctuations that could adversely affect the valuation of individual assets. Although the investments are generally less correlated with public markets, they are nevertheless exposed to general economic and market conditions.
There is a risk that, among other things, changes in the administrative practices of competent supervisory authorities, tax authorities or changes in legislation in a relevant jurisdiction could adversely affect an investment.
Issuer risk, also known as debtor risk or credit risk, refers to the risk that the issuer of a financial instrument will be unable to meet its financial obligations, such as interest payments or repayments. This results in a loss of capital for investors.
Characteristics of infrastructure investments
Essential services: Infrastructure investments are investments in critical services. These are services that are essential for the functioning of the economy and society. These services are therefore characterised by inelastic demand.
Real asset investments: Infrastructure is part of what are known as real assets, which means that behind an infrastructure investment there is also a physical asset, a tangible asset.
Long-term nature of the assets: These assets differ from other investments in terms of their long-term nature, among other things. They often have a life cycle spanning decades with long-term usage and purchase agreements.
Predictable cash flows: Purchase agreements for infrastructure assets typically have very long terms with predefined purchase arrangements. This results in a transparent cash flow profile for operators.
High barriers to market entry: The constellations in which infrastructure investments occur range from public-private partnerships to exclusivity agreements in highly regulated markets. In most cases, the infrastructure has a monopoly or oligopoly character.
Examples of private infrastructure investments
The following are general examples of this asset class, which do not relate to the product in question.
 "Data centres: from co-location to hyperscalers")
Data centres: from co-location to hyperscalers
Data centres have become a particularly interesting investment opportunity in the wake of advances in artificial intelligence. Not only are large tech companies investing billions in data infrastructure, but smaller data centres are also increasingly in demand. As current buyer interest exceeds available computing power, "rents" for computing power are currently very high. This leads to attractive returns and long-term capacity utilisation. As this trend is set to continue, further data centres will need to be developed, although the high valuations in some cases mean that a selective approach to suitable investments is required.
 "Battery Energy Storage Systems: Effizienz und Upside-Potenzial")
Battery energy storage systems: efficiency and upside potential
BESS are used in a wide range of applications today. For example, the expansion of wind and solar energy and the associated fluctuations in electricity production pose a major challenge for grid operators and electricity producers. BESS can be used to help stabilise the power grid or to supply the power grid with electricity as efficiently as possible. On the one hand, this means that electricity producers can sell more electricity, and on the other hand, grid operators often pay considerable fees for frequency stability. As a result, BESS can improve the integration of renewable energies such as solar and wind power, leading to a more sustainable and cost-efficient energy supply in the long term. Last but not least, BESS can sometimes also be used to profit from energy arbitrage, whereby electricity is purchased at favourable times and resold when prices are higher.
 "The megatrend of digital infrastructure")
Fibre optic expansion: stable revenues thanks to long-term contracts with internet providers
Fibre optic networks are crucial for modern digital infrastructure and enable high data transfer rates, which are essential for cloud services, streaming and IoT applications. Investors can benefit from stable revenues through long-term contracts with internet service providers and telecommunications companies that pay fees for using the infrastructure. These contracts offer regular and predictable payments that provide protection against market fluctuations. Growing demand for faster internet connections and support from government subsidies are increasing the growth potential and attractiveness of these investments.
 "Electric cars")
E-mobility charging infrastructure plays a key role in the transport revolution
With the increasing popularity of electric vehicles, demand for reliable and accessible charging stations is growing. In this segment, investors benefit from exclusive location contracts and charging prices paid by users for charging their vehicles. Charging infrastructure thus offers a combination of stable income and long-term growth, as it plays a key role in the sustainable transport transition.
Investments in infrastructure projects
Investments in infrastructure projects are not only attractive from a financial perspective, but also contribute to the social and economic development of countries and regions. Given the enormous investment needs and stable earnings prospects, infrastructure will continue to gain importance for investors in the coming years. It is an opportunity that should be seized both for financial gain and for the benefit of society and the environment. As with any investment, however, capital losses cannot be ruled out when investing in private infrastructure.
