Editorial for special issue on infrastructure and real estate
| Published date | 26 March 2021 |
| Pages | 181-182 |
| Date | 26 March 2021 |
| DOI | https://doi.org/10.1108/JPIF-04-2021-174 |
| Subject Matter | Property management & built environment,Real estate & property,Property valuation & finance |
| Author | Seow Eng Ong,Chyi Lin Lee |
Guest editorial
Editorial for special issue on infrastructure and real estate
The coronavirus disease 2019 (COVID-19) pandemic has reinforced the importance of
infrastructure not only in enhancing connectivity and utility services but also stimulating the
economy. It was estimated that global infrastructure investment needs will reach US$94tn by
2040 (Oxford Economics, 2017). However, United Nations (2020) found that crit ical
infrastructure, including telecommunication infrastructure in developing countries,
remains scarce. These clearly highlight the urgent need for infrastructure investment.
Despite the infrastructure asset class being the focus of growing attention, studies on
infrastructure investment are somewhat limited. This special issue attempts to address the
critical research gap in the real estate and infrastructure literature. We are pleased to put
together the special issue of Infrastructure and Real Estate. A total of six papers have been
selected for publication in this special issue of the Journal of Property Investment and Finance.
The papers cover various infrastructure topics, including infrastructure inves tment,
infrastructure financing mechanisms (e.g. land value capture), infrastructure modelling
and infrastructure stakeholders in different regions (Europe, Asia Pacific and Africa).
Firstly, Mazuki and Newell’s paper examines the investment opportunity of non-listed
infrastructure for global institutional investors. Importantly, their studies show that
non-listed infrastructure plays a vital role in a mixed asset portfolio. This indicates that
non-listed infrastructure is an effective alternative asset with strong return performance
and less volatility.
The interface between infrastructure and real estate is the focus of the work by McGaffin,
Viruly and Boyle. The paper discusses the extent to which real estate could support the
delivering of infrastructure projects by reducing the reliance on the traditional public
funding. Specifically, this paper critically reviews and discusses how land-based financing
can be used to fund infrastructure in South Africa. However, they recommend the use of tax-
increment finance as many land-based financing mechanisms, in an emerging country
context, do not raise sufficient funding for infrastructure investment in meeting the
infrastructure needs in South Africa.
In contrast, Lee and Locke highlight the unique passive land value capture mechanism
that has been widely adopted in Australia. Using the Sydney Metro City and Southwest
project in Sydney as a case study, they find that the passive value capture mechanism is an
effective form of value capture mechanism to capture the value uplift. However, they also
raise the concern of the sensitivity of this model to unprecedented events such as the
COVID-19 pandemic. As such, a shift towards a broad-based land tax is recommended. Both
papers have clearly highlighted real estate is a key element in supporting infrastructure.
Recognising the potential differences amongst different sub-sectors of infrastructure,
another infrastructure investment paper from Mazuki and Newell focusses on a sub-sector
analysis. They demonstrate the satellite and telecommunication infrastructure has taken an
increased role since the global financial crisis. This again highlights that the opportunity of
investors seeking exposure in the increasingly important communication infrastructure
assets sector.
Guest editorial
181
The support from the National University of Singapore –Jurong Town Corporation Industrial
Infrastructure Innovation Centre is greatly appreciated.
This paper forms part of a special section “Industrial Infrastructure and Real Estate”, guest edited by
Professor Seow Eng Ong, Associate Professor Chyi Lin Lee.
Journal of Property Investment &
Finance
Vol. 39 No. 3, 2021
pp. 181-182
© Emerald Publishing Limited
1463-578X
DOI 10.1108/JPIF-04-2021-174
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