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1、THE FUTURE OFINFRASTRUCTUREKNOWLEDGE BRIEF|Volume 7EMERGING TRENDS AND OPPORTUNITIESTABLE OF CONTENTSAsia Pacific Real Assets Association Limited(APREA)does not take responsibility for the content and accuracy of articles on this website.APREA,its respective directors,employees,or affiliates do not

2、make any representation or recommendation whatsoever regarding articles in any of these publications.APREA believes the information in the Knowledge Brief publications to be reliable,but we make absolutely no representation or warranty nor accept any responsibility or liability as to its accuracy,co

3、mpleteness or correctness.Nothing in these publications or website should be taken as a recommendation or to take account of investment objectives,financial situations,or the particular needs of any reader.Any information is no substitute for the exercise of judgment.Readers should obtain their own

4、expert advice on all matters.APREA accepts no liability for damage suffered as a consequence of our published publications,research,policies,or guidance being used to mislead a third party.All rights reserved.Copyright 2022 APREA01Introduction:The Future of InfrastructureBy Sigrid Zialcita02The Impa

5、ct of Inflation and Rising Interest Rates on Infrastructure InvestingBy David Walsh03Riding the Infrastructure Wave in APAC An ESG Perspective By Sharifah Bakar Ali&Shariman Yusuf Mohamed Zain Life Sciences Real Estate Transactions Reached US$18b Globally in 2021What are the Opportunities in Asia Pa

6、cific?By Greg Hyland&Dr.Henry Chin05Urban development in India MumbaiBy Anubhav Gupta0608Data Centres Charting a New Growth Wave in IndiaBy Devi Shankar04ESG:Important Pillars of Warehousing and Logistics InfrastructureBy Rajesh JaggiRenewable Energy Scenario in India:Now&BeyondBy Ankita Sahu07IInfr

7、astructure has come of age as an asset class in the Asia Pacific,commanding the attention of investors and businesses.As the basic system that supports the framework of an economy,infrastructure sectors,including transport,energy,communication,and digital networks,play a vital role in connecting peo

8、ple to each other and facilitating economic and social activities.In the past,infrastructure was dominated by the public sector and perceived as a low-margin,low-value-added sector.But it has rapidly transformed and evolved over the years,fueled by the needs of the new economy.Today,the infrastructu

9、re that we see encompasses a wide range of developments,such as data centres,business parks,modern manufacturing workshops,life science parks,renewable energy,5G networks,and many more.It is thus fitting that APREAs latest Knowledge Brief takes a closer look at some of these projects,providing a gli

10、mpse on emerging trends and opportunities in infrastructure.What is the future of infrastructure development in the Asia Pacific?How can we build and invest in infrastructure that contributes to sustainable growth,expands market opportunities,and helps ensure a greener future?Another pressing need i

11、n our transition to sustainable development is creation of a circular economy,promoting renovate,recycle and reuse,building smart cities,electric mobility and at the country level,these areas have been taken up for reforms.Achieving ambitious renewable energy targets needs close coordination and sup

12、port between various government departments,financial institutions,distribution companies,manufacturers and business conglomerates.INTRODUCTION:THE FUTURE OFINFRASTRUCTUREby:Sigrid ZialcitaAnubhav Gupta of Vikhroli and Godrej Properties advocates for a paradigm shift in Urban Development in India Mu

13、mbai,citing the need for infrastructure projects that are innovative and sustainable.Finally,we complete the picture with two articles from ANAROCK Capital Advisors.Ankita Sahus Renewable Energy Scenario in India:Now&Beyond focuses on alternative energy sources,noting that technology transition and

14、R&D initiatives are strategic allies in the sustainability journey.Devi Shankars Data Centres Charting a New Growth Wave in India talks about the rise of digital infrastructurea trend that will surely continue to grow in the coming years.On behalf of our team at APREA,we hope you find this issue of

15、interest and we look forward to sharing more insights about the real assets industry with you.Together,our Knowledge Brief articles how infrastructure is shaping our world,driving investment opportunities in the Asia Pacific.The articles in this volume touch on different aspects of this timely and i

16、mportant topic.David Walsh of Goldman Sachs opens our Knowledge Brief with his article,The Impact of Inflation and Rising Interest Rates on Infrastructure Investing,providing a macroeconomic backdrop and weighing if infrastructure can act as a hedge in a high-inflation environment.This is followed b

17、y Riding the Infrastructure Wave in APAC An ESG Perspective,authored by Sharifah Bakar Ali of UEM Edgenta Berhad and SharimanYusuf Mohamed Zain of Edgenta PROPEL Berhad.The comprehensive article considers the road infrastructure marketthe trends,key issues,sustainability practices,and what lies ahea

18、d for this sector.Indeed,ESG is a key factor in how businesses are thinking about the way they operate,as evident in Rajesh Jaggi of Everstone Groups ESG:Important Pillars of Warehousing and Logistics infrastructure.In their article Life Sciences Real Estate Transactions Reached US$18b Globally in 2

19、021,Greg Hyland and Dr.Henry Chin of CBRE explore the factors that have helped to fuel demand for life sciences real estate in the region,and how investors can capitalise on significant opportunities in this fast-growing sector.Sigrid is the Chief Executive Officer of Asia Pacific Real Assets Associ

20、ation(APREA).Based in Singapore,she is responsible for overseeing the strategic direction,initiatives and operations of the association across Asia Pacific.Under her leadership,APREA repositioned to an industry trade group focusing on real estate and infrastructure.Sigrid joined APREAs executive tea

21、m in January 2019.Prior to APREA,she served as Managing Director of Asia Pacific Research and Advisory Services of Cushman&Wakefield(C&W)from 2010 through 2018,where she was responsible for research,thought leadership,strategy formulation and client management.Before relocating to Singapore,she was

22、based in Washington,D.C.and led C&Ws U.S.research group in the Mid-Atlantic region,overseeing all aspects of market research activities in the Washington,DC;Virginia;Suburban Maryland,Baltimore;and Philadelphia areas.Prior to joining C&W,Sigrid served as a Senior Economist for the National Associati

23、on of Realtors(NAR).In that position,she developed NARs office,warehouse,retail,multi-family housing,and international research programs.A recognized expert in global economic,public policy and real estate issues,Sigrid is a frequent speaker at industry events.Her commentary on commercial and reside

24、ntial real estate markets is also regularly featured in a wide array of global publications,including the Wall Street Journal,Financial Times,Bloomberg,New York Times and Reuters.Additionally,she has made several television appearances on financial networks and radio such as CNBC,Bloomberg,CNN,Natio

25、nal Public Radio and Channel News Asia.Sigrid holds a Master of Business Administration from Cornell Universitys Johnson Graduate School of Management and a Masters degree in Economics from Pennsylvania State University.She is a member of several civic groups including the Rotary Club of Raffles Cit

26、y in Singapore,where she has served in various leadership positions,and serves in the Executive Committee of the Crohns&Colitis Society of Singapore.Sigrid ZialcitaChief Executive OfficerAPREAABOUT THE AUTHOR:THE IMPACT OF INFLATION ANDRISING INTEREST RATES ON INFRASTRUCTURE INVESTINGK n o w l e d g

27、 e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eby:David WalshThe first half of 2021 saw the global economy continue its recovery fromthe initial shock of COVID-19.The mega-trends in infrastructure that existed prior to the pandemic continued to accelerate,particularly aro

28、und the digitization of our economy and the transition toward renewable energy.The stronger economy in 2021 supported higher infrastructure valuations and active deal making,and this was further strengthened in the U.S.by President Bidens Infrastructure Investment and Jobs Act,which passed through b

29、oth Houses before being signed into law on November 15,2021.However,the supportive environment for infrastructure was challenged in the latter half of the year as inflation showed itself tobe more persistent than initially expected,and the markets expectations of interest rate hikes increased.This p

30、icture has now been further complicated by the conflict in Ukraine which continues to impact supply chains and energy prices,muddying the situation for policy makers as the fear of inflation is quickly becoming the fear of stagflation.As shown below,Goldman Sachs Global Investment Research forecasts

31、 global inflation to remain sharply elevated throughout 2022(with expectations rising even further after the start of the Russia/Ukraine crisis)before declining toward target over the next 10 years,with central bank rates rising from 1.6%in 2021 toward 3%over the long-term.WORLD POLICY RATE&INFLATIO

