(Originally posted on Impact Alpha on April 7, 2016 here)
The water crisis in Flint, Michigan has focused attention on the United States’ crumbling water systems, not to mention roads, bridges and our energy-wasting electrical grid.
In this episode of Returns on Investment, our lively regulars are talking about infrastructure. Wait! It’s more exciting than you may think.
The American Society of Civil Engineers’ (ASCE) Report Card for America’s Infrastructure gives the country a grade of D+. The World Economic Forum ranks the U.S. 16th in quality of overall infrastructure, behind countries like France, Spain and Japan. Here’s a good primer from Will Marshall of the Progressive Policy Institute.
By 2020 it’s estimated that American infrastructure will require $3.6 trillion of investment, according to the 2013 ASCE report.Infrastructure investments provide institutional investors steady yield over long time frames.
That’s a huge opportunity for impact investors, says Imogen Rose-Smith, senior writer for Institutional Investor. “In the impact community you have all these players who realize the desperate need of communities like Flint to have better infrastructure, to have better pipes, to have better roads. They can bring the players into the room to get these deals done, and the institutions can provide the capital.”
“So,” she adds, “the impact investing community is adding value and facilitating real deals.”