Investment Rationale
Overview
Introduction to Private Infrastructure
The engine behind tomorrow’s global economy.
Investments in companies and assets that provide essential services and are owned, operated, or financed by private investors rather than governments and / or public companies.
Private infrastructure is quietly powering the systems we rely on in our everyday lives. As global demand for essential services grows, these assets offer investors a potentially compelling opportunity for long-term, stable returns, defensive income, and portfolio diversification1.
Types of assets
Potential advantages
Low correlation to traditional asset classes (e.g. public equities and fixed income), and to GDP growth or contraction
Energy
Utilities
Transport
Digital Infrastructure
Battery storage
Natural gas power plants
Renewables
Electricity grids
Natural gas pipelines
Airports
EV charging infrastructure
Roads & rail
Cell towers
Data centres
Fibre networks
1. Diversification does not assure profit or protect against market loss.
Ares’ Approach
Portfolio Construction
Water treatment
Often generate consistent income through long-term, contracted revenues tied to essential services
Demand for critical infrastructure has generally remained stable, through market cycles
Revenues are frequently linked to inflation-indexed contracts or regulated frameworks
Portfolio diversification
DURABLE INCOME POTENTIAL
Recession resilience
Inflation hedge
What is private infrastructure?
Animated Video
Infrastructure assets generally: Provide critical services to society Generate predictable, steady cash flows Are long-lived and capital-intensive, creating high barriers to entry
For Professional Investor Use Only. The views contained on this website may change and should not be relied upon as, nor are they intended to be used as, investment advice or a recommendation to buy, sell, or hold any security, investment strategy, or market sector. Ares undertakes no obligation to update the materials contained on this website. Past performance is not an indicator of future results. This website and the content it contains is for informational purposes only and is neither an offer to sell nor a solicitation to purchase any related securities. Investing in private markets investments involves a high degree of risk including, but not limited to, risk of substantial loss of principal. Direct investments in private companies and investments involve a high degree of business and financial risk that can result in substantial losses. Professional Investors must carefully consider the risks and other suitability details in determining appropriate investments for their individual clients’ portfolios. © 2025 Ares Management Corporation REF: 5078915
Making the Case for Private Infrastructure
Infrastructure opportunity fuelled by data and energy demand.
NEXT UP: INVESTMENT RATIONALE
Learn more
Further reading
Understanding Private Infrastructure
Explore five key realities that highlight private infrastructure’s potential for resilience, diversification, and inflation protection.
Tapping into the Evolving Infrastructure Opportunity
Explore the key structural trends driving growth and innovation across the private infrastructure landscape.
Investing in Tomorrow, Looking After Your Portfolio Today
Understanding private infrastructure's role in a portfolio.
The Convergence of AI, Renewable Energy and Digital Infrastructure
The explosion of data, movement to the cloud and emergence of AI are all driving significant growth in data center electricity demand.
Get in touch
Cookies
Privacy
Terms
Read Article
Download
By filling out this form, I give consent to receive insights, event and product information from Ares Management. I understand that I can unsubscribe from all email communications at any time. A link for which is included in all emails. For more information about how we handle your personal information please refer to our privacy policy. Ares Wealth Management Solutions (AWMS) is a global brand of Ares Management Corporation that works with Financial Advisors and Private Wealth Managers to provide alternative investment solutions.
By filling out this form, I give consent to receive insights, event and product information from Ares Management. I understand that I can unsubscribe from all email communications at any time. A link for which is included in all emails. For more information about how we handle your personal information please refer to our privacy policy. Ares Wealth Management Solutions (AWMS) is a global brand of Ares Management Corporation that works with Financial Advisors and Private Wealth Managers to provide alternative investment solutions. To learn more about Ares Wealth Management Solutions, visit www.areswms.com/non-us
Resilient and growing market
Private infrastructure deal activity has remained strong since the global financial crisis, with institutional capital increasingly filling the gap left by traditional lenders.
As economies are evolving, demand for data and energy has continued to accelerate, leading private capital to step in to fund the buildout of assets needed to power tomorrow’s economy. Below are four key structural drivers reshaping the investment landscape.
1
$2 trillion energy investment opportunity
2
Meeting U.S. power demand by 2030 will require 500GW of new capacity and over $2 trillion in investment – a scale that public funding alone cannot meet.
1.9mn
294
4
solar panels
wind turbines
gas plants
Favourable expected power pricing with strong demand and limited supply
3
With the rapidly growing imbalance between the demand for power, and the limited supply of infrastructure assets to supply that power, basic economics suggests that power prices will continue to go up. For investors in core infrastructure, where assets are already operational and cash-flowing, this dynamic may lead to increased revenues.
Diverse sources of power generation
2050
×2
26% CAGR*
Annual Private Infrastructure Deal Volume over the Last 15 Years (USD Billion)
What does 1GW look like?
To generate:
LED bulbs
EVs
households
100mn
2,627
876,000
To consume:
Source: Infralogic Interactive Data Set. All infrastructure closed private transactions from 2009 – 2024. CAGR* = Compound Annual Growth Rate. The CAGR is an estimate of the rate of return per year. The CAGR is the equivalent rate of growth that, if compounded annually, would generate the same level of growth achieved over a given period of time.