32、N FORECASTSK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r e2021202220232024202520262027202820292030203120326%4%3%2%1%0%7%8%(2021-2032E)Source:Goldman Sachs Global Investment Research.The Policy Rate is the interest rate used by central banks as an instrument

33、 of monetary policy.Euro Area references the ECB deposit rate,US references the Federal Funds Target Rate,etc.Aggregated figures are Purchasing Power Parity(PPP)-weighted averages.For%Change YoY Inflation,aggregated figures are calculated based on seasonally adjusted numbers.Policy Rate Forecast(%)-

34、CurrentInflation Forecast(%Change YoY)-CurrentInflation Forecast(%Change YoY)-Pre Russia/Ukraine Crisisinfrastructure investors should be cognizant of,particularly in the context of the asset class often being viewed as an inflation hedge.Goldman Sachs Asset Management(“we”)believes that infrastruct

35、ure investors should focus on two key questions:Interest rates and inflation are both important variables that“What is the impact of rising rates on the infrastructure market?”“If inflation is not transitory,will infrastructure exhibit the inflation hedge characteristics that investors expect?”12K n

36、 o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eWWe believe that infrastructure valuations in certain market segments are elevated.A key driver of this has been historically low interest rates,which has allowed manydirect investors to participate in infrastruct

37、ure markets with a low cost of capital.This may have contributed to some of the premium pricing recently seen in the most competitive auctions.As interest rates rise,there may be a softening in the premium pricing of some assets as the cost of these investors capital increases.However,there is reaso

38、n to believe that the“floor”to infrastructure valuations is likely to remain elevated,even if interest rates rise.The key reason being the significant increase in the level of capital participating in infrastructure markets.As infrastructure GPs have raised more capital,and as a number of institutio

39、nal sovereign and public entities have invested directly in infrastructure(more frequently in core type assets),the competition and prices for these assets has increased.These pools of capital are relatively stable and are expected to continue to participate in infrastructure markets,so we expect th

40、e demand for infrastructure assets to remain high.Further to this,we believe the higher returning,value-add strategies are less sensitive to interest rate rises.The reason for this is twofold:WHAT IS THE IMPACT OF RISING RATES ON INFRASTRUCTURE?Value-add strategies naturally have a higher discount r

41、ate applied into their pricing and valuations,so any increase in interest rates is a much smaller component of underwriting;and 1Value-add assets,on average,tend to use less leverage at the portfolio company level,and therefore are less sensitive to interest rates.2K n o w l e d g e B r i e f V o l

42、u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eFinally,the impact of an increase in interest rates on infrastructure investing may also depend onthe extent of the increases,and how quickly they are made.A large and rapid rise in interest rates may spur a correction in the premium prices for

43、 core infrastructure assets;however,we believe the risk of this scenario is low,given central banks continue to show caution in regards to supporting growth while the pandemic continues to disrupt the global economy.A slower and/or smaller rise in interest rates may soften infrastructure pricing,but

44、 we believe it is unlikely to cause a significant“shock”.One reason for this is the embedded inflation protection that infrastructure assets are perceived to provide,giving investors a degree of comfort in their exposure to the asset class.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O

45、 f I n f r a s t r u c t u r eWILL INFRASTRUCTURE BE A HEDGE AGAINST INFLATION?K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r ePricing Structure:Infrastructure investors often seek businesses with long-term contracts to provide income stability and certainty

46、.Those investors that stay true to the key infrastructure characteristics and invest in assets and services that have either explicit inflation linked pricing or those that have true inelastic demand will likely enjoy the inflation protecting attributes.However,if an assets pricing does not reset wi

47、th inflation or is unable to pass through any input cost inflation,the impact from a prolonged inflationary environment could significantly erode value.Input Costs:If inflation is being driven by energy prices,wage growth,and/or raw material prices,the impact on infrastructure businesses could be si

48、gnificant.There are mitigants to this,but it is more pronounced in some assets versus others.Those assets with larger labor forces and those that are undergoing heavy capital expenditure(requiring raw materials)are more at risk if they are not able to generate proportional increases in revenue.Conve

49、rsely,a number of the new-economy infrastructure assets have more structural protection from input inflation given lower exposure to energy prices and raw materials,and tend to have proportionally smaller labor forces.Whether infrastructure will indeed act as an inflation hedge is a more complicated

50、 question.Given the somewhat amorphousdefinition of infrastructure assets today,we believe investors should avoid treating infrastructure as a homogenous asset class with universal inflation hedging properties.We agree that infrastructure assets,on average,are less sensitive to inflation,and in many

51、 environments will perform ahead of other growth focused assets and evidence,the resiliency and defensiveness that investors expect.However,the extent of the inflation protection can vary dramatically based on the following factors:K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f

52、 r a s t r u c t u r eCONCLUSION:David WalshABOUT THE AUTHOR:Higher inflation and rising interest rates will continue to provide opportunities and challenges for infrastructure investing and reminds us that not all infrastructureassets are created equally.Rising interest rates may put pressure on th

53、e recent premium pricing that we have seen in the largest core assets but should have less of an impact on value-add assets,which have less interest rate sensitivity;while rising inflation may aid those infrastructure businesses with inflation linked pricing,inelastic demand,and stable cost structur

54、es,while adversely affecting those that dont hold such attributes.Managing DirectorGOLDMAN SACHSDavid is a managing director in Alternatives Capital Markets and Strategy(ACMS),which oversees institutional capital markets,capital raising and client strategy across all direct-investing and open-archit

55、ecture alternatives strategies throughout Goldman Sachs.Previously,he was a member of the public markets investment team in Alternative Investments and Manager Selection.David joined Goldman Sachs in 2016 as a vice president and was named managing director in 2021.Prior to joining the firm,David wor

56、ked at Investcorp for two years and UBS for nine years in both London and New York.David earned a BS in Economics from Monash University in Australia.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O

57、 f I n f r a s t r u c t u r eDISCLOSURESThis communication has been prepared by Goldman Sachs Asset Management and is not aproduct of Goldman Sachs Global Investment Research.This communication is solely forinformational purposes and should not be used as a basis for trading in the securities or lo

58、ans ofthe companies named herein or for any other investment or business decision.Thiscommunication does not constitute an offer to sell the securities or loans of the companiesnamed herein or a solicitation of proxies or votes and should not be construed as consisting ofinvestment advice.This commu

59、nication and associated material is intended only to facilitatediscussions with Goldman Sachs and is not intended to be used as a general guide to investing,or as source of any specific investment,product or service recommendations.Goldman Sachsis not providing any financial,economic,legal,accountin

60、g,or tax advice or recommendations.All information and data included in this communication and associated materials is current asof March 2022.Goldman Sachs believes the data included in this communication and theassociated materials is accurate,but does not verify its accuracy independently and doe

61、s notwarrant or guarantee that it is accurate or complete.Goldman Sachs has no obligation toprovide any updates or changes to the data.This communication and associated material doesnot purport to contain a comprehensive overview of any products and offerings and may differfrom the views and opinion

62、s of other departments or divisions of Goldman Sachs and itsaffiliates.The use of third party logos is purely for informational purposes.No affiliation,sponsorship or endorsement by or for any third party trademark owner is hereby expressed orimplied.Past performance does not guarantee future result

63、s,which may vary.The value of investmentsand the income derived from investments will fluctuate and can go down as well as up.A lossof principal may occur.Please note that this material may include certain information on Goldman Sachs AssetManagement sustainability practices and track record,at an o

64、rganizational and investmentteam level,which may not necessarily be reflected in the portfolio of any fund(s)or relatedinvestment vehicle(s)you invest in.Please refer to the offering documents of any fund(s)priorto investment,for details on how and the extent to which the fund(s)takes ESG considerat

65、ionsinto account on a binding or non-binding basis.The opinions expressed in this white paper are those of the authors,and not necessarily ofGoldman Sachs.Any investments or returns discussed in this paper do not represent anyGoldman Sachs product.This white paper makes no implied or express recomme

66、ndationsconcerning how a clients account should be managed.This white paper is not intended to beusedasageneralguidetoinvestingorasasourceofanyspecificinvestmentrecommendations.This information discusses general market activity,industry or sector trends,or other broad-based economic,market or politi

67、cal conditions and should not be construed as research orinvestment advice.This white paper has been prepared by Goldman Sachs and is not financialresearch nor a product of Goldman Sachs Global Investment Research(GIR).It was notprepared in compliance with applicable provisions of law designed to pr

