IFM Investors Proposes Blueprint to Unlock Billions in Pension Capital for US Infrastructure

New York - IFM Investors, the global asset manager owned by Australian and British pension funds, has released a strategic policy blueprint designed to funnel billions of dollars in retirement savings into the modernization of United States infrastructure.

The report, titled Revitalizing US Infrastructure: The Pension Capital Advantage, arrives as the American Society of Civil Engineers projects a US$3.7 trillion funding shortfall through 2033.

The blueprint advocates for "asset recycling," a model successfully utilized in Australia, where state governments lease existing assets like roads or airports to long-term investors and reinvest the proceeds into new public works such as schools and hospitals.

Australian pension capital is currently on track to become the world’s second-largest retirement system by 2035.

With approximately US$3 billion in weekly inflows, these funds are increasingly targeting the U.S. as their primary international investment destination.

"The U.S., like most developed nations, faces a clear challenge, infrastructure needs are growing faster than the public funding needed to support them," said David Whiteley, IFM Investors Head of Global External Relations.

"US and Australian pension funds can be part of the solution," he said.

The blueprint outlines several technical and regulatory reforms intended to make the U.S. market more attractive to institutional capital.

A primary recommendation is the creation of Federal Infrastructure Investment Incentive Grants (I3Gs).

These would provide incentive payments to state and local governments that successfully attract private investment for existing brownfield assets and redeploy that capital into new community infrastructure.

Furthermore, the report calls for amendments to U.S. tax law regarding tax-exempt debt.

Current regulations often require local governments to pay off existing tax-exempt debt when entering a public-private partnership (P3).

IFM proposes allowing this debt to remain outstanding or permitting investors to use new tax-exempt debt to acquire P3 concessions, which would significantly improve the economics of such deals for both taxpayers and investors.

The timing of the release coincides with the Australian Superannuation Investment Summit, where leaders from Australia’s largest funds are meeting with officials in San Francisco, Washington D.C., and New York.

Projections suggest that total Australian pension investment in the U.S. will triple to US$1.5 trillion by 2035, with US$67 billion specifically earmarked for private infrastructure.

IFM Investors, which manages US$184.1 billion, already represents over 32 million workers globally and has investments in more than 30 U.S. states.

The firm maintains that pension capital is uniquely suited for these assets due to its long-term investment horizon and alignment with community needs.

"With the right policy settings, pension capital can play a major role in modernizing America’s infrastructure," Whiteley stated, adding "delivering for U.S. communities and for the long-term retirement savings of working people in both Australia and the U.S."