$180bn of private capital available for infrastructure

A new report also predicts two million jobs could be created by 2010 if global private equity infrastructure funds were geared to 60% and invested in the US alongside federal stimulus.

There is $180 billion of private equity capital dedicated to infrastructure globally which could help generate more than 1.5 million infrastructure jobs in the US by the end of 2010, according a report published by Kearsarge Global Advisors.

The report concludes that if US infrastructure stimulus spending were combined with this private equity capital, two million jobs could be created in the US infrastructure sector.

This figure includes the 377,000 public sector infrastructure jobs the Obama administration plans to create through its American Recovery and Reinvestment Plan, which targets the creation of three million jobs by the end of 2010.

An additional 1.5 million private sector infrastructure jobs could be created by the end of 2010 if all the $180 billion of private capital globally were invested in the US over the next 10 years at 60 percent leverage, the study assumes. This would mean private investment of $450 billion in US infrastructure.

“Part of our mission educating lawmakers is that if we don’t find ways to attract and pull-in this capital into the US, it is going to go to other regions in the world, and we will see those jobs go to other regions,” explains Rob Collins, head of infrastructure investment banking at Morgan Stanley, one of the firms that sponsored the report.

Given the national unemployment of 11.1 million Americans as of 9 January, the additional jobs could help decrease the US unemployment rate by 17 percent by the end of 2010, the study concludes.

Kearsarge, a government affairs and communications firm based in Washington DC, prepared the study on behalf of industry players in the US, including Morgan Stanley, UBS, Babcock & Brown and Citi Infrastructure Investors, among others.

Infrastructure: getting crowded
Source: Morgan Stanley