68、omote theindependence of financial analysis and is not subject to a prohibition on trading following thedistribution of financial research.The views and opinions expressed may differ from those ofGoldman Sachs Global Investment Research or other departments or divisions of GoldmanSachs and its affil

69、iates.Investors are urged to consult with their financial advisors before buyingor selling any securities.This information may not be current and Goldman Sachs has noobligation to provide any updates or changes.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r

70、eby:Sharifah Bakar Ali and Shariman Yusuf Mohamed Zain*The views and opinions expressed in this article are solely the authors and do not purport to reflect the views and opinions of UEM Edgenta Berhad,its subsidiaries or related companies.Riding the Infrastructure Wave in APAC An ESG PerspectiveThe

71、 Asia and Pacific Regions are home to a significant proportion of the globalpopulation,housing more than 4.6 billion people of varied demographics(ESCAP 2019).The region has experienced decades of rapid economic growth,outpacing many other economic blocks.Economic growth has brought with it unpreced

72、ented levels of urbanization.In 2018,more than half of the APACs population were living in towns and cities(Habitat III 2015).By 2050,the region will add over 1 billion city dwellers(Habitat III 2015).While urbanization is progressing,many APAC citizens still live in rural areas.Close to half of Sou

73、theast Asias population was living in small towns and villages in 2020(TheGlobalE 2020).The advent of cities and the need to improve rural conditions will see the development of infrastructure at breakneck speed in APAC.The COVID-19 pandemic has also placed anurgent need to develop a robust digital

74、infrastructure system to improve the delivery of healthcare services and maintain supply chain networks.The APAC market will require$26 trillion in infrastructure investments by 2030 to maintain growth and eradicate poverty(ADB 2017).The region will see the creation of more modern transport networks

75、,affordable dwelling spaces,healthcare facilities and digital platforms.These developments will leave carbon footprints on the environment.The infrastructure developments will also impact the lives of communities.The objective of this article is to discuss the emerging infrastructure trends in the A

76、PAC region with a focus on roads.It will discuss what constitutes responsible road investments,challenges in meeting sustainability requirements and recommendations to accelerate the adoption of sustainable transport solutions for APACs infrastructure needs.K n o w l e d g e B r i e f V o l u m e 7T

77、 h e F u t u r e O f I n f r a s t r u c t u r eTHE APAC ROAD INFRASTRUCTURE MARKETgrowth.There will be a growing need for transport networks.Indonesia increased its budget for infrastructure spending by$225 billion for the period 2020 to 2024 from the previous corresponding period of 2015 to 2019,w

78、ith 60%of this amount earmarked for transport networks(PWC 2016,AHK).In April 2021,Vietnam announced a 2030 transport infrastructure master plan estimated to cost between$43 billion and$65 billion(ASEAN BRIEFING 2021).The more mature markets,such as Singapore and Australia with established transport

79、 and metro systems will build infrastructure around those networks to support an ageing population.APAC does not only require new road infrastructure.Ageing road assets,particularly in emerging economies,will require active maintenance and replacement to keep them running and safe for users.By 2030,

80、developing countries in Asia need to invest$8.4 trillion in transport,including road rehabilitation and maintenance(ADB 2017).The APAC market is very diverse.Emerging economies such as Cambodia,Laos,Myanmar,and the Pacific islands will require further investments to spur economic K n o w l e d g e B

81、 r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eCambodiaLaosIndonesiaVietnamSingaporeAustraliaMyanmarTThese investments while improving connectivity are also posing a different type of challenge to the environment and society at large.They emit emissions into theatmosphere,cau

82、se noise and deplete the earths natural resources.Pollution from roads make the environment a less safe and comfortable place to live in.The transport sector will contribute to 46%of the share of global emissions by 2035(The Diplomat 2016).By 2025,urban areas in APAC are also expected to produce 1.8

83、 million tons of solid waste that can emit harmful gasses(Habitat III 2015).Toxic gasses contribute to global warming leaving society highly vulnerable to climate disasters.The earths temperature has risen by 0.08 degrees Celsius per decade since 1880(Climate.gov 2022).At this rate global warming ca

84、n reach 1.5 degrees Celsius between 2030 and 2052(BBC News 2019).Roads dont just leave impacts on the environment.They also leave an impact on the lives of the communities surrounding them.On the positive side,they provide connectivity.On the flip side,they cause the displacement of people when buil

85、t.From a governance standpoint,road projects that lack transparency raise concerns about corruptions and bribery.Taking heed of these alarming indicators and concerns,governments and policymakers are taking steps to reduce emissions and build infrastructure responsibly.Goal 9 of the UNs Sustainable

86、Development Goals “Industry,Innovation and Infrastructure”calls for the creation of resilient infrastructure,promotion of sustainable industrialization and fostering of innovation(United Nations).Environmental laws are also getting stricter to curb pollution and emissions.K n o w l e d g e B r i e f

87、 V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r ePost COVID-19 the budgets for large scale transport projects in APAC will balloon to boost recovery.Amidst shrinking government coffers,private investors willdrive infrastructure investments.These private investors are seeking low-carbon

88、 and climate-resilient road networks.57%of investors in the APAC region are expected to have fully or partially incorporated ESG issues into their investment analysis by the end of 2021(CNBC 2021).For road projects,they want project designs to incorporate sustainable materials,recycling of wastes to

89、 promote circularity,responsible sourcing and management of labor,implementation of health and safety standards for workers,transparency in negotiating contracts,proper emission measurements and good ESG disclosures.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t

90、 u r eROAD INFRASTRUCTURE INVESTMENTS AND ESG CONSIDERATIONSIn theory,ESG considerations aim to promote equity and fairness.In practice,however,they come at a cost,demotivating infrastructure players from going green.This is not just the case for new road projects.Decommissioning or retrofitting old

91、er assets to adapt to climate change and technological advancements is even more challenging as they were not designed to be sustainable.At most,certain aspects of themaintenance process can be transformed.These include the use of electric powered road cleaning devices,incorporation of recycled mate

92、rials in repair works,or powering of road lights using solar energy.These improvements,however,may only produce marginal emission reductions,not as substantial as reductions frombuilt processes.It is no wonder that APAC lacks bankable,sustainable infrastructure projects.providers who embrace innovat

93、ion have seen opportunities in the market.They find ways to maximize the lifetime of highways and improve asset life-cycle costs through operational efficiencies.Building techniques are being redesigned to incorporate the use of more recycled materials to reduce the consumption of energy or noise ge

94、nerated.Still,project developers and road maintenanceK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eSource:Asphalt Recycling Plant by UEM Edgenta BerhadPhotos courtesy of UEM EdgentaUEM Edgenta Berhad(Edgenta),a leading Asset Management and Infrastructure S

95、olutions Company headquartered in Malaysia with footprints in SEA,Taiwan,India and the Middle East,is developing an Asphalt Recycling Plant to mill waste produced from roads resurfaced into new asphalt mix for pavement construction.The project,estimated to cost more than RM15 million,is expected to

96、reduce CO2 by 800 tones and will reduce waste diverted to landfills.The plant is at an R&D stage and is expected to be commissioned in Q1 2023.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eSource:Rainwater harvesting by UEM Edgenta and PLUS Expressways Ber

97、hadPhoto courtesy of UEM Edgenta and PLUS Expressways BerhadTechnology is also being actively deployed to automate road maintenance activities.Smart Mobility systems in urban areas use tools such as unmanned aerial vehicles and intelligent traffic management systems for safety surveillance and to de

98、fray congestions.Operators are also actively recycling waste generated by road users to reduce the amount of waste sent to landfills.As the use of electric vehicles increases,more EV charging stations are sprouting along highways.Another sustainability project driven by PLUS Expressways Berhad*in pa

99、rtnership with Edgenta to harvest rainwater complete with water meters at 9 selected locations spanning over the Northern,Central and Southern regions along the North South Expressway in Malaysia.Rain harvested will be channeled for landscaping and cleaning of facilities at the locations.(*largest h

100、ighway concessionaires or BOT operator company in Malaysia)THE CHALLENGES TOACHIEVE SUSTAINABILITYstages of development and require extensive R&D support.Scaling up these efforts will require time and returns may not be immediate.Rainwater harvested along highways is very much dependent on climate c

101、onditions.The use of sustainable materials such as crumb rubber and super fiber to produce pavements may require long testing periods to prove their durability.Recycling solid wastes on highways may not work if road users do not separate wastes.Policy and process transformations also remain a challe

