Industry insights: Infrastructure
Australia’s social and economic prosperity are acutely intertwined with the health of our infrastructure sector. Great infrastructure keeps us connected, healthy and educated, connects the utilities that run our homes, and mitigates the impact of climate change. It fuels economic growth and has an important role in facilitating trade.
The major forces at the heart of the infrastructure sector have remained consistent in recent times. For decades Australia has been focused on digitisation, sustainability, funding and the interaction between the private and public sector. That said, the progress, innovation and resilience we have seen in the sector during the past decade has been nothing short of phenomenal. The infrastructure we rely on so heavily is now more connected, accessible and resilient than ever before.
MinterEllison’s infrastructure team has a multi-disciplinary approach to supporting the industry and during the past 12 months we have worked closely with clients who have adapted their businesses and seized opportunities that have emerged through COVID-19.
Governments have reached for the infrastructure lever during COVID to ensure that our economies and communities recover quickly. Funds have flooded into assets with competition for both brownfield and greenfield opportunities more intense. M&A activity has either matched or exceeded the upward trend seen across all sectors.
Post COVID we are likely to see greater demand for utilities, transport and technology to interact seamlessly. Project and precinct developments are increasingly complex and require teams of infrastructure specialists who understand that collaboration across disciplines is required to fund, design, develop and operate great infrastructure.
With different working patterns and less geographic ties the focus is switching to developing infrastructure that connects people and commerce to the regions. We are no longer tied in the same way to our CBDs and industrial heartlands, and governments therefore, are focusing on improving regional infrastructure to meet increased demand.
In terms of delivery, we are assisting clients as they adapt and innovate to navigate erratic supply chains for both goods and services. There is a scarcity of suitably qualified people in the sector and with projects in Australia often requiring globally recognised expertise, the opening of borders, within Australia and internationally, will improve access to talent.
Underscoring the trends in the sector is the drive for infrastructure to mitigate the impacts of climate change. In blunt terms, funds, resources and governments will continue to divert away from carbon intensive assets if there is no clear transition to a carbon neutral future.
“Obviously the events of the past 12 months have further complicated an already complex sector and the temptation is to wait for more certainty before we commit to what comes next. However, with 25+ year lifecycles for many of our assets we are going to have to be better at living with uncertainty. The technology sector has much to teach us in this regard and if one thing is certain, it is that we will see tech playing a much bigger role in delivering great infrastructure.”
Owen Cooper, Infrastructure Industry Sector Lead