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Rising power shortages and on-site energy solutions are blurring the lines between private real estate and infrastructure, prompting major investment firms to adapt strategies that capitalise on integrated energy generation within real estate assets, signalling a transformative shift in the sector.
The traditional divide between private real estate and infrastructure investment is increasingly becoming less distinct, driven primarily by the rising scarcity of power and the demand for on-site energy solutions. This dynamic, often overshadowed in discussions about capital allocation, is reshaping how investors and asset managers approach these sectors.
Jacob Monroe, co-founder and CEO of Camion Energy, highlights the central role that power scarcity plays in this evolving landscape. He argues that investors willing to transcend the conventional separation between infrastructure and real estate stand to benefit from the growing need to integrate energy generation directly within real estate assets. This approach not only addresses urgent energy demands but also opens pathways for enhanced returns. The mounting pressures on power grids, alongside a push towards electrification—ranging from logistics to heavy industry—underscore the necessity for such integration.
Significant players have responded by merging their real estate and infrastructure platforms. New York-based private equity firm KKR, for example, consolidated its platforms in early 2024 with the explicit aim of improving coordination on power concerns within its real estate portfolio, as explained by Raj Agrawal, KKR’s global head of real assets. This strategy allows the firm to leverage expertise across sectors, aligning efforts to tackle energy availability and sustainability challenges. KKR’s vast real estate and infrastructure portfolios, with assets exceeding $80 billion in both domains, illustrate the scale at which such integration can be pursued, emphasizing the firm’s commitment to addressing emerging energy and infrastructure needs within real estate investments.
This trend is also evident among other institutional investors. Australian superannuation funds, including Australian Retirement Trust and AustralianSuper, have recently unified their respective real estate and infrastructure divisions, while London-based Phoenix Group and Abu Dhabi’s Mubadala Investment Company have made similar moves. Manuel Dusina, head of real assets at Phoenix Group, stresses that on-site power generation is essential for powering the “mega-trends” shaping both sectors in the future. He notes the benefits of on-site generation for cost savings, energy independence, and carbon footprint reduction, while acknowledging that practical suitability depends on factors such as location and scale.
Julie Ingersoll, CIO of Americas direct real estate at CBRE Investment Management, highlights how energy concerns are now integral to asset selection across real estate sectors beyond traditional high-power demands like data centres. She describes how collaboration between infrastructure and real estate teams has intensified, with infrastructure experts advising on power availability, costs, and renewable feasibility—a partnership that was uncommon a decade ago.
Global logistics giant Prologis exemplifies early adoption of this integrated approach. Since 2007, it has pursued on-site power solutions such as rooftop solar installations, which currently generate over 550 megawatts globally with plans to surpass 1 gigawatt soon. Prologis views such capabilities as competitive advantages that attract tenants requiring substantial power, including those transitioning to electric vehicle fleets, like Maersk’s recent establishment of a 100-vehicle EV charging station powered by a multi-fuel heat pump in California. JT Steenkamp, Prologis Mobility’s vice-president, encapsulates this shift succinctly: “You have to be an infrastructure player if you’re a real estate player in the 2020s and beyond.”
Industry forecasts support the urgency of these adaptations. The Bank of America Institute projects a 2.5% annual increase in US electricity demand through 2034, while European governments anticipate even steeper rises in energy consumption, driven by factors including electrification of transport, automation, and the adoption of heat pumps. Amazon’s deployment of one million robots in its warehouses and McKinsey’s prediction of a 15% annual growth in heat pump demand for logistics further illustrate how these trends fuel power needs.
Thomas Bayerl, global head of illiquid assets at Munich-based MEAG, echoes the financial logic behind integrating infrastructure and real estate investments. MEAG’s extensive €15 billion real estate portfolio leverages capabilities from its illiquid assets team to deploy rooftop solar, enhancing property energy efficiency and unlocking higher profits. Industry observers like GRESB’s chief innovation officer Chris Pyke expect this synergy to compound asset value, with on-site generation and load flexibility creating new revenue streams analogous to traditional energy production.
However, experts caution that convergence is not without risks. Hugo Llewelyn, CEO of Newcore Capital Management, warns that improper risk assessment and communication can cause significant problems, such as when infrastructure revenue underpins real estate asset valuations. He points to historical failures like Southern Cross in the UK, where aggressive financial engineering and neglect of maintenance led to societal harm and investor losses, underscoring the need for balanced, responsible management.
Looking ahead, the consensus among industry leaders is that tighter integration or outright unification of real estate and infrastructure teams will become the norm. Monroe foresees that growing power scarcity and tenant preferences for grid-independent sites will drive this trend, supported by the capacity of larger funds to absorb initial infrastructure investment costs and enhance overall asset quality. Ingersoll anticipates the development of hybrid investment strategies blending real estate and infrastructure, which could reshape private market approaches globally, reflecting a new normal where cross-asset collaboration is imperative to compete and succeed.
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Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative discusses recent developments in the integration of real estate and infrastructure investments, particularly focusing on on-site power generation. Similar themes have been reported in May 2025, such as KKR’s consolidation of its real estate and infrastructure divisions. ([globest.com](https://www.globest.com/2025/05/13/blurring-boundaries-between-real-estate-and-infrastructure-signal-a-new-investment-era/?utm_source=openai)) The earliest known publication date of substantially similar content is May 13, 2025. The report appears to be original, with no evidence of recycled content. The inclusion of updated data on KKR’s consolidation strategy and Prologis’ on-site power solutions suggests a high freshness score. However, the report may have been influenced by recent press releases from these companies, which typically warrant a high freshness score. No discrepancies in figures, dates, or quotes were identified. The narrative does not appear to be republished across low-quality sites or clickbait networks. No earlier versions show different figures, dates, or quotes. The article includes updated data but recycles older material, which may justify a higher freshness score but should still be flagged.
Quotes check
Score:
9
Notes:
The report includes direct quotes from industry leaders such as Jacob Monroe, Raj Agrawal, Manuel Dusina, Julie Ingersoll, and JT Steenkamp. Online searches for these quotes reveal no earlier usage, indicating that they are potentially original or exclusive content. No identical quotes appear in earlier material, and no variations in quote wording were found.
Source reliability
Score:
7
Notes:
The narrative originates from PERE News, a publication focused on private real estate and infrastructure investments. While PERE News is a specialised outlet, it is not as widely recognised as major media organisations like the Financial Times or Reuters. The individuals and companies mentioned, including Jacob Monroe, Raj Agrawal, Prologis, and KKR, are verifiable and have a public presence. No unverifiable entities or potentially fabricated information were identified.
Plausability check
Score:
8
Notes:
The narrative presents a plausible analysis of the convergence between real estate and infrastructure investments, supported by recent developments such as KKR’s consolidation of its real estate and infrastructure divisions. The claims are consistent with other reputable outlets, and the report includes specific factual anchors like names, institutions, and dates. The language and tone are consistent with industry reporting, and there is no excessive or off-topic detail. The tone is formal and appropriate for the subject matter.
Overall assessment
Verdict (FAIL, OPEN, PASS): PASS
Confidence (LOW, MEDIUM, HIGH): HIGH
Summary:
The narrative provides a timely and original analysis of the integration between real estate and infrastructure investments, supported by verifiable sources and consistent with industry developments. No significant issues were identified in terms of freshness, quotes, source reliability, or plausibility.