102、nge for builders and operators.They must be practised along the value chain and not adopted in isolation.Sourcing materials responsibly is not just the duty of project owners but also that of suppliers.Every player in the ecosystem must demonstrate commitment.Such coordination requires time.These su

103、stainable initiatives though commendable,remain at nascentESG investors profess to balance ethical dividends against financial profits.In practise ROI indicators often drive project evaluation.Profits are sought while projects are still gestating.Currently,there is also a huge focus on the disclosur

104、e of ESG-related information.While disclosure is encouraged,particularly to protect minority shareholders and vulnerable stakeholders,it comes at a cost as there are various standards governing ESG compliance.Players are left confused as the information to be disclosed is very technical.ESG standard

105、s also do not give sufficient credit to players like highway operators who do not own road assets but still reduce emissions for road clients.Compliance thus risks being reduced to a box-ticking exercise.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eTHE WA

106、YFORWARDRegardless of these challenges,players in the road ecosystem are aware of the concernsthat road infrastructure poses to the environment and society and have started taking steps to build and maintain more responsibly.They need support to transform,which can come in various ways.First from in

107、vestors,through their patience in seeking returns from capital invested.Second,through a concerted effort orchestrated by either the regulators or standard setters to encourage standardised adoption of ESG practices evenly along the value chain.Smarter collaboration among infrastructure players at a

108、ll levels,be it locally or internationally,is thus key to achieving a sustainable infrastructure agenda.Third through uniformity in ESG standards so that the cost of compliance can be minimized and disclosures made simpler.These changes will require more dialogues among market participants.The dialo

109、gues should include wider participation of all players in the value chain for talks to produce the desired outcome.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eREFERENCESADB2017Meeting Asias Infrastructure Needs.Available at https:/www.adb.org/sites/defau

110、lt/files/publication/227496/special-report-infrastructure.pdfAHKIndonesia Continues Infrastructure Offensive.Available at https:/indonesien.ahk.de/infothek/indonesia-continues-infrastructure-offensive(Date Unavailable)ASEAN BRIEFING 2021Vietnams Transport Infrastructure Master Plan:Three Proposals f

111、or Implementation.Available at https:/ News2019Climate Change:How hot cities could be in 2050.Available at https:/ Change:Global Temperature.Available at https:/www.climate.gov/news-features/understanding-climate/climate-change-global-temperatureCNBC2021ESG Investments surged in Asia-Pacific in 2020

112、 as sustainable investing takes off,MSCI Survey Finds.Available at https:/ Population Data Sheet:Population and Development Indicators for Asia&the Pacific,2019.Available at https:/www.unescap.org/sites/default/files/Population%20Data%20Sheet%202019.pdfHABITAT III2015Asia Pacific Region Quick Facts.

113、Available at https:/habitat3.org/wp-content/uploads/Asia-Pacific-Region-Quick-Facts.pdfPWC2016Indonesia Infrastructure Stable Foundations for Growth.Available at https:/ population,percent in Southeast Asia.Available at https:/ Diplomat2016Transport:A Pivotal Sector in the Asia-Pacifics Journey to S

114、ustainability New initiatives are needed to deepen Asian transport connectivity.Available at https:/ NationsMake the SDGs a Reality.Available at https:/sdgs.un.org/#goal_section(Date Unavailable)Sharifah Bakar AliHEAD,STRATEGIC BUSINESS AND MARKET DEVELOPMENTUEM EDGENTA BERHADABOUT THE AUTHOR:Sharim

115、an YusufHEAD,INFRASTRUCTURE SERVICES MANAGING DIRECTOREdgenta PROPEL BerhadSharifah joined UEM Edgenta in July 2021 to steer strategic partnerships and explore new markets.In this role,she is also tasked to develop Edgentas ESG Blueprint.Prior to Edgenta,Sharifah provided investor relation services

116、for corporate and institutional clients in the global real estate markets through Bespoke Globiz,an Asia based advisory firm she founded.Sharifah has also worked at investment banks in Malaysia and the Middle East specialising in the areas of debt capital markets and Islamic finance.She is a Charter

117、ed Accountant and a Certified Public Accountant.She holds an MBA from Cambridge Judge Business School.Shariman heads UEM Edgenta Berhads Infrastructure Business,leading a dynamic team of experts in providing asset management and infrastructure solutions.Prior to heading PROPEL,Shariman led the Clien

118、t Solutions team at Edgenta and drove the companys business development initiatives.Shariman has held senior roles at various MNCs including Siemens,General Electrics,Shell and Deloitte Consulting.He was also the first local country head/CEO for the Mobility Division in Siemens Malaysia.Shariman hol

119、ds a Bachelor of Economics(Accounting&Finance)(Hons)from the London School of Economics&Political Science.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eby:Rajesh JaggiESG:Important Pillars of Warehousing and Logistics InfrastructureBusinesses and investors

120、 are increasingly working together to address majorglobal challenges.The adoption of environmental sustainability,social inclusion,and a good governance plan can accelerate the operational,cultural,and financial changes needed to future-proof a business.ESG is evolving as a driver for future innovat

121、ion and opportunities,thereby creating measurable value in the industry and the society at large.Resource efficiency,climate change mitigation,ethical work practices,and corporate governance are the key elements of the ESG framework.Today,investors and regulators also focus on businesses adhering to

122、 environmental and more increasingly social norms.Meanwhile,the Government of India has pledged to achieve net-zero emission by 2070 at the recent COP-26 climate change conference in Glasgow.ESG IN REAL ESTATE AND INFRASTRUCTUREK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a

123、 s t r u c t u r eReal estate and infrastructure are closely related.Both these industries are a major consumer of energy and materials,making it the prime contributor to global carbon emissions.The application of ESG standards by both,the developers and the government will benefit operational effic

124、iency,risk management,competitive advantage,and strengthen stakeholder relationships.Leading companies in the sector have become increasingly aware of the ESG issues and their impact on the environment.They have started sharing their ESG and sustainability goals,action plans and data more openly,in

125、their reporting processes.Implementing an efficient ESG-focused infrastructure system is vital for the real estate industry.The construction of sustainable buildings and industrial parks with smart technologies and eco-friendly materials can further support the global decarbonization efforts.ENVIRON

126、MENTAL SUSTAINABILITY-CONSERVATION OF THE NATURAL ENVIRONMENTThe collective goal should be to continue reducing the environmental footprint fueled by advancements in technology,implementing rooftop solar systems,natural ventilation designs,green material selection,and water savings,in green warehous

127、ing.IndoSpace was one of the few businesses that indulged early in green warehousing.In our green initiative,we introduced the rooftop solar project with the intention to use 40 million square feet of roof space into renewable energy.Other technological interventions include smart sensors,e-charging

128、 stations,automation for increased efficiency,drone video footage to showcase site progress and applications for facility management and tenant communication.key role.It includes the approach of a company in managing its physical assets while tackling the issues that affect the environment.Green Hou

129、se Gas(GHG)emissions,pollution,deforestation,water and waste management systems and energy efficiency are matters that a developer can address through sustainable design,construction,and operations of green buildings.Although the concept of ESG is extremely wide,environment and sustainability play a

130、K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eSOCIAL INCLUSION-CONSIDERATION OF SOCIETY AND RELATIONSHIPSupply Chain ManagementEmployee Health and SafetyLabourPracticesData Protection and PrivacyCustomer SatisfactionThe ESG policies are not limited to the

131、organization but also cover society and stakeholder relationship.To assess the social sustainability of real estate,attention is extended to:The tenants trust warehouses that follow a sustainable approach and meet ESG commitments.By choosing the right partners,they in turn jointly work together in a

132、chieving their sustainability and environmental goals.In a developing country like India,CSR can play a major role towards social inclusion.Warehouse developers should take additional efforts to understand the community needs and accordingly design and implement CSR projects in the region and create

133、 a long-lasting positive impact.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eCovid-19 demonstrated the importance of a well-planned organizational governance,which would cover board composition,business ethics,bribery and corruption,tax transparency,inter

134、nal controls,and stakeholder rights.Organizational indicators must include corporate policies,processes,and operations that are comprehensive,fair,and exhibit integrity.Not limited to them,the policies need to extend and include suppliers,vendors,and every person that works for the organization.ESG

135、factors are often interlinked and together they project the companys performance that assures the warehousing infrastructure is managed and organized more efficiently.Infrastructural improvements and a sustainability governance structure is the key to achieve an integrated ESG approach.Effective gov

