The strategy seeks to generate total return by investing in a concentrated portfolio that appears attractively valued and may offer additional upside due to the potential to benefit from private infrastructure capital flows.
WHY COHEN & STEERS
Experienced global investment team
Our investment team is one of the largest dedicated to listed infrastructure investing, with leadership that has overseen our infrastructure investing since 2004
Unique and rigorous investment process
Blends proprietary top-down, macro-level framework with rigorous bottom-up, company-level research
One of the longest track records covering all types of market environment; strong historical outperformance
WHY INFRASTRUCTURE OPPORTUNITIES
Private equity mindset
High conviction strategy focused on real returns; fundamental, catalyst-driven investment approach that targets core/core-plus pure-play infrastructure companies with attractive valuations
Differentiated performance profile
Historically strong total returns, reduced volatility and inflation hedging
Compelling investment opportunity
Private infrastructure investors are increasingly targeting listed assets and/or companies as they look to invest raised capital
The Cohen & Steers Infrastructure Opportunities Strategy is designed to provide access to supportive long-term infrastructure fundamentals, with more of a focus on pure play opportunities and companies with greater acquisition potential. We believe these companies could offer higher returns to compensate for potentially higher risk compared to broad global listed infrastructure. These companies also tend to be under-researched, which could create higher alpha generation potential. The strategy seeks to provide significant capital appreciation potential over the entire business cycle.
Our global listed infrastructure team’s experience positions us to better navigate market risks and identify superior investment opportunities. The team comprises 11 professionals (with an average 13 years of investment experience) whose sole or primary responsibility is to global listed infrastructure.
Essential assets: The case for listed infrastructure
Investors’ search for diversification and inflation protection has put a spotlight on infrastructure, made brighter by massive public investment programs and the accelerating transition to a digitized, decarbonized economy.
November 2021 | 1 min
WHY INVEST WITH US
Delivering value to our clients
Cohen & Steers has been investing in listed infrastructure since we launched our flagship Global Listed Infrastructure Strategy in 2004. Based on our commitment to global listed infrastructure and our drive for excellence, we have built a platform positioned to outperform our peers and deliver compelling returns for our clients.
An experienced team
+8 analysts and associates
PORTFOLIO SPECIALIST GROUP
Supporting our investment team and clients
We believe inefficiencies create opportunities for active managers and we seek to take advantage of the following potential opportunities in the infrastructure market:
Capitalize on niche, pure-play prospects
with exposure to greater acquisition activity and industry consolidation trends, which have the potential for higher growth than their larger counterparts.
Exploit informational inefficiencies
caused by limited sell-side analyst coverage, which present active managers with alpha generation opportunities.
Identify potential targets of private infrastructure capital allocation (aka, dry powder) using our proprietary acquisition framework.
The philosophy that guides our global listed infrastructure strategies is underpinned by the following principles:
- Global listed infrastructure markets are inherently inefficient (due to regulation, industry fundamental cycles, securitization of the asset class and a lack of dedicated specialist coverage), which provides opportunities for active investment managers to add value.
- A strict definition of the investment universe is critically important to manage global listed infrastructure portfolios.
- A disciplined investment process that combines top-down industry/sector research with bottom-up company specific analysis can deliver a sustainable advantage because of the range of infrastructure subsectors with varying business models and economic sensitivities.
- Experience and local, on-the-ground research are critical to understanding local regulatory precedent, local languages and the prevailing political environment.
- The delivery of superior risk-adjusted returns demands an embedded, comprehensive and multidimensional approach to risk management.
We seek to take advantage of the following inefficiencies in the global listed infrastructure markets:
- The discounting mechanism of public markets whereby price movements typically occur ahead of changes in fundamentals
- The variations in infrastructure subsector fundamentals resulting from changing macroeconomic conditions
- The opaqueness, lack of history and limited investor experience
Our investment process
The strategy employs a total-return, relative-value approach to investing in infrastructure, designed to create a concentrated portfolio of typically smaller core infrastructure companies in the United States and globally.
We begin by identifying the core global infrastructure investment universe. Although the universe is global and well diversified on regional and sector bases, as an active manager, we may choose not to invest in a particular country, subsector or company.
Analysts are responsible for conducting detailed bottom-up research, developing high-conviction views on fundamentals and valuations on the companies they cover. We continually reassess management’s capabilities to add value and deliver on its goals. In addition, we integrate ESG factors into our research and valuation models.
A proprietary macroeconomic overlay ranks the attractiveness of infrastructure subsectors based on our view of key macro factors and drives subsector allocations in our portfolio. We also use our Proprietary Acquisition Framework to identify companies that screen well under our private market valuation model.
After we have determined subsector positioning, outputs from security-level models quantify relative value within each subsector. As valuations change, we rotate capital among individual securities. Risk management, diversification, liquidity and other factors are also key considerations.
Private real estate entry points emerging amid selloff
Private real estate values are declining, so is deal volume, as sellers are reluctant to transact at the new, lower levels where buyers are interested.
Financial markets distress – Where and when?
Bob Steers, Executive Chairman of Cohen & Steers, recently had a conversation with Howard Marks, co-chairman of Oaktree Capital Management, for the 2023 Real Estate Luminaries Series, which was hosted by The Steers Center for Global Real Estate at Georgetown University.
Preferred securities: Resetting for a new cycle
Recent bank turbulence and the end of the Fed’s rate-hiking cycle create what we believe may be an exceptional buying opportunity for preferreds.
As private real estate sells off, our conviction in REITs grows
Recent market events, including a downturn in private real estate, give us greater conviction in our analysis showing favorable entry points emerging for listed REITs.
Closed-end fund commentary 1Q 2023April 2023 | 3 mins
Closed-end-funds finished the first quarter up as the Federal Reserve continued to hike interest rates amid a volatile opening to 2023.
Infrastructure investing in the new economic paradigm
The prospect of enduring inflation, anemic global growth and heightened market volatility in 2023 and beyond amplify the importance of a dedicated listed infrastructure allocation.
Need to contact us?
We’d be happy to answer questions about our investment solutions or any corporate-related inquiries.
We consider the information in this communication to be accurate, but we do not represent that it is complete or should be relied upon as the sole source of suitability for investment. Investors should consult their own investment professional with respect to their individual circumstances.
Past performance does not predict future returns. Risks involved with investment, including potential loss of capital, are substantial and should be carefully considered. The views and opinions are as of the date of publication and are subject to change without notice. There is no guarantee that any historical trend illustrated above will be repeated in the future, and there is no way to predict precisely when such a trend will begin. There is no guarantee that a market forecast made above will be realized. Active management is not guaranteed to outperform the broader market index.
Important Risk Considerations: Investing involves risk, including entire loss of capital invested. There can be no assurance that the investment strategy will meet its investment objectives. Diversification is not guaranteed to ensure a profit or protect against loss. Since the strategy concentrates its assets in global infrastructure securities, the strategy will be more susceptible to adverse economic or regulatory occurrences affecting global infrastructure companies than an investment company that is not primarily invested in global infrastructure companies. Infrastructure issuers may be subject to regulation by various governmental authorities and may also be affected by governmental regulation of rates charged to customers, operational or other mishaps, tariffs and changes in tax laws, regulatory policies and accounting standards. Foreign securities involve special risks, including currency fluctuation and lower liquidity. Investments in securities which represent small and medium-sized companies may be more susceptible to price volatility than larger companies.