Digital Infrastructure as an Investment Class
December 15, 2020
Digital infrastructure broadly refers to the real assets that keep us all connected. Data centers, cell towers, fiber optic networks, and other essential communications infrastructure assets are the backbone of the internet, cloud computing, mobile broadband and much more.
It is widely recognized that the COVID-19 pandemic has accelerated trends that were already well under way prior to 2020. Using the internet to do jobs remotely, continue school learning, and staying connected with one another has become a necessity rather than a convenience. The infrastructure that supports high-speed broadband connectivity is now more essential than ever.
While different sectors of the infrastructure industry have been affected differently by the pandemic, the communications (IP Traffic) and Computing (Cloud) sectors have seen incremental volume increase of 20% to 50%, due in part to COVID-19.
Two investment types that are enjoying tailwinds from the demand for connectivity are data centers and wireless infrastructure. Data center leasing activity has increased dramatically and is already a record setting year. Growth in internet traffic, cloud computing, Internet of Things (IoT), 5G, and evolving technologies like virtual/augmented reality and autonomous vehicles, should continue to pave the way for long-term growth in the data center and wireless infrastructure sectors.
Learn more in Strategic Capital Fund Management’s Q3 2020 Digital Infrastructure Update by clicking below.
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