136、ernance mechanisms are much needed around emerging topics such as cyber security and data protection.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eGOOD GOVERNANCE-STANDARDS FOR THE MANAGEMENT OF AN ORGANIZATIONAMPLIFYING FINANCIAL CAPITAL BY INCORPORATING

137、ESGIIn many ways,ESG drives value by enhancing the long-term merit of acompany,improving its financial performance while reducing its financing and operational costs.The future of how organizations run and how financial risk is considered will have a significant impact due to climate change.Companie

138、s need to start comprehensively assessing the financial risks of climate change in longterm business strategy and identifying actions to work on the sameTo attract investment in sustainable infrastructure,it is of utmost importance to continue defining the asset class.For example,attaining Grade A w

139、arehousing mark is not possible without adopting ESG framework.Companies need to prepare more conforming warehouse design and construction methods and make productive use of resources.Investors,clients,and society are more likely to invest and hire companies that profitably solve problems for the pe

140、ople and the planet rather than creating new problems.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eFUTURE ANDOPPORTUNITIESK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eTo embed ESG capabilities,companies must im

141、plement effective resourcemanagement and build sustainable facilities.Companies also need to map carbon footprint to minimize the social impact of business.Existing assets would need retrofit strategies so that they too consume less resources during operational lifetime.Furthermore,ensuring steps su

142、ch as adopting artificial intelligence(AI),automation,and planning and designing activities that incorporate technological innovation,to name a few,can aid in fulfilling ESG goals.Any new development can align to global best practices/frameworks on net-zero.Today,the demand for green energy infrastr

143、ucture has surged.Innovation in engineering is lowering the cost of green building infrastructure.Infrastructure,facilities,and other physical asset decisions present a company with a chance to realize its goals while lowering costs and increasing value.Organizations that grab this opportunity while

144、 including physical infrastructure asset management into their long-term planning will flourish in a greener future.IndoSpace has been ranked in the leadership quadrant by renowned bodies like EDGE and IGBC as a Green Champion for our domain knowledge,innovation,and ESG impact.At IndoSpace,we look f

145、orward to consistently cooperate with our stakeholders and social ecosystems,as part of our commitment to make businesses ESG compliant.Our goal is to achieve 100%sustainable buildings and LED lighting,reduction of minimum 3%GHG emission,and zero consequential injuries by the year 2025.Rajesh JaggiV

146、ice Chairman-Real EstateEverstone GroupABOUT THE AUTHOR:Rajesh Jaggi is the Vice Chairman-Real Estate,at the Everstone Group,one of Asias premier investment groups focused on domestic investments in India and Southeast Asia,and cross border North America Asia investments.Rajesh joined Everstone in 2

147、012 as a partner and is responsible for all real estate investments and operations of the group.He has over 25 years of real estate leadership experience in India,including strategic planning,acquisitions,finance,sales and marketing,legal,and project and facility management services.Under his leader

148、ship,Everstone Groups industrial real estate business IndoSpace,has become the pioneer and the largest developer and owner of Grade A industrial and logistics real estate in India and has taken the total commitment to India to above US$3.2 billion.IndoSpace is the only pan-India developer of modern

149、industrial real estate and has a portfolio of 49 million square feet across 44 logistics and industrial parks with a marquee tenant profile consisting of blue-chip,multinational conglomerates such as IKEA,Amazon,Nissan,DHL,DB Schenker,Delhivery,Steelcase,Ericsson,Bosch,and Aptiv.These facilities are

150、 in and around nine major industrial corridors/consumption hubs Delhi NCR,Mumbai,Pune,Bengaluru,Chennai,Ahmedabad,Coimbatore,Anantapur,and Rajpura and well connected through rail,road,air,and sea.In 2020,Euromoney magazine ranked IndoSpace amongst the top three overall Real Estate Developers in Indi

151、a for the second year in a row and named it the Best Developer of Industrial/Warehouse Real Estate in India for the sixth year in a row.In the same survey,IndoSpacewas also awarded the Best Innovative Green Developer in India for 2020,based on IndoSpacescontinuous efforts to integrate sustainability

152、 and adopt sustainable technology to reduce carbon footprint.IndoSpace has also been named the Firm of the Year-India thrice in a row by the respected PERE magazine,the real estate arm of PEI,at PERE Awards 2021.In 2018,IndoSpace formed a strategic long-term partnership with GLP,the leading global p

153、rovider of modern logistics facilities and technology-led solutions.GLP has over US$100 billion assets under management.Through this partnership,GLP has become an investor in IndoSpace Core,a joint venture established in 2017 by IndoSpace and Canada Pension Plan Investment Board(CPPIB)focused on acq

154、uiring and developing modern logistics facilities in India.CPPIB initially committed approximately US$500 million to IndoSpace Core.Rajesh is also a Young Presidents Organization(YPO)member in the YPO Gold Mumbai Chapter since 2013.Before joining Everstone,he was the Managing Director of Peninsula L

155、and Limited,a USD 400-million market capitalization listed real estate company,where he led the successful commissioning of projects that totalled 28 million square feet of real estate across residential,commercial,and retail space.Recently under Rajeshs guidance,Everstone Group has established Ever

156、Yondr a joint venture with the Yondr Group,a global leader,developer,owner-operator,and service provider of hyperscale data centers,to develop and operate data centers in India and support hyperscale clients and service in the fast-growing Indian market.EverYondr has already received commitments of$

157、500 million and will seek to raise an additional$500 million to take the final capital commitment to US$1 billion.Rajesh is a graduate of the University of Mumbai and an alumnus of F.W.Olin Graduate School of Business at Babson College,Boston.He was featured as one of Indias Hottest Young Executives

158、 by Business Today magazine(February 8,2009 issue)recognition for his contribution to leading Peninsula from a local Mumbai-based developer to a notable national player.Life Sciences real estate transactions reached US$18b globally in 2021WHAT ARE THE OPPORTUNITIES IN ASIA PACIFIC?K n o w l e d g e

159、B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eby:Greg Hyland and Dr.Henry ChinMany lessons can be drawn from the deep and far-reaching effects of theCovid-19 pandemic to date.But one key lesson that countries will no doubt take away is the need to be able to manufacture or

160、at least stockpile large quantities of medical supplies for use in an emergency.While supply conditions have improved,countries are keenly aware of the complications that can arise from logistics disruptions in the global supply chain,affecting access to vaccines,face masks and other personal protec

161、tive equipment.For instance,a recent study by the Organisation for Economic Cooperation and Development(OECD)found that the top vaccine exporters were significantly concentrated in developed economies like Europe and the United States.Seeking to improve supply chain resiliency,manufacturers are turn

162、ing to Asia and seeking real estate to test,produce and store vaccines,medicines and related products.This has made life sciences-related real estate in Asia a hot spot in a still uncertain global property market.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u

163、r eoffice leasing market,leasing activity recorded two consecutive years of growth supported by continued demand related to the pandemic.The sector registered year-on-year growth of 22%in 2021,on the back of 17%growth in 2020.According to data from Real Capital Analytics(RCA),US$18 billion has been

164、spent globally on life science related properties in 2021.Investors are showing increasing interest in life sciences and opportunities offered by the sector in Asia Pacific.CBREs 2022 Asia Pacific Investor Intentions Survey reveals a growing focus on healthcare,with 31%of respondents indicating an i

165、nterest in the sector,up from 25%in 2021 and 19%in 2020.While hospitals and medical centres have traditionally been main proxies for the healthcare sector,more investors are exploring opportunities to acquire business parks catering to pharmaceutical tenants and R&D laboratories.Many of these buyers

166、 are being lured by life sciences companies resilient performance amid the pandemic;large number of well-funded potential tenants;and a high degree of stickiness towards real estate where lease length far exceeds those in traditional investment sectors such as office or retail.Even pre-pandemic,the

167、sector has been on a steady uptrend.CBREs recent report,titled“A New Era of Life Sciences Growth”,identified several factors that have helped to fuel occupier demand for life sciences real estate in the region.These include burgeoning demand for pharmaceuticals from a greying population;government p

168、olicies to support the industry;a steady flow of mergers and acquisitions;a rising number of listings;and the expansion of R&D capacity.While the life sciences sector only accounts for roughly 5%of the overall Asia PacificSources:https:/ BRIGHT SPOTK n o w l e d g e B r i e f V o l u m e 7T h e F u

169、t u r e O f I n f r a s t r u c t u r eLife sciences real estate is at an early stage of development as an investible asset class,and investors are seeking to expand their knowledge about the sector.Demand is certainly growing,evidenced by the uptick in life sciences-related investment transactions

