Global Infrastructure Returns Rebound as Contracted Assets Provided Underpin

Annual Total Return by Asset Type

Source: MSCI Global Quarterly Private Infrastructure Index

The MSCI Global Quarterly Private Infrastructure Index returned 7.7 percent for the 12 months ended Mar. 31—the index’s highest annual return since December 2019 and a continuation of the recovery that took place since returns bottomed at 0.6 percent at the end of September.

While capital growth did dip into negative territory during 2020, a relatively stable income return ensured the index’s total return remained positive throughout. At the end of March, the index’s total return comprised an income return of 4.9 percent and a capital growth of 2.8 percent.

Contracted assets—those bound by regulation or subject to long-term contracts—outperformed uncontracted assets since the onset of the COVID-19 pandemic. For the year through March, contracted infrastructure assets returned 9.2 percent compared to 6.3 percent for uncontracted assets.

Since 2008, an increasing percentage of the index’s weight has been allocated to lower risk, contracted assets. As a percentage of enterprise value, the index’s weight in contracted assets has grown from 30.6 percent at 2008Q1 to 56.1 percent at 2021Q1.

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