This special issue of the June 2015 Pensions & Investment EDHEC-Risk Supplement includes a special focus on infrastructure investment research.

Our first article argues that a number of characteristics associated with the structuring of capital projects constitute a much more powerful framework to understand, benchmark and predict long-term returns in infrastructure debt or equity. Thus, infra- structure investment can be construed as a way to buy claims on future cash flows created by long-term contractual arrangements between parties. In numerous cases, infrastructure investors do not actually own any steel or concrete. When they do, the value of their investment is conditioned not by the tangible nature of the asset, but in a license to operate a natural but regulated monopoly.

In the area of infrastructure investment, having progressed towards clear definitions of underlying assets, and built robust, state-of-the-art pricing and risk models that avoid the pitfalls of existing practices and are designed to deliver the answers needed by investors, regulators and policy-makers, it is now time to collect the relevant information. Collecting this information requires large-scale cooperation between investors, creditors, academic researchers and the regulators that can help make such reporting part of a new standard approach to long-term investment in infrastructure by institutional players.

We discuss a dedicated valuation framework for privately-held infrastructure equity investments. Following the roadmap to create long-term infrastructure investment benchmarks that we had previously developed, this framework takes into account the challenges of valuing privately-held and seldom-traded infrastructure equity investments, while aiming to design a methodology that can be readily applied given the current state of empirical knowledge and, going forward, at a minimum cost in terms of data collection.