170、that we have brokered these past two years.There are several potential entry routes for investors,which can involve corporate offices,logistics facilities(including cold storage),R&D laboratories and manufacturing facilities:HOW INVESTORS CAN MAKE INROADSSale Leasebacks&Disposals:Investors seeking i

171、ncome-producing assets can target sale leasebacks or disposals by life sciences companies looking to improve their balance sheets or offload non-essential assets following M&A.CBRE expects opportunities to come onto the market in Australia,Japan and Korea as pharmaceutical companies recycle capital

172、to focus on their core R&D business.Asset Conversion:Value-added investors can consider converting older industrial properties into BSL-1/BSL-2 laboratories or cold storage.This strategy is best suited to markets like Hong Kong SAR and Japan,both of which have limited land specifically allocated to

173、the life sciences industry.But investors should also be aware of various factors that can affect conversion suitability like zoning restrictions,roof spaces,ceiling height,floor loading,floorplate,and power related issues.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r

174、 u c t u r eNote:Biosafety Level 1(BSL-1)laboratories feature settings in which personnel handle low-risk microbes that pose little to no threat of infection to healthy adults.Biosafety Level 2(BSL-2)laboratories feature settings in which personnel work with agents associated with human diseases(i.e

175、.pathogenic or infections organisms)that pose a moderate health hazard.Public-Private Partnerships:Government bodies play a prominent role in promoting the development of the life sciences industry.Investors can engage in public-private partnerships to capture development opportunities in newly plan

176、ned science parks or land tenders.We expect to see emerging hubs in various markets,such as Shanghai,Beijing,Singapore,Melbourne and Bangalore.Asset Development:There are opportunities for investors and developers to construct build-to-suit facilities with pharmaceutical companies.In Japan,Mitsui Fu

177、dosan has developed two laboratories for rent,while in Australia,Stockland acquired land in Sydneys Macquarie Park from Johnson&Johnson and developed a new headquarters building for them.Equity(fund investment and/or joint ventures)and debt:Primarily investing in pharmaceutical or logistics companie

178、s offering temperature-controlled supply chain solutions for the life sciences industry.While transactions involving debt financing are rare in Asia Pacific compared to the U.S.,this area of the capital stack offers considerable potential,particularly in Australia,due to the typically long lease ter

179、ms for life sciences real estate.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eAnother possible reason for muted interest in this asset class to date can be attributed to such properties being tightly held by universities,government bodies and end-users;an

180、d a small investible universe available for sale.100%Private ownership is limited in Australia and Japan which has also led to smaller turnover in the region.However,all this may yet change as governments begin to set their sights on recovery in a post-Covid 19 world.While the specialised nature of

181、this sector may have initially kept many at bay,we believe that investors focus on tenant credit,long leases and stable cash flows are beginning to awaken them to the recession-proof nature of life sciences real estate as they pursue diversification strategies.Read the full CBRE Research report on A

182、sia Pacific life sciences real estate,focusing on the key trends,demand drivers,corporate real estate strategies and investment opportunities in the regions major life sciences hubs.In 2021,life sciences-related transactions accounted for 1.4%of global commercial realestate volume,according to RCA,w

183、ith the U.S.accounting for the bulk of deals.In Asia Pacific,US$851 million worth of life sciences real estate changed hands in 2021.While this figure still represents a fraction of the overall total,there has been significant growth from a low base of less than US$100 million in 2018,and from the l

184、ast two years(Figure 2).One of the reasons why life sciences-related transactions in APAC have been lagging behind the U.S.is that the definition of life sciences is comparatively elongated in APAC,while in the U.S.it is very much around R&D which is located inknowledge clusters with substantial ven

185、ture capital(VC)funding.Meanwhile,the owners of the lifesciences real estate also often invested intocompanies through VC,which grants themthe ability to move tenants around as theygrow.NASCENT ASSET CLASS WITH STRONG POTENTIALK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a

186、s t r u c t u r eFIGURE 1:RECENT MAJOR LIFE SCIENCES REAL ESTATETRANSACTIONS IN ASIA PACIFICDateCountryCityProperty NameSectorTransactionPrice(US$mn)BuyerSellerRemarksQ3 2019JapanVariousTakeda property portfolio(21 assets)Office+residential466GreenOakTakedaSale leasebackQ3 2020JapanKanagawaIIF Shona

187、n Health Innovation Park(57%stake)R&D+manufacturing208IIF REITTakedaSale leasebackQ3 2020AustraliaSydney,BrisbaneSigma Pharmas two distribution centresWarehouse123LOGOS Sigma PharmaceuticalsSale leasebackQ1 2020JapanTokyoLion HQ BuildingOffice122HasekoLion CorpSale leasebackQ3 2019ChinaSuzhouSuzhou

188、API Manufacturing CampusManufacturing110Zhejiang JiuzhouPharmaceuticalNovartisDisposalQ2 2020ChinaShanghaiMedipharmBiotech Technology ParkOffice+R&D56Morgan StanleyMedipharmBiotech PharmaceuticalDisposalQ4 2019AustraliaSydneyNovartis Macquarie Park BuildingOffice42CorValNovartisSale leasebackQ4 2021

189、Australia Melbourne77-97 Ricketts RoadManufacturing+warehouse37CenturiaHealthcareBaclow Lodge Pty LtdDisposalQ4 2021ChinaWuhanBiolake Buidling D2-1Office35KindstarGlobalgeneTechnologyWuhan Optics Valley Biological Industry Base Construction InvestmentDisposalQ1 2021IndiaVemgalA manufacturing facilit

190、y for producing ZantacManufacturing25Hetero LabsGSKDisposalQ3 2020KoreaSeoulPhilosys Healthcare BuildingOffice+R&D15AddPharmaPhilosysHealthcareDisposalQ4 2020KoreaSeoulKorea Bio Park B(units 901-903)Office6Private individualNC&DisposalSource:RCA,CBRE Research,March 2022K n o w l e d g e B r i e f V

191、o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eFIGURE 2:LIFE SCIENCES REAL ESTATE INVESTMENT IN ASIA PACIFIC ON THE RISE0Investment Turnover(US$Million)1002003004005006007008009002019201820202021K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eGr

192、eg Hyland Head of Capital Markets,Asia PacificCBREABOUT THE AUTHORS:Dr.Henry ChinGlobal Head of Investor Thought Leadership and Head of Research,Asia Pacific CBREGreg Hyland is the Head of Capital Markets,Asia Pacific for CBRE.With over 20 years of experience,Greg has established deep relationships

193、with some of the worlds leading real estate investors and has advised on more than$10 billion of real estate transactions in the past five years.Dr Henry Chin is the Global Head of Investor Thought Leadership and Asia Pacific Head of Research at CBRE.Henry leads a global research team to identify th

194、e key forces influencing commercial real estate investors across all sectors and collaborates closely with CBRE clients to help them understand the intricacies of property markets and make strategic investment decisions.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u

195、 c t u r eby:Anubhav GuptaUrban Developmentin India Mumbai Development is our right.However,sustainable development is ourresponsibility.Our cities in India are perhaps going through what the West experienced during the Industrial Revolution.Today,we have access to various learnings,advanced technol

196、ogy,and communication,which our counterparts in the West may not have had back then.In theory,we should be better equipped to handle problems of traffic,congestion,pollution,exclusion&disparity,water,electricity,solid waste,and sanitation etc.Lets take one city in India Mumbai.It has been bursting a

197、t its seams for quite sometime now.The trick for winning the development race against limited and rapidly diminishing resources lies in first recognizing the urgency of our problems and subsequently formulating viable mechanisms to share responsibility and accountability in implementing solutions.If

198、 this is not done across the board,the frenzy could be a ticking time bomb.Recent reports indicated that the city may face serious water related-particularly flooding challenges by 2050.The brilliant thing about a good city is that it belongs to its people.It represents a collective of visions and m

199、odels that should work for each citizen,family,community,cluster,neighborhood,district and finally the entire metropolitan area.We could never imagine Mumbai as a blank slate but if that were so,we think it would benefit greatly from systems and a planned development approach.There are a few critica

200、l urban principles that make a good city and Mumbai should be no different Environmental sustainability;heritage conservation;accessibility/connectivity(infra,transportation etc.);identity/spirit/place-making;community;flexibility(growth and evolution);equity,institutional integrity,and civic pride.

