Infrastructure debt

With decades of experience, we focus on debt that can generate stable income and higher yields than similar listed credit.

Our approach

Roads, schools, hospitals, ports, regulated utilities, rolling stock, energy generation and waste storage all play a part in helping society to function. We are an innovative, flexible provider of Infrastructure finance; our approach goes hand-in-hand with our strategic focus on delivering investment solutions and predictable cash flows for our investors.

We finance the providers of essential services, which may be subject to limited competition or operate with high barriers to entry. Our investments are comparatively low risk, supported by government regulation and long-term contracts. We prioritise senior debt, in carefully structured transactions. Since we began investing in infrastructure debt in 1998, we have never had a payment default.

Benefits

As infrastructure providers offer essential services, they can be insulated from the most extreme market cycles.

Robust cash flow

Debt is typically repaid from project cash flows, so it can be helpful for investors seeking predictable flows over many years.

Low default risk

Senior debt is prioritised in carefully structured transactions. We have had no payment defaults on our infrastructure debt investments to date.*

Diversification

The risk profile of private infrastructure debt is different to listed corporate bonds, allowing investors to access different sectors and types of revenue.

Sustainable investing

We integrate environmental, social and governance (ESG) considerations into our investment decisions, monitoring projects and promoting good practice.

*Source: Aviva Investors as at 30 September 2018.

Key risks

Investment risk

The value of an investment and any income from it can go down as well as up. Investors may not get back the original amount invested.

Illiquidity risk

Where strategies are invested in infrastructure, investors may not be able to redeem any units in the strategy when they want because infrastructure assets may not always be readily saleable. If this is the case we may defer a request to redeem units.

Valuation risk

Certain assets held in the strategy could, by nature, be hard to value or to sell at a desired time or at a price considered to be fair (especially in large quantities), and as a result their prices could be very volatile.

Regulatory shifts

The frameworks for managing essential infrastructure services can change.