MEDIA RELEASE: Maple-Brown Abbott welcomes Treasury’s decision to adjust the Australian and international listed infrastructure APRA performance benchmark, agreeing that the adjusted benchmark better represents the asset class and provides superannuation funds with greater choice to invest in listed infrastructure assets, to the benefit of their members.

The decision was recently announced by The Hon Stephen Jones MP, Assistant Treasurer and Minister for Financial Services, following submissions from Maple-Brown Abbott and other industry participants.

Andrew Maple-Brown, co-founder and managing director, Maple-Brown Abbott Global Listed Infrastructure, said the adjusted benchmark – the FTSE Developed Core Infrastructure 50/50 100% Hedged to AUD Net Tax (Super) Index – has weightings much more representative of the asset class on both a geographic and sector basis.

For example, the North American exposure is reduced from 82% to 65% and the exposure to transportation infrastructure (excluding railroads) increases from 3% to 23%.

“The adjusted APRA benchmark better facilitates a more balanced exposure to listed infrastructure, and should help encourage super funds to invest in listed infrastructure assets in Australia and overseas,” Mr Maple-Brown said.

“The need to outperform the existing benchmark has served to concentrate portfolios towards unlisted assets. In our opinion this was unnecessarily restricting super funds from being able to access the attractive benefits of listed infrastructure,” he said.

Steven Kempler, co-founder and portfolio manager, Maple-Brown Abbott Global Listed Infrastructure, said the benchmark change is particularly pertinent given the significantly discounted valuations of listed infrastructure assets relative to private infrastructure assets.

“We believe listed infrastructure is trading materially cheaper than private infrastructure. We recently authored a white paper which explains the significant valuation gap between listed infrastructure and private infrastructure, and the implications for investors.

“The benchmark adjustment comes at an opportune time. It better facilitates super funds accessing quality infrastructure assets at relatively attractive prices, managed by high performing listed infrastructure managers, within which Australian managers are globally recognised as leading performers.

“The liquidity available to funds by having a portion of their infrastructure exposure allocated to liquid assets is particularly attractive. This has gained increased attention since the UK pension liquidity crisis in 2022,” Mr Kempler said.

Mr Maple-Brown said: “We believe the adjustment will have positive implications for asset allocators benchmarking within this asset class and ultimately all Australian superannuation holders that have an exposure to listed infrastructure. For these reasons we applaud the prompt action taken by Treasury which provides greater opportunities for super funds and their members.”