201、With over 50%of the worlds population now urbanized,cities have emerged as engines driving growth for the human race.Mumbai can be all that its citizens want it to become,and the potential is immense.From an ingredients perspective we have all it takes to build a good recipe for success.However,we a

202、ll need to be good cooks individually and collectively.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r edone.There needs to be a paradigm shift across education,policy,public and private enterprise alike to take stock of the situation,stop further damage and

203、build a better future.There are several examples of successful urban renewal across the globe that we can learn from.Land as a finite resource has made availability(supply)and access(demand/prices)very challenging in the city.Infrastructure is severely burdened.Complex ownership and land tenure have

204、 infinitely complicated matters for redevelopment.The building permissions process is tedious and fraught with unanticipated delays impacting the economic viability of most projects.Political will and civic pride have limited priority.In such a hostile environment,large-scale redevelopment remains a

205、 challenging proposition.The housing crisis is a global problem today.In most hyper populated cities across the world,big city dreams are now looking viable only through the lens of small apartment living.Driven by the market,smaller and more efficient apartmentsAAlso,a fair amount of damage has alr

206、eady beencould be the next big trend in development.This is a challenging proposition because not everyone would agree on the precedent this would set vis-vis acceptable standards of living/habitable space.Cities like Hong Kong and Tokyo are already on that path.London,New York,and San Francisco are

207、 following suit.Mumbai could be next.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eOur planning laws and policies in India are not always as proactively geared to cater to sustainability,resilience,vibrant urbanism,changing lifestyles,improvingefficiencies

208、,conserving resources,regulating development,and encouraging smart growth.For example,on a project of 100 acres,planning laws may mandate 15%of social infrastructure defined by basic minimums.The norms for physical infrastructure are similar and not usually future forward in what really transpires f

209、or hyper dense cities.These planning norms are hence inadequate,and the development could very easily run the risk of becoming redundant and a burden on the city.While this is slowly changing as city authorities adopt more progressive development policies,the onus to think about all these issues in

210、India largely falls on private developers.This can be further challenging.As a general idea,most people would agree that tight clusters of planned growth are more sustainable as compared to suburban sprawl.Mumbai is amongst the largest cities in the world by population and density.Every day the city

211、 receives thousands of new settlers.In this sort of an already hyper dense environment,dispersal of population andmany lateral extensions of the city may start looking like controlled congestion and planned smart growth.Needless to say,that infrastructure,particularly transit-oriented development,ad

212、equate employment centers and social infrastructure distribution remains key to any kind of sensible urban growth solution.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eTechnology and research available to city planners has evolved plentifoldover the years

213、.This has positively impacted the way we do everything.From the Internet to more specific tools like Geographic Information Systems(where research,technology,processes,and methods combine to offer applications related to engineering,planning,management,infrastructure,transport/logistics,insurance,te

214、lecommunications,and business among other sectors)the new age city planner can be a ready reckoning encyclopedia of knowledge waiting to unleash his potential.Innovations coming out of proptech may lead to larger city and infrastructure ecosystemK n o w l e d g e B r i e f V o l u m e 7T h e F u t u

215、 r e O f I n f r a s t r u c t u r eAnubhav Gupta is CEO Vikhroli and Chief Sustainability&CSR Officer,Godrej Properties.Anubhav was educated at the Massachusetts Institute of Technology(MIT)and the University of Cambridge as an architect,urban designer and economist.Anubhav Gupta is a global award-

216、winning business leader,strategist and innovator whose work straddles between the economic,sustainability and design worlds across industries and asset classes.He strongly believes in sustainability being a shared responsibility and using design thinking as a strong business horizontal to connect ve

217、rticals for sustainable innovation and to fuel responsible business growth.Anubhav GuptaCEO Vikhroli and Chief Sustainability&CSR OfficerGodrej PropertiesABOUT THE AUTHOR:disruptions in urb-tech helping cities cope better for resilience and sustainability whilst ensuring vibrant urbanism.In India we

218、 urgently need to leverage this potential,examples of which we find working well in more developed economies.Counter pressures have a unique way of equalizing frenzies.There is of course a grim side to business as usual.We continue to see outcomes across the world in the form of climate change,deple

219、tion of natural resources,recession,disease and decline in public health,social unrest,blight etc.We certainly do not want more damage over the next decade.On the positive side,new trends,technology,and innovation and a change in mindset could pave the next several years with hope and optimism.Clima

220、te change is real and the urgency to address key problems is now.This is a call to action for reorganizing our priorities to become resilient and to sustain it is not an opportunity but a necessity for the future of Infrastructure and livability for our cities.Renewable Energy Scenario in India:Now&

221、Beyondby:Ankita SahuIInfrastructure and industry have been the epicenter of the Indian governments policy formulation in recent years acting as a fillip in achieving a USD 5 trillion economy and positioning India as a global economic powerhouse.With rapid urbanization and industrialization,for us as

222、 a developing nation,its pivotal to focus on alternative energy sources and transition towards non-fossil fuel sources to balance the scale between aggressive economic development goals and achieving ambitious five-part pledge by Hon.Prime Minister Modi in the COP26 summit at Glasgow which underline

223、s Indias targetof meeting half of its energy requirements by 2030 through renewable sources and net-zero carbon by 2070.As of Jan 2022,the installed generation capacity of renewable energy in India stands at 152 GW representing 38.5%of the overall installed capacity with solar and wind contributing

224、12.7%and 10.2%respectively1.Globally India ranks 4th in wind power2with a total installed capacity of 40.10 GW3(till Jan 2022).With robust policy support,around 70-80%of equipment in wind energy projects is indigenously produced.INSTALLED GENERATION CAPACITY ACROSS FUEL CATEGORY K n o w l e d g e B

225、r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r e(As of Jan 2022)INSTALLED GENERATION CAPACITY(%)SmallHydroPowerBM Power/CogenSolarHydroCoalFUEL CATEGORYGas0%10%20%30%40%50%60%WindWaste toEnergythat will help in installing wind energy projects across the coastline of a few state

226、s to strengthen the overall wind energy portfolio.In solar energy,India ranks 5th globally4and stands at a total installed capacity of 50.3 GW(till Jan 2022)5.India produces about 3 GW/year of solar photovoltaic(PV)cells and about 10 GW/year solar PV modules6 which appears significantly insufficient

227、 to meet the aggressive solar targets of 100 GW solar power by 2022.Higher cost of indigenous PV owing to scale inefficiencies and lack of incentives in past has made us import dependent to bridge gap between the growing demand and limited supply.In the past few years,we have seen a notable push fro

228、m the government to reduce import dependency by levying 40%custom duty on solar modules and 25%custom duty on solar cells,and an outlay of USD 3.2 Bn through production linked incentives to fully integrate domestic manufacturing from polysilicon to solar PV modules.This will see the price competitiv

229、eness of domestic modules and better control over the supply chain offsetting risks of logistics cost and lead time.Further,Government has notified offshore grid policyK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eIn the Indian landscape,strong policy supp

230、ort on indigenous manufacturing,the modular nature of solar panels which allows easy installation on roofs or parking lots,and accessibility and scalability of harnessing solar power give developers and property owners a push to make the transition towards green energy which will pass dual benefits

231、to the tenants in terms of cost savings on electricity bills as well as value in terms of meeting their sustainability goals.There has been an active investor interest in sustainable projects marking a shift from fossil fuel-based projects.In the last decade,India has received FDI inflow of USD10.28

232、 Bn in the non-conventional energy sector7.We can see interest across various real estate asset classes such as commercial developments,industrial and logistics,residential,and the emerging data centre sector where the investors,as well as the project owners,are inclined towards sustainable building

233、 powered by clean energy.With India at the cusp of the solar revolution,all asset classes have been taking steps to leverage solar power to meet energy needs.Data centres have emerged as one of rapidly growing alternate asset class which is power intensive.About 1390+MW of IT load is expected to be

234、deployed across top 4 data centres markets in next 5 years.and operators are looking at leveraging renewable energy to offer competitive pricing to the customers by signing long term power purchase agreement(PPA)which offer savings close to 25 percent on per unit price under captive and group captiv

235、e formats.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eOn our way to green transition,technology transition has to be our strategic ally.Policy support on R&D and technology to ensure integration of clean electrification in industrial processes,exploring

236、material efficiency,adoption of emerging technology like green hydrogen/green ammonia should be key focus areas.The Indian government has acted promptly in the space announcing Green Hydrogen Policy offering timebound single-window clearance,banking provision with distribution companies and waiving