*) Explanations
Article 8 SFDR: the fund has environmental and/or social characteristics (disclosure pursuant to Article 8 SFDR), SFDR: Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector
A SICAV (short for Société d'Investissement à Capital Variable) is a legal form for an investment company with variable capital that is frequently used in Luxembourg in particular and enables investors to invest in a diversified portfolio of assets. Thanks to the fund structure and the option of integrating sub-funds with different strategies, a SICAV offers a high degree of adaptability. However, investors should carefully consider the costs and risks before investing.
Disclaimer:
This is a marketing information from Raiffeisen Kapitalanlage-Gesellschaft m.b.H. Raiffeisen Capital Private Markets Strategy SCA, SICAV-RAIF (the "Company"), Raiffeisen Capital Private Infrastructure I sub-fund (the "Sub-Fund"). Please read the Private Placement Memorandum of the Company and the Sub-Fund (the "Private Placement Memorandum") and the subscription agreement for the Sub-Fund or, if applicable, the desired fund share class of the Sub-Fund before making a final investment decision.
The binding basis for the purchase of fund shares in the sub-fund is the respectively valid Private Placement Memorandum, with the Articles of Association of the Company, the most recently published and audited annual report of the Company and, if applicable, the last published unaudited semi-annual report, which can be obtained free of charge in German and English from IPConcept (Luxembourg) S.A. (société anonyme), 4, rue Thomas Edison L-1445, Strassen, Luxembourg. Risks can be found in the general part and the sub-fund-specific special part of the Private Placement Memorandum.
The private placement memorandum and the subscription application must be made available to the investor before the purchase and can be requested from Raiffeisen Kapialanlage-Gesellschaft m.b.H. in German and English.
The tax treatment depends on the individual circumstances of each individual investor. This distribution communicationis only for information purposes and does not constitute an invitation to buy or sell fund shares. In particular, the recipient is advised to check the information with regard to its compatibility with his or her own personal circumstances, legal, regulatory, tax and other consequences, if necessary with the involvement of a consultant. For information on opportunities and risks, please refer to the current Private Placement Memorandum, including the respective sub-fund specifics. No assurance can be given that the investment objectives will be achieved.
This Distribution Communication is intended only for interested parties in the countries in which the Sub-Fund is authorised for public distribution.
The Company and the Sub-Fund have been established under Luxembourg law and are authorised for distribution in Luxembourg, Austria, Germany, Czechia, Slowakia, Hungary, Slowenia, Romania, Italy and Croatia. Shares of the Sub-Fund may not be offered for sale to the public in the United States of America ("USA") or for the benefit of UScitizens.
The Company or the Company's authorised alternative investment fund manager (the "AIFM") may decide to cancel the arrangements made for the distribution of the shares of its alternative investment funds in accordance with Article 32a of Directive 2011/61/EU. Further information on investor rights in German can be found on the homepage of the AIFM (www.ipconcept.com): https://www.ipconcept.com/ipc/de/anlegerinformation.html
The documents can also be obtained free of charge in German and English from the institution, Raiffeisen Kapitalanlage-Gesellschaft m.b.H., Mooslackengasse 12, A-1190 Vienna.
Further information on the Company and the Sub-Fund can also be obtained from Raiffeisen Kapitalanlage-Gesellschaft m.b.H., Mooslackengasse 12, A-1190 Vienna.
Previousperformance, simulations or forecasts are not a reliable indicator of future performance. It should be noted that the value of the purchased fund shares may fluctuate due to fluctuations in the investments of the sub-fund as well as the valuation of the target funds and other investments.
Due to the composition of its portfolio, the fund exhibits increased volatility, i.e. the share price may be subject to significant fluctuations up and down, even within short periods of time.
In addition, the yield on foreign currencies can rise or fall as a result of currency fluctuations.
Raiffeisen Capital Management is the umbrella brand of the companies Raiffeisen Kapitalanlage GmbH and Raiffeisen Immobilien Kapitalanlage GmbH.