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Carlyle enters infrastructure

The Carlyle Group is the latest to jump into infrastructure, joining JPMorgan as one of the latest converts to target the asset class.

The Carlyle Group has put together an infrastructure investment group, and marked its entry into the asset class with the hiring of Bechtel Enterprises vet Robert Dove and former Citigroup/Salomon Smith Barney executive Barry Gold. The pair will co-head Carlyle’s new infrastructure investment team, which The Wall Street Journal reported is raising a $1 billion (€842 million) fund.

There is a dire need to bring private capital to the development and maintenance of public infrastructure throughout the US and we believe this effort will be well received.

Robert Dove, managing director, The Carlyle Group

Infrastructure has taken off in recent years. Carlyle, with its new infrastructure fund is following in the path of JPMorgan Asset Management, which last month launched its own infrastructure investments group headed by Canada Pension Plan Investment Board veteran Mark Weisdorf.

The successes of incumbent players in the market, such as Sydney-based Macquarie, have underscored the benefits of investing in infrastructure, which covers assets such as airports, hospitals, utilities and roads. The asset class is traditionally considered a lower risk investment option, thanks largely to the monopoly-like characteristics that define the segment and its inflation-protective characteristics.

Dove, in a statement, spoke to the need for infrastructure investment in the US. “The proven use of public-private partnerships and concessions in the UK and on continental Europe is now emerging as a means of financing US infrastructure,” he said. “There is a dire need to bring private capital to the development and maintenance of public infrastructure throughout the US and we believe this effort will be well received.”

In addition to Dove and Gold, Carlyle’s infrastructure group has already filled out its roster with six other veterans, including professionals from Bridgewater Associates and Resurgence Asset Management, as well as Bechtel and Citigroup, where Dove and Gold hail from.

The firm’s infrastructure transactions will range in size from $100 million to over $1 billion.