237、off cross-subsidy and inter-state transmission changes for renewable energy in green hydrogen production for 25 years for projects commissioned before June 2025.Akey concern in achieving the renewable targets will be building astrong battery energy storage system to integrate renewable energy with g

238、rid ensuring steady power.India imports its battery cells requirement and the rising demand for these cells will cost the Indian economy dearly.The rare earth metals required to produce these cells are geographically concentrated putting us on a backfoot in cell manufacturing.Focussed R&D for altern

239、ate cell technology such as sodium-ion batteries,graphene Li-ion cells or hydrogen fuel cells and an efficient battery waste management system can help us position India strongly in the cell manufacturing space will enable a strong battery storage system and eventually larger adoption of renewable e

240、nergy.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eAnother pressing need in our transition to sustainable development is creation of a circular economy,promoting renovate,recycle and reuse,building smart cities,electric mobility and at the country level,t

241、hese areas have been taken up for reforms.Achieving ambitious renewable energy targets needs close coordination and support between various government departments,financial institutions,distribution companies,manufacturers and business conglomerates.Ankita holds about 6+years of experience in real e

242、state and infrastructure industry across business development,bid and proposal management and transaction advisory.At AnarockCapital,Ankita is a part of industrial and data centre team supporting investment advisory and land acquisition.Previous tothis role,Ankita has worked with Sterling&Wilson for

243、 their projects in industrial and infrastructure sectors.Ankita holds B.Tech(2013)from Uttar Pradesh Technical University in Productions&Operations Engineering and Post-Graduate in Project Management(2016)from the National Institute of Construction Management&Research(Pune).Ankita SahuManagerIndustr

244、ial&LogisticsANAROCK CAPITAL ADVISORS PVT.LTD.ABOUT THE AUTHOR:End Notes:1.Power Sector at a glance-https:/powermin.gov.in/en/content/power-sector-glance-all-india(Ministry of Power,Government of India)2.India Brand Equity Foundation,Indian Renewable Energy Industry Analysis-https:/www.ibef.org/indu

245、stry/renewable-energy-presentation3.Ministry of New and Renewable Energy,https:/mnre.gov.in/wind/manufacturers-and-quality-control4.India Brand Equity Foundation,Indian Renewable Energy Industry Analysis-https:/www.ibef.org/industry/renewable-energy-presentation5.Power Sector at a glance,Ministry of

246、 Power-https:/powermin.gov.in/en/content/power-sector-glance-all-india(Ministry of Power,GOI)6.Ministry of New and Renewable Energy https:/mnre.gov.in/solar/manufacturers-and-quality-control7.India Brand Equity Foundation,Indian Renewable Energy Industry Analysis-https:/www.ibef.org/industry/renewab

247、leenergy-presentationData Centrescharting a new growth wave in IndiaK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eby:Devi ShankarThe importance of data centres in India accentuated following the draft dataprotection bill announced by Government of India in

248、 2019.While the draft bill is yet to become law,soft implementation has begun and many large companies in the banking and payments industry have been subject to restrictions for non-compliance.The draft data localization rules require data generated in India to be physically stored in India and proh

249、ibits cross border transfer of critical data.There has been a flurry of activity at large cloud companies(referred to as“hyperscalers”),financial services companies and several global technology companies to look for data(co)location options within India with respect to their India businesses.India

250、is a large market with data consumption exploding at a rapid pace.Active mobile internet users and active social media users have increased at 12%and 21%respectively per annum over the last 5 years.The average data consumption has shot up from a mere 300 MB per user per month in 2014 to 13 GB in 202

251、0.This is expected to explode to 25 GB by 2025.RETURN ON TR INDEX 2020%-US DATA CENTRE REITS-19%-8%-24%-10%-22%-11%-25%-18%21%7%10%13%14%MortgageSpecialtyHospitalityHealth CareDiversifiedResidentialRetailOfficeDATA CENTRESInfrastructureTimberSelf StorageIndustrialK n o w l e d g e B r i e f V o l u

252、m e 7T h e F u t u r e O f I n f r a s t r u c t u r e6 YEAR RETURN ANALYSIS(USA)100%80%60%40%20%0%-20%-40%201520162017201820192020S&P 500Data Centreseconomic growth,the Government classified data centres as an Infrastructure in the recently proposed Union Budget 2022.This makes data centres even mo

253、re attractive as an investible asset class.It is noteworthy that in the United States of America,one of the most matured financial markets.Data Centre REITs were the best performing REIT in 2020 outperforming the conventional REITs at 21%annual return.In fact,Data Centre REITs outperformed even the

254、S&P 500 index over a 6 years horizon.Data centres in India is at a very nascent stage.However,the industry is poised to move on an upward trajectory over the next 5 years,with a large liquidity pool arising out of active interest from large private equity and institutional capital providers.Further

255、with the classification as infrastructure,project financing becomes less risk-weighted for banks and hence,should become more readily available at attractive coupon rates and long-term tenures.All of these can support the industry in the exponential growth that we are projecting.Recognizing the crit

256、icality of data centres to IndiasK n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r eWith a mere 600+MW of IT power capacity,India should add another 1390+MW of capacity in the next 5 years.Most of this new capacity will be targeted towardshyperscalers and large

257、 enterprises thus changing the competitive landscape significantly amongst operators vying for a share in the pie of large cloud demand.Mumbai and Chennai have historically been the centresof most data centres in India given the optical fiber cable landings in these two coastal cities of India.Out o

258、f 30 landing stations that are operational,16 land at Mumbai and Chennai.Further 8 out of 9 under construction cable networks will land in these two cities.MUMBAI&CHENNAI12Easy optic fiber capability gives a natural advantage to Mumbai and Chennai amongst upcoming supply with almost 63%of new supply

259、 concentrated in just these two cities.3Noida and Hyderabad will also see a fair share of demand and supply primarily driven by Government and Hyperscalers respectively.15%and 17%of upcoming supply will arise in Noida and Hyderabad respectively.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u

260、r e O f I n f r a s t r u c t u r eAnother notable trend in this industry is the adoption of ESG practices.Adopting clean and green power is topmost in the priority of most customers and DC operators.Most players are looking at approx.50-60%of their total power being met through clean power.Further

261、there is constant innovation underway in bringing in operational efficiencies in areas such as data compression,cooling technologies,power back-ups,IOT and automations,etc.Globally,many DC operators are using modularized approach to development of new facilities to improve go-to-market timelines.Ind

262、ia could also see a similar trend in future in the quest for quicker deployments.On the capital side,India has seen some large commitments towards this industry.Three large platforms were announced in 2021 viz.EverYondr($1 bn),Brookfield-Digital Realty($2 bn)and Kotak-Sify($135 mn+$530 mn for new DC

263、 opportunities).In addition,hyperscalers have also committed to invest large in digital infrastructure in India.Google has committed$10 bn,AWS$1.6 bn and Microsoft another$2 bn.There is further institutional capital committed or waiting in the wings to be deployed for data centres.With this is huge

264、liquidity,one can expect yield compressions from a current 13-14%post tax development yields(underwritten)to almost 8-9%on completed core assets over the next few years.This is a massive opportunity for early entrants to create an alternative investment class that provides near stable long-term yiel

265、ds.K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r ecentre policy to ensure ease of doing business in the sector and promote growth,investments and competitiveness through various fiscal and non-fiscal incentives.The policy envisages development of large data

266、 parks to leverage economies of scale,encourages use of indigenously made hardware and components in line with its Make in India policy.With all the compelling drivers for data centres in India,and an adequate support framework from the Government,it will be intriguing to see whether India can capit

267、alize its position into becoming a regional data hub in Asia Pacific.TThe Government of India in 2020 released a draft dataWith an experience of over 18 years,Devi has worked in the entire gamut of investments from private equity,investment banking and structuring.With this wealth of all-round expos

268、ure,in her current role at Anarock Capital,she heads Industrial and Data Centers focusing on investment banking,land acquisition and colocation sales.Devis previous stints include ASK,JLL,Deloitte and KPMG where she worked in different roles focusing on the real estate sector in India.Devi is a Chartered Account,Chartered Financial Analyst and an MBA(Hons)from the University of Chicago Booth School of Business.Devi ShankarPresident Industrial&Logistics I Data CentreANAROCK CapitalABOUT THE AUTHOR:K n o w l e d g e B r i e f V o l u m e 7T h e F u t u r e O f I n f r a s t r u c t u r e