Source: IEA, World Energy Outlook 2024
Source: IEA, World Energy Outlook 2024. There are no guarantees that such trends will continue, and actual results may differ materially from those projected.
Global electricity demand is projected to double by 2050
NOW
Over the coming decades, new power generating capacity is expected to arise from diverse sources including:
Natural gas
Nuclear power
Electricity grid efficiencies
Private Infrastructure in Portfolio Construction
See how private infrastructure can potentially enhance long-term portfolio outcomes.
NEXT UP: PORTFOLIO CONSTRUCTION
01
Understanding Private Infrastructure’s Role in a Portfolio.
The explosion of data, movement to the cloud and emergence of AI are all driving significant growth in data center electricity demand
Different access points across the risk/return spectrum
A potential strategic anchor in modern portfolios.
Private infrastructure offers a range of strategies – from core, income-generating assets to higher-growth, opportunistic investments – allowing investors to align exposure with their risk and return objectives.
Private infrastructure is increasingly being used as a core allocation – offering diversification, lower volatility, and attractive long-term return potential. Here are four reasons investors are integrating it into modern portfolio construction:
Strong relative performance versus public markets
Private infrastructure has historically delivered competitive returns with lower volatility, compared to public infrastructure and public equities.
Resilience during market stress
Tied to essential services, private infrastructure has historically been less sensitive to market swings – and has offered stability during periods of volatility.
Enhancing the traditional 60/40 portfolio
1.TThe portfolio allocations shown are for illustrative purposes only and are not intended as a recommendation or advice. Illustrative portfolios are not a solicitation for any specific product. Professional investors must carefully consider the risks and other suitability details in determining appropriate investments for their clients’ portfolios. 2. Diversification does not assure profit or protect against market loss. For Professional Investor Use Only. The views contained on this website may change and should not be relied upon as, nor are they intended to be used as, investment advice or a recommendation to buy, sell, or hold any security, investment strategy, or market sector. Ares undertakes no obligation to update the materials contained on this website. Past performance is not an indicator of future results. This website and the content it contains is for informational purposes only and is neither an offer to sell nor a solicitation to purchase any related securities. Investing in private markets investments involves a high degree of risk including, but not limited to, risk of substantial loss of principal. Direct investments in private companies and investments involve a high degree of business and financial risk that can result in substantial losses. Professional Investors must carefully consider the risks and other suitability details in determining appropriate investments for their individual clients’ portfolios. © 2025 Ares Management Corporation REF: 5078915
Max Drawdown (Peak-to-Trough Loss)
Growth of $100k
Adding private infrastructure can improve portfolio diversification²
Note: For illustrative purposes only. These statements have been based on comparisons made with relevant market indices and such benefits are not guaranteed and may not occur. Information based on Ares’ views and experience.
Source: Private infrastructure represented by Burgiss All Infrastructure Index. Public equity represented by MSCI World Index. Public listed infrastructure represented by S&P Global Infrastructure Index. Past performance is not an indicator of future returns.
Private infrastructure represented by Burgiss All Infrastructure Index. Public equity represented MSCI World Index. Past trends do not imply, predict or guarantee future results.
02
03
04
Here are four reasons investors are integrating it into modern portfolio construction:
What role can private infrastructure play in investors' portfolios?
Private infrastructure is increasingly being used as a core allocation – offering diversification, the opportunity for lower volatility, and attractive long-term return potential.
Private Infrastructure at Ares Management
Global scale. Thematic focus. Deep experience.
NEXT UP: ares' APPROACH
Ares Management brings together deep infrastructure experience, global reach, and a multi-disciplinary platform to invest in the essential assets that support long-term economic growth.
Averaging years of experience
20+
$22.9bn
Platform breadth
Global reach
Infrastructure investment professionals
130+
Located across offices in the U.S., Europe, Asia and Australia
9
AUM IN PRIVATE INFRASTRUCTURE
Deep experience
Partners
14
Specialised experience across the capital structure.
Ares’ Infrastructure platform offers differentiated sourcing opportunities, powerful information sharing and the ability to provide a full range of capital solutions.
1. As of 30 September 2025 and includes offers accepted. 2. As of 30 September 2025. 3. AUM amount as of 30 September 2025 and includes $8.5bn AUM in infrastructure equity (equity & flexible strategy, assets & companies) $11.3bn AUM in infrastructure debt (subordinated debt, senior debt) and $3.1bn AUM in infrastructure digital (digital infrastructure). For Professional Investor Use Only. The views contained on this website may change and should not be relied upon as, nor are they intended to be used as, investment advice or a recommendation to buy, sell, or hold any security, investment strategy, or market sector. Ares undertakes no obligation to update the materials contained on this website. Past performance is not an indicator of future results. This website and the content it contains is for informational purposes only and is neither an offer to sell nor a solicitation to purchase any related securities. Investing in private markets investments involves a high degree of risk including, but not limited to, risk of substantial loss of principal. Direct investments in private companies and investments involve a high degree of business and financial risk that can result in substantial losses. Professional Investors must carefully consider the risks and other suitability details in determining appropriate investments for their individual clients’ portfolios. © 2025 Ares Management Corporation REF: 5078915
$8.5bn
$11.3bn
$3.1bn
Infrastructure Opportunities
Infrastructure Debt
Infrastructure Digital
