Previously road and bridge construction has been led at the federal and state levels, however, that trend is expected to shift with the Biden administration as they are encouraging private capital to enter infrastructure investments.
According to Institutional Investor, long-term equity providers, such as pension plans, are “ideally placed to partner with governments” on such projects, according to IFM’s global head of infrastructure, Kyle Mangini. In a PPP agreement, private investors work with government agencies to fund, construct, and maintain infrastructure plans. The long-term nature of such projects tends to align with the investment horizon favored by most pension plans, according to the report.
This could potentially bridge the gap between the U.S. and Europe in terms of private infrastructure investment.