As infrastructure investment, digitalisation and urbanisation reshape markets across Asia, the private equity opportunity extends beyond ownership of the underlying physical assets.

Ahead of SuperReturn Asia, Andrew Olinick, Head of Private Equity at Macquarie Asset Management, explores the growth of specialised businesses serving infrastructure owners and why they may offer a combination of defensive characteristics and private equity-style value creation.

The rise of Infrastructure 2.0

Traditionally, infrastructure investing was centred on owning physical assets such as roads, power plants or utilities.

Today, however, infrastructure has become far more complex, regulated and technology-driven, and owners increasingly focus on outsourcing non-core activities and products to specialised external businesses. These “infrastructure-adjacent” companies represent an attractive investment opportunity.

These ‘infrastructure-adjacent’ companies represent an attractive investment opportunity.
Andrew Olinick, Head of Private Equity, Macquarie Asset Management

From an investment perspective, these businesses combine the defensive characteristics of infrastructure, long-term demand, essential services and recurring revenues with the growth and value-creation potential of private equity.

Many companies are market leaders with strong fundamentals, yet still offer opportunities to improve operations, scale geographically and adopt new technologies. This combination reflects broader trends shaping the private equity and infrastructure-adjacent sectors in what we call the “Infrastructure 2.0” era.

A substantial market opportunity

There is a substantial infrastructure investment gap, with PwC forecasting that global infrastructure spending will top $150 trillion through 2050 across energy, telecommunications, water and transport.

Increased regulation, project complexity and the need for continuous adaptation to technological evolution are driving heightened demand for outsourcing. Specialised providers facilitate this, enabling infrastructure owners to focus on their core activities, improve operations and deliver their capital-expenditure plans.

Maintenance and, at times, replacement of aged infrastructure are key contributors to the opportunity. According to CNBC, more than 70% of the US electricity grid is over 25 years old, while the European Commission’s 2023 EU Action Plan for Grids states that 40% of Europe’s electricity distribution grid is over 40 years old.

In addition, there is an increasing incidence and severity of extreme weather events, heightening the focus on safety and reliability both today and in the future.

For example, Climate Central’s 2024 analysis found that the United States experienced approximately 60% more heat-season power outages between 2014 and 2023 than between 2000 and 2009. It also reports that 62% of lengthy US power outages between 2018 and 2020 overlapped with extreme weather events, particularly extreme heat, heavy rainfall and hurricanes.

The baseline investment needed to maintain and replace the grid, AI, and the associated growth in data centres are driving a significant increase in power demand, necessitating additional investment in both power generation and distribution networks.

Notably, a Bloomberg analysis of BloombergNEF and DC Byte data found that data centres worldwide have the capacity to consume 508 terawatt-hours of electricity annually if operated continuously, more than the total annual electricity production of entire countries, including Italy and Australia.

Overall, there is a significant and growing opportunity to invest in high-quality businesses providing services, products and technologies to infrastructure providers.

Capturing defensive growth

Infrastructure assets have demonstrated resilience amid macroeconomic instability or uncertainty. Companies providing critical services, technologies or products to infrastructure assets benefit from the inherent resilience of their underlying customers.

Many of these businesses have real barriers to entry, pricing power and advantaged market positions, providing them with a competitive “moat”.

This moat may be supported by regulatory requirements, significant capital-investment needs, specialised expertise or entrenched customer relationships. Pricing power can also allow companies to pass through inflation or rising input costs without significantly affecting demand.

Together, these defensive attributes can allow the businesses to maintain operational stability and deliver reliable returns.

Together, these defensive attributes can allow the businesses to maintain operational stability and deliver reliable returns.
Andrew Olinick, Head of Private Equity, Macquarie Asset Management

Where the risks sit

Despite these defensive characteristics, the infrastructure-adjacent space is not without potential risks.

If governments pull back on regulation, permitting or funding for infrastructure projects, the demand on which these companies rely could shrink.

Additionally, if large owners decide to vertically integrate or consolidate around fewer preferred vendors, the addressable market for third-party service providers could grow more slowly than expected.

Nevertheless, we believe the structural drivers underpinning this opportunity, including an ageing asset base and the large infrastructure investment gap, are long-term in nature.

Three trends shaping the next decade

Over the next decade, we expect growth to continue as the infrastructure ecosystem expands. We believe three trends will underpin the opportunity

1. Increasing complexity

Infrastructure is becoming more complex, both technically and operationally.

Factors contributing to this include evolving regulatory requirements, the integration of advanced technologies and growing stakeholder expectations. Managing this complexity will require continued investment to ensure successful delivery and sustainable operations.

2. An expanding definition of infrastructure

With the rapid rise of artificial intelligence, digitalisation and urbanisation, the definition of infrastructure continues to expand beyond traditional physical assets such as roads, bridges and utilities.

It now encompasses digital networks, smart systems and urban platforms. Opportunities will emerge in these areas, creating new markets, introducing complexity and requiring more services.

3. Increased outsourcing

As infrastructure projects grow in scale and complexity, organisations are likely to outsource more specialised tasks and services.

This shift will enable companies to access global expertise, improve efficiency and focus on their core competencies. Outsourcing will also foster innovation as third-party providers bring new technologies and methodologies to the market.

Want to hear more? SuperReturn Asia takes place from 28 September to 1 October 2026 at Marina Bay Sands Convention Centre in Singapore. Join Andrew and other private markets leaders for further insights, discussion and networking.