Private Infrastructure

Private infrastructure has moved from a niche allocation to what Derek Craig, CAIA®, calls a foundational one, as assets under management in the space tripled from $500 billion to $1.5 trillion between 2016 and 2024. Craig, a managing director with KKR Global Client Solutions, traces the shift to three overlapping drivers: digitalization (data centers and fiber networks built to meet an estimated $106 trillion in global infrastructure investment need), decarbonization (at least 40 percent higher electricity demand over the next decade), and deconsolidation (companies divesting non-core infrastructure to shore up balance sheets). He lays out a four-tier taxonomy — debt, core, core-plus, and opportunistic — for evaluating where a given asset sits on the risk-return spectrum.

Key Takeaways

1. Assets under management in private infrastructure tripled from $500 billion to $1.5 trillion between 2016 and 2024.
2. Global infrastructure investment need is estimated at $106 trillion, with data center capacity expected to require $3 trillion in investment by 2030.
3. Global electricity demand could rise at least 40 percent over the next decade, requiring an additional $500 billion a year in renewable capacity, grid, and storage investment.
4. Craig's four-tier taxonomy — debt, core, core-plus, and opportunistic — maps private infrastructure assets by revenue predictability, from regulated utilities to ground-up data center development.